The House Ways and Means Committee approved by a 26-19 vote at around 8 a.m. this morning (May 14) its full package of tax provisions and revenue offsets to accompany extensions of Tax Cuts & Jobs Act (TCJA) provisions expiring at the end of 2025, which was released on Monday afternoon and — at nearly 400 pages — is much broader than the TCJA-focused preliminary version released at the end of last week. Democrats took issue with the two-part rollout at the top of the markup, which began with a lengthy walkthrough then member statements before consideration of Democratic amendments on a variety of tax, trade, and health issues under the jurisdiction of the Committee, all of which were voted down during a more than 17-hour markup.

Some of the broad categories of the bill are:

• TCJA extensions consistent with the preliminary language released last Friday, though the IRC Section 199A deduction was increased further to 23% and, in place of the Pease limitation, there was the addition of a limitation on the tax benefit of itemized deductions of 35% that would generally affect only taxpayers in the top income tax bracket of 37%, plus other changes
• Extension of TCJA pre-cliffs on bonus depreciation, IRC Section 163(j) interest deductibility, and IRC Section 174 R&D expensing, which are generally extended 2025—2029
• Provisions reflecting President Trump's proposals on no tax on tips, no tax on overtime, no tax on car loan interest, a deduction for seniors, and accelerated depreciation for factories, plus MAGA accounts for children
• Revenue offsets addressing issues including sports team amortization, higher education endowment taxes, private foundation taxes, unrelated business income, an executive compensation aggregation rule, immigration issues, fraud, waste, and abuse provisions for health care and COVID programs, earned income tax credit reforms, etc.
• A robust package of Inflation Reduction Act (IRA) energy tax credit rollbacks
• Changes to family-based tax credits and savings accounts for education and health care

As a general matter, a fair amount of the revenue offsets contemplated for businesses were omitted from the plan in favor of tax increases elsewhere. Carried interest is not addressed despite President Trump's reported push for the issue to be included.

The revised Joint Committee on Taxation estimate, which estimates the total cost of the Ways and Means package at $3.7 trillion, is available here.

A summary of the provisions as released on Monday is available here.

The Ways and Means bill included an increase in the state and local tax (SALT) deduction cap to $30,000 that is reduced for income above $400,000, though there was the understanding that the issue would continue to be deliberated. Talks continued last night with Republican leaders and members from high-tax states, and House Speaker Mike Johnson (R-LA) expressed hope that a resolution would be reached soon. Rep. Nick LaLota (R-NY), an outspoken critic of the Republican leadership's handling of the SALT issue who maintains he won't vote for a bill without adequate relief from the cap, called the Ways and Means bill as proposed "dead effectively on the floor," Politico reported.

The House Energy and Commerce Committee markup proceeded concurrently with the Ways and Means markup. The Congressional Budget Office estimated that Medicaid changes under the Committee's recommendations could lead to 7.6 million people going uninsured. Medicaid changes remain a concern for Republicans in the House and the Senate. The Energy and Commerce Committee also addressed changes affecting energy programs and other issues.

"Fiscal hawks" continue to declare that they won't back a bill without sufficient savings. Rep. Chip Roy (R-TX), a Freedom Caucus member, has been active on social media criticizing the emerging House bill for failing to both meaningfully reduce the deficit and include "transformative changes on Medicaid," and calling for IRA energy tax credits to be fully repealed. With the 220-213 majority, House Republicans can only lose the votes of three members to pass the GOP-only reconciliation bill.

The reconciliation recommendations approved by committees will be assembled by the House Budget Committee during a markup scheduled for Friday, May 16 at 9 a.m., and the legislation will subsequently proceed to the Rules Committee and the House floor, with any unresolved issues, including SALT cap relief, likely addressed along the way.

Whatever may eventually pass the House is likely to be modified in the Senate, which could be a backstop for revenue increases and other proposals. Senators are increasingly raising concerns about the House legislation, and some have previously said the reconciliation effort in general should stick to TCJA provisions and little else, on tax and otherwise. "It's not beautiful yet," said Sen. Lisa Murkowski (R., Alaska) of the legislation in the Wall Street Journal, referring to the "one big, beautiful bill" moniker adopted by President Trump and House Republicans. (The report said, in the House, "Rep. Juan Ciscomani (R., Ariz.) and some other Republicans were … frustrated about the planned phaseout of tax credits for producing solar- and wind-energy parts, battery components and inverters.")

Politico May 13 reported on Senate concerns with the depth of IRA energy tax credit cuts. Senator Kevin Cramer (R-ND) said the House proposal "to phase out technology-neutral clean electricity tax credits beginning in 2029 would kneecap newer technologies that Republicans favor like advanced nuclear reactors and geothermal that are not ready to be deployed at large scale. 'They definitely need more time than that,' Cramer said. 'It's too short for truly new technologies. We'll have to change that. I don't think it's fair to treat an emerging technology the same as a 30-year-old technology.'"

Asked about member concerns over Medicaid, energy provisions, and deficit reduction with regard to the House legislation, Senate Majority Leader John Thune (R-SD) said following the regular Tuesday party lunches, "When it comes over here, we will be prepared for various contingencies, obviously one of which could be taking up the House bill and then offering a Senate substitute, but we'll see what ultimately they're able to get done. But I feel very good about where we are, where they are, and where, ultimately, we are going to be on that bill as well."

"We are, both the House and the Senate, trying to stay as close as we can on policies," Senate Finance Committee Chair Mike Crapo (R-Idaho) said in a Punchbowl News story this morning, titled 'Yes. The Senate will change the GOP reconciliation bill.' "That being said, the House is going to have a different work product than we end up with here."

Senator Ron Johnson (R-WI) is one of the members critical of the effort, and he took an additional step of recommending in a May 12 WSJ op-ed that Republicans revert to the original Senate plan to pass a reconciliation bill on border security and defense priorities first, then another on TCJA extensions, and then separately address President Trump's tax proposals and TCJA pre-cliffs. Senator Johnson successfully pushed for pass-through tax benefits when the TCJA was considered in 2017.

"I don't see any scenario where it's going to be deficit neutral. That's my problem," Senator Johnson said of the current reconciliation effort, as reported by NBC. "By my calculation, this is going to increase the deficit by $4 trillion."

Congress — Today, Wednesday, May 14 at 10 a.m., the Senate Finance Committee is set to hold a hearing on Trade in Critical Supply Chains.

The Finance Committee has scheduled votes on the nominations of James O'Neill to be Deputy Secretary of Health and Human Services and Gary Andres to be an Assistant Secretary of Health and Human Services for Thursday, May 15 at 10 a.m.

The Finance Committee has set a hearing for Tuesday, May 20 at 10 a.m. on the nomination of former Rep. Billy Long (R-MO) to be IRS Commissioner.

Today, Wednesday, May 14 at 2 p.m. is the EY Webcast, "What's in the House W&M Committee tax bill and what it means for businesses."