On June 16, 2025, the Senate Finance Committee released its version of the tax bill – “The One, Big, Beautiful Bill” (OBBB). The President has expressed the goal of signing the bill into law by July 4, 2025.
The Senate’s proposal follows the House version introduced last month, but includes several key differences in income thresholds, phase-outs, credit limitations and business accounting methods.
To highlight a few key provisions from the Senate’s tax bill:
Individual Provisions:
- SALT Deduction Limitation: Permanently caps the State and Local Tax deduction at $10,000, with adjustments for passthrough entity tax (PTET) deductions.
- Excess Business Loss: Remains consistent with the House version.
- Tips & Overtime Deduction: Both bills exclude tips and overtime from taxation, but with different AGI thresholds and maximum deduction limits.
Business Provisions:
- Qualified Business Income (QBI) Deduction: Maintains the 20% deduction and makes it permanent.
- Bonus Depreciation: 100% bonus depreciation will become permanent.
- Research & Development (R&D): Allows full deduction of domestic R&D expenditures in the year incurred. Also includes provisions to accelerate the deduction of previously capitalized R&D expenses.
For detailed comparison between the House and Senate proposals, CLICK HERE.
The legislative process will continue with the House and Senate conferencing to reconcile the differences, or House voting on the Senate-passed bill directly.
If you have any questions or would like to discuss how these proposed changes could affect you, please don’t hesitate to reach out to your SAX Advisor.