SALT Deduction Cap Increase
Raises the state and local tax (SALT) deduction cap to $40,000 ($20,000 for married separate filers) and indexes it for inflation through tax year 2029.
Child Tax Credit Expansion
Enhances refundability and adjusts calculations to benefit more low-income families, including indexing for inflation.
Residential Clean Energy Credit Updates
Modifies and extends credits for residential clean energy improvements to encourage energy-efficient upgrades.
Tax Filing Simplifications
Improves electronic filing systems for taxpayers and the IRS to streamline processes and reduce burdens.
Bonus Depreciation Extension
Extends 100% bonus depreciation through 2025, phasing down afterwards.
Research & Experimental (R&E) Expense Deduction Change
Allows immediate expensing for domestic R&E costs through 2025, rather than required amortization under previous law.
Section 163(j) Interest Limitation Relief
Returns to EBIT (earnings before interest and taxes) calculation, increasing allowable business interest deductions.
Net Operating Loss (NOL) Rules Modification
Modifies NOL limitations for pass-throughs to align with corporate rules.
Extension of Key Credits
Extends several renewable energy credits and incentives for clean electricity and fuels.
New Advanced Manufacturing Production Credit
Supports domestic production of critical clean energy components.
Carbon Capture Credit Changes
Adjusts credit amounts and eligibility requirements to broaden use.
GILTI (Global Intangible Low-Taxed Income) Changes
Adjusts calculation rules to be more favorable to U.S. multinational companies.
Foreign Tax Credit Updates
Modifies rules to allow better crediting of certain foreign taxes against U.S. tax liability.
No Major Changes Noted in This Bill
Estate and gift tax provisions remain largely unchanged in this legislative package.
Technical Corrections
Includes clarifications for exempt organization tax rules, including unrelated business income adjustments.
Disaster Tax Relief
Provides tax relief measures for federally declared disaster areas.
Employee Retention Credit (ERC) Changes
Implements stricter rules to address ERC fraud and sets compliance deadlines.
IRS Funding Adjustments
Reallocates funds for technology and enforcement improvements within the IRS.
Please note: These are over view highlights of the bill’s provisions. There may be additional details, exceptions, and complexities not covered here. We recommend consulting with your Enrolled Agent for guidance on your specific situation.
