TCJA Tax Cuts, $340 Billion Budget Bill, and New BOI Reporting Deadline
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Tax Policy/News:
February 24: Musk’s Influence and New IRS Bills Could Reshape Tax Season
As tax season unfolds, major changes at the IRS—including mass layoffs, hiring freezes, and proposed legislation—are raising concerns about enforcement and efficiency.
President Trump’s executive orders have halted IRS hiring, while Elon Musk’s Department of Government Efficiency is pushing for deep federal workforce reductions. Meanwhile, new legislation, including the Electronic Filing and Payment Fairness Act and the IRS Math and Taxpayer Help Act, aims to modernize filing procedures and enhance transparency in tax error corrections.
A draft agreement could also grant White House officials expanded access to taxpayer data, sparking privacy concerns. Separately, decentralized finance (DeFi) firms have won a temporary reprieve from new tax reporting rules, reflecting a pro-crypto stance from the administration.
The IRS employee union has criticized Trump’s federal worker buyout plan, calling it a "bait-and-switch" after affected employees were told they must continue working through tax season. As Congress debates tax policy and enforcement funding, the future of IRS operations remains uncertain, with potential long-term implications for revenue collection and compliance.
February 24: White House to Host Weekly Tax Discussions with Congressional Leadership
The White House will begin hosting weekly tax discussions with top congressional Republicans to advance President Trump’s tax agenda.
Treasury Secretary Scott Bessent will lead the meetings, joined by Senate Majority Leader John Thune, House Speaker Mike Johnson, and key tax committee chairs. The discussions aim to resolve GOP divisions over tax policy, including extending expiring provisions from the 2017 Tax Cuts and Jobs Act.
House Republicans have set a $4.5 trillion cap on tax cuts in their budget, but Senate Republicans argue this may not be enough to cover all planned extensions. The meetings come as the House prepares for a budget vote, highlighting the ongoing debate over fiscal priorities and deficit concerns.
Trump’s tax plan, which includes new deductions and incentives, remains a central issue in negotiations. The outcome of these talks will shape the administration’s broader economic strategy.
February 20: Will Trump and Congress Extend TCJA Tax Cuts?
Key provisions of the 2017 Tax Cuts and Jobs Act (TCJA) are set to expire at the end of 2025, prompting debate over their extension.
With a Republican-led White House and Congress, lawmakers are expected to preserve many TCJA provisions but must find funding sources to offset revenue losses. The House GOP has proposed up to $4.5 trillion in tax cuts alongside at least $1.5 trillion in spending cuts, while Senate Republicans prefer a separate tax bill after addressing border security and defense.
The TCJA reduced corporate tax rates to 21% permanently, but individual tax cuts, the SALT deduction cap, and business deductions are temporary. If not extended, tax rates will rise, the standard deduction will shrink, and the child tax credit will decrease.
Possible outcomes include a long-term extension through reconciliation, a short-term renewal, or expiration, which could create uncertainty for businesses and taxpayers. With tax policy negotiations intensifying, the fate of the TCJA remains a critical legislative issue.
February 20: IRS Layoffs Could Hurt Revenue Collection and Foil Efforts to Go After Rich Tax Dodgers, Experts Say
The IRS has begun laying off approximately 7,000 probationary employees, primarily compliance staff, in what experts warn could severely undermine tax enforcement and revenue collection.
The layoffs, occurring just weeks before the tax filing deadline, coincide with broader efforts by the Department of Government Efficiency to reduce federal spending. Analysts argue the cuts will disproportionately affect audits of high-wealth tax evaders and corporations, potentially leading to billions in lost revenue.
The Inflation Reduction Act had previously bolstered IRS resources, but Republican-led budget reductions have rolled back much of the funding. Treasury Secretary Scott Bessent defended the cuts, asserting that the U.S. has a “spending problem, not a revenue problem.” Critics, including tax policy experts and union leaders, warn the move could slow refund processing, encourage tax avoidance, and increase the deficit.
The National Treasury Employees Union has filed legal challenges against the layoffs. With Congress debating how to fund Trump’s proposed tax cuts, the impact of these IRS reductions remains a key fiscal concern.
