Republican leaders want to hold a full House vote as early as today (Wednesday, May 21) or Thursday on the budget reconciliation bill with extensions of Tax Cuts & Jobs Act (TCJA) provisions expiring at the end of 2025 as its centerpiece. They appear closer to securing requisite GOP support after President Trump spoke to the House Republican Conference Tuesday morning to push reluctant members to vote for the bill. A manager's amendment detailing changes to accelerate the Inflation Reduction Act (IRA) green energy rollbacks, further increase the individual state and local tax (SALT) deduction cap and perhaps include other modifications hasn't been released at the currently ongoing House Rules Committee meeting that began at 1 a.m., but agreements on those issues appeared within reach.

House Majority Leader Steve Scalise (R-LA) said Tuesday that a "rough agreement" had been reached to accelerate some IRA rollbacks in the Ways and Means portion of the bill, Bloomberg Government reported. Press reports Tuesday described the potential for a SALT agreement to set a $40,000 cap per household for incomes under $500,000 for 10 years, with the cap and income threshold set to grow 1% each year. House Speaker Mike Johnson (R-LA) said on CNN this morning that an agreement had been reached for a SALT cap of $40,000.

During the Tuesday conference meeting, President Trump told members not to change Medicaid further than what has been proposed, and to stop trying to change the bill and pass it. Freedom Caucus Chair Andy Harris (R-MD), who was "a hard no" prior to the meeting, said after the meeting that conservative members had backed off their demands for steeper Medicaid cuts after President Trump's comments.

With the 220-213 majority, House Republicans can only lose the votes of three members to pass the GOP-only reconciliation bill. While support has been increasing among Republican holdouts, Politico reported that leaders may head to the floor prior to having all the needed votes firmly in place. "The thinking, several of the Republicans said, is that some members will keep asking for more time until leaders finally call the question: Are you with Trump and your Republican colleagues, or aren't you?" the report said. "And if they insist on voting the bill down, the belief is they would eventually crumble under fierce public pressure from constituents and MAGA loyalists furious about the failure of Trump's signature bill." Congress is set to be out next week.

Whatever may eventually pass the House is likely to be modified in the Senate, and there has been some speculation that the bill may skip the committee process in that chamber. Punchbowl News this morning reported Senate Majority Leader John Thune (R-SD) as saying, "I'm a regular order guy. I think you can improve the product … But obviously, depending on what happens in the House and the timeline we have to work with, getting committees up and going and doing their thing takes a while — and how ready the product is for prime time … There are certain things the Senate wants to have its imprint on."

Tips — One issue addressed in the House bill, no tax on tips, was approved unanimously as a Senate bill May 20. The No Tax on Tips Act was sponsored by Senator Ted Cruz (R-TX) and brought up for unanimous consent approval by Senator Jacky Rosen (D-NV), whose state has a large number of service industry workers. No Senator objected. "Nevada has more tipped workers per capita than any other state. So this bill would mean immediate financial relief for countless hard working families," Senator Rosen said.

A Congressional Research Service description of the bill said:

• "Under the bill, the new tax deduction for tips is limited to cash tips (1) received by an employee during the course of employment in an occupation that customarily receives tips, and (2) reported by the employee to the employer for purposes of withholding payroll taxes. (Under current law, an employee is required to report tips exceeding $20 per month to their employer.)
• Further, an employee with compensation exceeding a specified threshold ($160,000 in 2025 and adjusted annually for inflation) in the prior tax year may not claim the new tax deduction for tips.
• Finally, the bill expands the business tax credit for the portion of payroll taxes that an employer pays on certain tips to include payroll taxes paid on tips received in connection with barbering and hair care, nail care, esthetics, and body and spa treatments. (Under current law, an employer is allowed a business tax credit for the amount of payroll taxes paid on certain tips received by an employee in connection with providing, delivering, or serving food or beverages.)"

IRS — During the May 20 Senate Finance Committee hearing on his nomination to be IRS Commissioner, former Rep. Billy Long (R-MO) pledged to pursue a culture shift to increase IRS employee access to the agency's leadership and improve morale. Democrats asked questions about his personal business dealings with tribal tax credits and his use of campaign funds.

Senator Marsha Blackburn (R-TN) asked about remote work for IRS employees, and Rep. Long described lengthy wait times for IRS customer service. Democrat Maggie Hassan (D-NH) also described the agency's customer service woes, and others questioned how that could be remedied with a reduced workforce.

Rep. Long's response to questions from Senator Elizabeth Warren (D-MA) regarding presidential interference with the IRS weren't sufficient to satisfy her and Senator Warren said he should not be anywhere near the leadership of the IRS. He later said he wouldn't accept politicization and weaponization of the agency. "It's not going to happen on my watch," he said.

Rep. Long was agreeable to Senator Todd Young's (R-IN) call for IRS modernization legislation. Senator James Lankford (R-OK) noted the reintroduction of Office of Information and Regulatory Affairs (OIRA) review of tax regulations during the second Trump administration, to ensure regulations are issued on a timely basis and with proper oversight. Long said a cost-benefit analysis and consistency are required.