The dust continues to settle after the whirlwind passage and signing of the "One Big, Beautiful Bill" (Public Law No. 119-21 or the Act) last week, with the focus on regulatory implementation of energy tax credit modifications, international provisions, Trump proposals like no tax on tips and overtime, and Trump Accounts for children, plus some provisions that members of Congress want changed. Some early turmoil over appropriations bills being considered at the committee level in the Senate and the chamber's impending vote on a rescissions package is foreshadowing difficulty for the two parties and chambers in reaching agreement on a spending bill before the September 30 expiration of government funding.

Regarding implementation of modifications to energy tax credits under the Inflation Reduction Act (IRA), President Trump's July 7 executive order (EO) calling on Treasury "to strictly enforce the termination of the clean electricity production and investment tax credits under sections 45Y and 48E of the [IRC] for wind and solar facilities" has been a focus in the press. The EO, which also called for action "to ensure that policies concerning the 'beginning of construction' are not circumvented," is widely recognized as stemming from assurances made by President Trump to conservative House Republicans concerned with the approach to energy credits taken in the Senate version of the Act.

The Senate bill allowed wind and solar projects to be eligible for the credits if placed in service by December 31, 2027, and extended the tax credit timeline such that facilities retain full credit value if they begin construction within one year of the date of enactment. "In a last-minute deal last week, Senate and House Republicans agreed to allow wind and solar facilities that break ground within 12 months to receive subsidies for several years," said a story in the July 10 Washington Post. The story cited some who say the EO's language on beginning construction could reduce the number of projects that qualify for the credits through guidance that would "tighten up the definitions."

Politico reported that the late Senate change that "offers more time for projects that begin construction in the next 12 months … is now in doubt. Trump's executive order directs the Treasury Department to get rid of the credits as quickly as possible, including by potentially rewriting long-standing rules that define when a project is considered to have started construction." The story further said, "For clean energy developers, the order represents a potential threat to the window of certainty — albeit a short one — that Senate moderates had given them to get their projects online and be assured of receiving the credits."

There has also been attention on the Senate's change regarding the deduction for gambling losses. Senator Catherine Cortez Masto (D-NV) July 9 introduced legislation to reinstate the prior rules (S. 2230) that she said is required because the "bill that they passed last week changed the tax code to only allow a 90% deduction on gambling losses." She unsuccessfully sought unanimous consent for Senate passage of the bill, which is cosponsored by Senators Jacky Rosen (D-NV) and Ted Cruz (R-TX), on July 10. "Unfortunately, tucked into the Republicans' tax bill was a provision that puts the industry at risk not just in Nevada but across the country," she said. "Until last week, the law of the land was that gamblers could deduct 100% of their losses from their annual taxes." Rep. Dina Titus (D-NV) sponsors the House version (H.R. 4304).

"For gamblers, the change means they could owe more taxes if they lose money or win by slim margins … " said a story in today's Wall Street Journal. "The change to loss deductions could have major implications for the finances of high rollers and professional gamblers." The story cited a Finance Committee spokeswoman as saying the change was made because of the current policy baseline that assumed no cost to extend current provisions, meaning each needed to be changed to comply with reconciliation rules.

A Washington Post story said, "In practice, for example, under the old rule, someone who wins $100,000 and loses $100,000 could deduct the full $100,000 in losses and owe nothing. Under the new rule, they would only be able to deduct $90,000 and would still owe taxes on the remaining $10,000, despite having lost all their winnings." The story said, "Some senators have said they weren't aware of the provision, and it only publicly came to light days ahead of the bill's passage, with professional gamblers and media figures drawing attention to it."

Government funding — The Senate Appropriations Committee's consideration of three FY2026 spending bills promises to be fairly harmonious for two of the measures, Agriculture and Legislative Branch; the Commerce-Justice-Science bill, however, has become contentious because of Senator Chris Van Hollen's (D-MD) insistence on using funding for a new FBI headquarters only for a facility built in Maryland. The Trump administration has proposed keeping the FBI at a new location in Washington. Punchbowl News reported July 10 that Senator Van Hollen said the tussle with the Administration could extend to other projects and "that he doesn't think the bill can get 60 votes without his FBI language."

As has typically been the case in recent years, Senate spending bills propose to increase funding over the current year while House bills proposed thus far generally cut funding. The September 30 expiration of government funding is the next deadline Congress faces, and a government shutdown is possible absent agreement.

Senate Majority Leader Chuck Schumer (D-NY) is seen as suggesting that Democratic cooperation on government funding depends on whether the Senate approves a rescissions package. "We are doing everything we can to keep the bipartisan appropriations process going," he said July 9. "And they're undermining it with rescissions, with pocket rescissions, with impoundment, and every other way."

The House June 11 approved — narrowly, 214-212 — a package of budget rescissions (H.R. 4), which would claw back $9.4 billion in approved spending on programs such as the U.S. Agency for International Development (USAID), the World Health Organization, the United Nations Children's Fund (UNICEF) and the public broadcasting networks PBS and NPR. A Senate vote on the bill is expected next week.

"It is very important that all Republicans adhere to my Recissions Bill and, in particular, DEFUND THE CORPORATION FOR PUBLIC BROADCASTING (PBS and NPR), which is worse than CNN & MSDNC put together," President Trump posted on social media last night.

Global tax — An EY Alert, "G7 issues statement on global minimum taxes," is available here .