Economic News/Policy:
February 21: Senate Republicans Approve Budget Framework, Pushing Past Democratic Objections After All-Night Vote
Senate Republicans approved a $340 billion budget framework early Friday after an all-night voting session, moving forward on President Trump’s immigration and defense priorities.
The 52-48 vote, largely along party lines, allows up to $175 billion for border security and mass deportation operations, $150 billion for the Pentagon, and $20 billion for the Coast Guard. While Democrats attempted to block the package with amendments targeting tax breaks for billionaires and safety net protections, Republicans used their majority to push the measure through.
The resolution now directs Senate committees to finalize spending details before another vote. The GOP insists the budget will be funded through spending cuts and new revenue sources, such as rolling back the Biden administration’s methane emissions fee. Meanwhile, the House pursues a broader bill combining tax cuts and spending reductions, creating tensions between the two chambers.
Trump has signaled openness to the Senate’s approach but continues to push for a single, comprehensive bill. The debate over tax policy and spending cuts is set to continue in the coming months.
February 19: Senate Confirms Kelly Loeffler, Former Georgia Senator, to Lead Small Business Administration
The Senate has confirmed Kelly Loeffler as Administrator of the Small Business Administration (SBA) in a 52-46 vote.
A former U.S. senator and business executive, Loeffler returns to Washington as a key Trump ally. The SBA, founded in 1953, provides financial and advisory support to small businesses, including disaster relief loans. Loeffler briefly served in the Senate after being appointed in 2019 but lost her 2021 runoff election in Georgia.
Since then, she has been active in GOP fundraising and voter registration efforts. Her confirmation adds another wealthy business leader to Trump's Cabinet, as she and her husband, Jeffrey Sprecher, CEO of Intercontinental Exchange, hold significant financial influence.
Loeffler’s leadership at SBA will focus on supporting small businesses amid ongoing economic challenges. Her appointment reflects Trump’s continued preference for business-minded officials in his administration.
February 19: White House Claims Authority Over FERC, Other Independent Agencies
A new executive order from the White House asserts authority over the Federal Energy Regulatory Commission (FERC) and other independent agencies, requiring them to submit regulatory actions for review.
President Trump’s order argues that these agencies exercise substantial executive power without adequate presidential oversight, undermining accountability. The directive mandates that FERC and similar agencies align policies with White House priorities and consult with key administration officials.
However, legal experts note that FERC’s statutory independence under the Department of Energy Organization Act may limit the executive order’s reach. The administration also claims authority to remove members of the Federal Trade Commission, National Labor Relations Board, and Consumer Product Safety Commission. Legal analysts suggest this could extend to FERC, raising concerns about energy policy stability.
The Department of Justice plans to challenge a 1935 Supreme Court precedent protecting agency tenure, potentially leading to more frequent FERC leadership changes. Regulatory uncertainty may increase if firings are challenged in court. The long-term impact on independent agency autonomy remains uncertain.
February 19: Trump Says ‘Inflation Is Back’: ‘I Had Nothing to Do with That’
President Trump distanced himself from recent inflation increases, attributing the rise to spending under the Biden administration.
In a Fox News interview with Elon Musk, Trump criticized the Inflation Reduction Act, calling it a “scam” and blaming Biden-era policies for economic strain. The consumer price index rose 3% in January, up from 2.9% in December, with rising costs for gas, housing, and groceries. While experts warn that Trump’s economic policies, including tax cuts and tariffs, could contribute to inflation, he remains focused on reducing government spending.
The Department of Government Efficiency, led by Musk’s advisory team, reported $55 billion in identified savings last month, with a goal of cutting $1 trillion. Trump acknowledged challenges in implementing his policies due to legal battles.
Musk expressed confidence in uncovering further spending reductions, aligning with Trump’s push for fiscal efficiency. The administration’s approach to inflation and government spending continues to spark debate as economic concerns grow.
Following a federal court ruling reinstating beneficial ownership information (BOI) reporting requirements under the Corporate Transparency Act (CTA), FinCEN has extended the reporting deadline by 30 days to March 21, 2025.
The extension allows businesses more time to comply while FinCEN evaluates potential further modifications. Reporting companies with deadlines later than March 21 must adhere to their original dates.
