On April 10, after a tense overnight period during which about a dozen House Republicans said they would vote against the compromise Congressional Budget Resolution (CBR) that authorizes a Senate filibuster-proof reconciliation bill, the House narrowly approved the Senate-passed compromise budget. The 216-214 vote opens the way for writing a multi-trillion-dollar budget bill that will contain a huge tax package as well as deep spending cuts. Two Republicans joined all the Democrats in voting against the resolution.

The U.S. government cannot borrow beyond a statutory limit (the “debt limit”), and when borrowing needs exceed the debt limit either Congress must raise (or suspend) it, or the U.S. will not be able to meet all its obligations on a timely basis. Such a failure to make timely payments would trigger worldwide economic catastrophe, putting at risk the “full faith and credit” of the U.S., economists say. The U.S. is currently at the statutory debt limit and is using certain accounting measures to avoid breaching the cap. Those accounting measures will be exhausted in the coming weeks, setting up a key legislative priority for Congress.

On March 11, a group of bipartisan, bicameral legislators, led Rep. Mike Carey (R-OH), Rep. Linda Sanchez (D-CA), Sen. Shelley Moore Capito (R-W.VA.) and Sen. Michael Bennett (D-CO) reintroduced the Credit for Caring Act, which would provide a federal, nonrefundable tax credit of up to $5,000 for working family caregivers. Caregivers with an earned income of at least $7,500 annually would be eligible for the credit if their care recipient meets certain functional or cognitive limitations. The credit would phase out for individual filers earning more than $75,000 in a taxable year and $150,000 for joint filers.

On April 2, the House Education and the Workforce Committee’s Health Subcommittee held a hearing on “expanding access and affordability” to employer-sponsored health insurance. A key priority the subcommittee discussed was association health plans (AHPs).

On March 14, Congress enacted a continuing resolution (CR) to fund the government’s discretionary spending through September 30, 2025, the end of the current fiscal year.

Enactment of the law prevented a government shut-down that, absent this measure, would have kicked in at midnight March 15.

The House and Senate have passed different Congressional Budget Resolutions (CBRs). Now, the two chambers must reconcile the differences to pass identical CBRs to unlock the budget process (reconciliation) that could bring deep mandatory and discretionary spending cuts, a huge tax package, and possibly an increase in the debt limit.

President Trump and the GOP-controlled Congress are officially in power, and have begun work on an aggressive, high-profile agenda covering among other issues spending cuts, taxes, and shrinking the federal government. Many—maybe most—of these issues could directly impact NAIFA members.

Legislation to make permanent the section 199A deduction for qualifying noncorporate business income has been introduced in both the House and Senate. The legislation is partisan—only Republicans cosponsored it in both chambers of Congress—but the number of cosponsors (35 in the Senate, including most of the Senate GOP’s leadership, and 152 in the House) demonstrates the strength of support for the measure.

On January 3, Rep. Vern Buchanan (R-FL), a senior member of the tax-writing Ways & Means Committee, introduced H.R.143, a bill that would make permanent expiring individual tax rates (including section 199A), the standard deduction, the estate tax personal exemption, and other individual tax provisions. The bill also specifically repeals the expiration date of section 199A, the deduction for qualifying noncorporate business income.

On January 3, Rep. Andy Biggs (R-AZ) introduced legislation that would repeal the limits on the kinds of businesses that are eligible for the section 199A deduction for qualifying noncorporate business income. The bill would also repeal the estate tax while retaining the step up in basis for assets passing to heirs after the decedent’s death.

Bipartisan legislation to allow 403(b) retirement savings plans to invest in collective investment trusts (CITs) has been introduced in both the House and Senate. The legislation would amend securities laws to allow for 403(b) CIT investments. Retirement law was amended to allow these CIT investments in SECURE 2.0, but efforts to expand the CIT investment authority to include securities laws fell short at the time.

A bipartisan Senate bill, the “Charitable Act,” would reestablish an above-the-line charitable deduction. The deduction would allow taxpayers who do not itemize to deduct their charitable contributions up to an amount equal to up to one third of the standard deduction.

On February 13, President Trump’s nominee to be Secretary of the Department of Health and Human Services (HHS), Robert F. Kennedy Jr., won approval from the Senate following approval by the Senate Finance Committee on a party-line 14 to 13 vote.

The last big-ticket item approved by the 118^th Congress was enactment of a continuing resolution (CR), HR 10545, that keeps the government funded through March 14, 2025. The House and Senate approved the measure by wide margins. The House vote was 366 to 34, with one member voting “present.” The 366 aye votes included 170 Republicans and all Democrats except the one (Rep. Jasmine Crockett of Texas) who voted present. The Senate vote, coming just minutes after midnight December 20 deadline, was 85 to 11. President Biden signed it into law on December 21. Thus, the threatened partial government shutdown was averted, despite a few hours on a Saturday during which funding for the government technically ran out.

The 119^th Congress convened January 3. The GOP controls the House and the Senate, and Republican President-Elect Trump will be in the White House as of January 20. Republicans are still squabbling a bit about which priority issue to tackle first, but whatever the order, a massive tax bill, Fiscal Year (FY) 2025 government funding, FY 2026 appropriations to fund the government, the statutory debt limit, and nomination confirmations will dominate early in 2025. On the regulatory front, once cabinet secretaries (and other key agency leaders) are confirmed, expect action to roll back Democratic rulemaking in many issue areas.

With only a little bit of drama, on January 3, House Republicans chose Rep. Michael Johnson (R-LA) to be Speaker of the House for the 119^th Congress. Virtually all Speaker votes are purely partisan, and this one was no exception. So, with a 219 to 215 GOP-to-Democrat edge, Rep. Johnson needed 218 votes to become Speaker. The final vote was 218 to 215—one Republican (Kentucky’s Rep. Thomas Massie) voted for someone else.

The hard-right wing of the Republican party in the House has written a letter to Speaker Johnson (R-LA) listing their demands for their support of early legislative initiatives this year. They include legislation to expand health savings accounts (HSAs), and “real” spending cuts “in place” ahead of approving a debt limit increase.

Both Republicans and Democrats have named the members joining the House Ways & Means and Senate Finance Committees for the 119^th Congress. These lawmakers will have particular influence over what goes in and what stays out of the massive tax bill Congress intends to enact this year.

The outgoing 118^th Congress must fund U.S. discretionary spending by December 20. Issues in play in that effort include extension of authority and funding for the National Flood Insurance Program (NFIP), delay of the Corporate Transparency Act’s (ACT’s) Beneficial Ownership Information (BOI) rule, and possibly technical corrections to SECURE retirement savings law.

In 2025-2026, Republicans will control the White House (Trump/President), the Senate (53 to 47), and the House (220 to 215). But despite winning the trifecta, GOP lawmakers will confront significant challenges next year. They include a spiraling deficit that will make enactment of GOP priorities difficult, and deep divisions between ultra-conservative and more centrist Republicans.