On May 18, 2025, the House Budget Committee gave its nod to a significant piece of legislation known as “The One, Big, Beautiful Bill.” This bill, poised for revision by the House Rules Committee, is gearing up for a vote on the House floor. It represents a sweeping continuation and expansion of the 2017 Tax Cuts and Jobs Act, introducing a myriad of new provisions aimed at reshaping the tax landscape for businesses, individuals, and tax-exempt organizations alike.
Business Provisions
The House Bill extends several key business provisions. Notably, the definition of “adjusted taxable income” under section 163(j) will be based on EBITDA from 2025 to 2028, a move that is favorable to taxpayers. The deduction for qualified business income under Section 199A is increased to 23%, and the global intangible low-taxed income (GILTI) provisions are made permanent at a 10.5% rate. Additionally, the base-erosion and anti-abuse tax (BEAT) is set to remain at 10.5% permanently.
Other notable business provisions include the reestablishment of Opportunity Zones for 2027 through 2033, with a focus on rural areas, and the limitation of amortization deductions for sports franchises to 50% of the adjusted tax basis.
Tax-Exempt Provisions
For tax-exempt organizations, the bill proposes an increased excise tax on private university endowments and private foundations. The current 1.4% excise tax on net investment income of private colleges is replaced with a tiered system, with rates reaching as high as 21% for institutions with significant endowments. Private foundations face a similar tiered excise tax system based on asset size.
Individual Provisions
Individuals will see the maximum ordinary income tax rate of 37% made permanent. The standard deduction is increased for various filing statuses from 2025 to 2028. The bill also proposes the permanent repeal of the personal exemption and adjustments to itemized deduction limits.
Additionally, the bill introduces the concept of “MAGA” accounts, tax-exempt trust accounts for U.S. citizens under 18, with a one-time $1,000 federal credit for eligible children born between 2025 and 2028.
For a detailed breakdown of these provisions, refer to the original article on Tax Talks. This comprehensive analysis explores the implications of the bill across various sectors, providing insights into its potential impact on the economic landscape.