Additionally, certain plaintiffs in National Small Business United v. Yellen remain exempt from reporting for now. FinCEN also plans to revise BOI reporting rules this year to reduce burdens on lower-risk entities, particularly small businesses. BOI reports can be submitted via FinCEN’s E-Filing system.
This update follows legal challenges that temporarily halted reporting enforcement, but with the recent court decision, compliance is once again mandatory. FinCEN will provide further updates as necessary.
Technology:
February 24: In Texas, ‘Energy Dominance’ Is the Solar Industry’s New Motto
Texas solar industry leaders are rebranding renewable energy as a key driver of “energy dominance” to gain political support in a fossil fuel-heavy state.
Solar and battery storage contributed more power to the Texas grid in 2024 than any other source, generating billions in tax revenue and landowner payments. Despite this, the industry faces legislative hurdles, especially after recent elections replaced solar-friendly lawmakers with conservatives skeptical of renewables.
Advocates are pushing consumer protection regulations while emphasizing the role of solar energy in economic growth and grid reliability. The national outlook is also uncertain, as the Trump administration has frozen clean energy funding and imposed restrictions on renewable development.
However, with rising energy demand from AI-driven data centers and industrial expansion, solar remains a fast-growing power source. Industry leaders warn that ending federal investment tax credits could severely impact future projects, highlighting the ongoing political battle over the future of U.S. energy policy.
Energy and Environmental Policy/News:
February 21: The GSA Is Shutting Down Its EV Chargers, Calling Them ‘Not Mission Critical’
The General Services Administration (GSA) is shutting down all federally managed EV charging stations, citing them as “not mission critical.”
The agency, responsible for federal buildings and vehicle fleets, is also preparing to offload newly purchased EVs. This move aligns with President Trump’s broader rollback of Biden-era EV policies, including halting a $5 billion public charging program and rescinding federal EV purchasing mandates.
The GSA’s decision impacts approximately 8,000 charging plugs nationwide, used by both government and personal vehicles. Employees have been instructed to take chargers offline, and network contracts will soon be canceled.
The administration has also removed an interactive map showing GSA-owned chargers. It remains unclear whether the EVs will be sold or stored, and whether other federal agencies will follow suit. Critics warn the shift could slow EV adoption and increase emissions, while the administration continues efforts to reduce federal spending and reshape energy policy.
February 18: EV Nonprofit Holds Out Hope for Embattled IRA Tax Credits
Despite President Trump’s rollback of nationwide EV sales targets, federal tax credits for electric vehicle purchases remain intact under the Inflation Reduction Act.
EV advocacy nonprofits, including Generation180 and the Electric Vehicle Association, are urging consumers to contact legislators to protect these incentives. Experts suggest that rolling back EV tax credits may be difficult without congressional approval, especially as new battery and EV plants create jobs in key states.
However, the Trump administration has frozen spending on EV charging infrastructure, a move seen as more damaging to industry growth than eliminating vehicle purchase incentives. While this could slow EV adoption, experts believe long-term consumer preference and automaker investments will sustain growth. Automakers, including General Motors and Toyota, have urged the administration to reinstate funding for charging infrastructure.
If federal support dwindles, some manufacturers may seek private funding for charging expansion. The loss of tax credits could disproportionately affect lower-income buyers, potentially hindering U.S. competitiveness in the EV market. Advocates argue that EV policies should be framed as economic and innovation drivers rather than solely environmental initiatives.
For Fun:
February 19: How Chronic Stress Warps Decision-Making
A new study in Nature reveals how chronic stress alters brain function, shifting decision-making from thoughtful choices to rigid habits.
Researchers found two neural pathways in the amygdala that influence this shift, based on experiments in mice. Stressed mice continued pressing a lever for food even when full, indicating automatic behavior, while unstressed mice adjusted their actions based on need. One neural pathway, active in unstressed mice, supports flexible decision-making but was dampened by stress.
Another pathway, highly active in stressed mice, reinforced habitual behavior. Using optogenetics, scientists restored goal-directed behavior in stressed mice by stimulating the suppressed pathway. Experts believe similar mechanisms exist in humans, potentially contributing to conditions like anxiety and addiction.
These findings could pave the way for targeted treatments that address stress-induced behavioral changes. The study underscores the profound impact of chronic stress on cognitive flexibility and decision-making.