The nearly $80 billion tax deal has become a temporary victim to the Senate calendar, but supporters are still working on securing a Senate process to advance the package to enactment.
The bipartisan, bicameral deal passed the House by an overwhelming margin, giving it substantial momentum headed into the Senate. The bill ran into a Senate logjam, however, as Senate Majority Leader Chuck Schumer spent last week’s floor time trying and failing to advance a supplementary spending and border security bill. The Senate is now in recess, returning on Feb. 26, meaning that late February or the beginning of March are the earliest possible passage windows.
Further complicating timing is the fact that government funding runs out in two tranches on March 1 and March 8, making that a likely priority for when the Senate returns. The tax bill could be added to a spending package, but Republican concerns about the bill complicate that possibility.
Multiple senators also want to offer amendments, primarily around the child tax credit provisions, and some Republicans are pushing for a full markup in the Senate Finance Committee. Schumer and Senate Finance Committee Chair Ron Wyden, D-Ore., are still considering their procedural options.
A markup could slow the process the down, but Wyden and Schumer will likely have to offer some process for amendments at either the committee level or on the floor to secure support for passage. If any amendments are accepted, it could derail the package by upsetting the balance of support and requiring another House vote.
If an amendment process is needed, and the Senate calendar does not change, then that could push passage of the bill until mid-March. However, historically unpredictable political dynamics at the congressional and presidential level could still affect the bill’s chances of becoming law, so proponents will try to push it into law before then.
Grant Thornton Insight
Despite the challenges, the package still enjoys the support of Schumer and the White House and has a reasonable path to enactment. The legislation would have a significant and favorable impact on most businesses but could present administrative and compliance challenges. There are important transition rules and elective options for both retroactive and prospective implementation (see our prior legislative update for more information). Taxpayers should consider assessing the potential impact and evaluating their planning opportunities in preparation for potential enactment.
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