Congressional appropriators last night released text of the Financial Services and General Government and National Security, Department of State, and Related Programs Appropriations Act, 2026, that could be voted on in the House this week. The bill includes funding for the Treasury Department and Internal Revenue Service (IRS).

The package, which represents a bipartisan and bicameral compromise, provides $11.2 billion for the IRS, including $5 billion for enforcement, $3 billion for Taxpayer Services, and $3.2 billion for Operations Support, and omits a House provision preventing the IRS from creating a free tax filing program.

Government funding for nine of 12 annual appropriations bills expires January 30 (with the other three having received full-year funding in the November continuing resolution), but progress is being made. A procedural vote related to Senate consideration of the House-passed Commerce, Justice, Science/Energy and Water Development/Interior and Environment appropriations package (H.R. 6938) will be held after the Senate reconvenes today (Monday, January 12).

Health care — A group of senators that includes Susan Collins (R-ME) and Bernie Moreno (R-OH) last week was preparing a proposal to extend the enhanced Affordable Care Act (ACA) premium tax credits (PTCs) that expired at the end of December possibly for two years, potentially with an extended open enrollment deadline, an income limit, and a minimum payment requirement. Politico reported this morning that the group could release its proposal early this week.

Republicans in Congress have long contended that President Trump must get involved and back any potential resolution to the ACA credits issue. Asked on Fox News Sunday about Republican-backed reforms in the proposal and chances that it passes, Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Bill Cassidy (R-LA) said, "I can't yet tell you the chances that it passes because it has to conform first with what President Trump says he wants, which, by the way, I totally agree with. And that is, don't give 100% of the money to the insurance companies who take 20% of it for profit and overhead. Give the money to the patient … "

He said, "If the President weighs in, I think we can get something done. As always, the President on an issue like this — as Reggie Jackson, the baseball player, once said — is the straw that stirs the drink. And, so, the President coming to the table, helping us make a deal, I think we can go forward."

On Thursday, January 15 at 10 a.m., the Senate HELP Committee is set to hold an executive session to consider several health-related bills.

Trade — The House is back in session today and is planning to vote on nine bills on the suspension calendar, including two Ways and Means trade measures:

• the "AGOA Extension Act" (H.R. 6500), to extend the African Growth and Opportunity Act (AGOA) retroactively from September 30, 2025, to the end of 2028
• the "Haiti Economic Lift Program Extension Act" (H.R. 6504) to extend the HOPE/HELP textile and apparel trade programs with Haiti retroactively from September 30, 2025, to the end of 2028

Both bills have bipartisan support and have been discussed for inclusion in any potential bipartisan tax/trade/health package that addresses tax extenders, US-Taiwan tax relief, and other issues, though there is the lingering question of whether a legislative vehicle will be available for such a package.

Ways and Means Trade Subcommittee Chairman Adrian Smith (R-NE) announced a hearing on "Maintaining American Innovation and Technology Leadership" to be held on January 13.

Retirement — Later in the week is a planned House vote on the Protecting Prudent Investment of Retirement Savings Act (H.R. 2988), an Education and the Workforce Committee bill to amend the Employee Retirement Income Security Act of 1974 to specify requirements concerning the consideration of pecuniary and non-pecuniary factors. This is part of the Republican effort to codify the prohibition on retirement fund managers' factoring in environmental, social, and governance (ESG) issues in investment choices.

Housing — President Trump promised in December that he would, in the new year, announce housing reform plans. Last week, he posted on social media, "I am immediately taking steps to ban large institutional investors from buying more single-family homes, and I will be calling on Congress to codify it. People live in homes, not corporations." A story in the Saturday Washington Post said the Trump administration is preparing an executive order focused on housing and could include proposals "like helping home buyers withdraw from their 529 or 401(k) savings accounts to make down payments without incurring tax penalties." Additionally, "Officials are discussing expanding Opportunity Zones — an economic tool for investing in distressed areas — and other deregulatory policies as a means of boosting homeownership, as well," the story said.

Cryptocurrency — This week has emerged as a pivotal moment for the push to pass a regulatory market structure bill for digital assets. Both the Senate Banking Committee and Agriculture Committee have scheduled markups of their portions of the crypto bill for 10 a.m. Thursday. As of Monday morning, however, there was still no announcement that Banking Committee Democrats have agreed to the majority's latest offer on the bill, though the two sides have made progress in recent weeks. On the Agriculture Committee, which has jurisdiction over the bill's substantial portions on the Commodity Futures Trading Commission (CFTC), Sen. Cory Booker (D-NJ) has also not yet reached an accord with Chairman John Boozman (R-AR) on the bill. If a bipartisan agreement is not completed this week, party-line markups would serve to advance the bill to the floor, in the presumption that talks would continue and remaining issues with Democrats could be resolved in a substitute amendment whenever the full Senate considers the bill. Senate leaders are unlikely to set aside floor time for the bill unless sponsors can recruit 60 votes in favor.

Points of contention between Republicans and Democrats reportedly include: 1) whether to allow stablecoin platforms to pay yield in the forms of rewards, a practice that banks object to; 2) technical challenges in devising national security controls for decentralized finance (DeFi) platforms that have no central intermediary; and 3) ethics controls covering the President and the White House staff. Punchbowl News reported that Sen. Ruben Gallego (D-AZ), a leader of the Democrats' crypto negotiating group, last week had said Republicans would not have the votes to advance a market structure bill in the Senate unless the bill includes ethics limits that cover the President.

Federal Reserve — Fed Chairman Jerome Powell released a statement Sunday evening saying he was being threatened with a criminal indictment by the Justice Department because the Fed had done "what will serve the public, rather than following the preferences of the President." In his statement, Powell said that on Friday (January 9), "the Department of Justice served the Federal Reserve with grand jury subpoenas, threatening a criminal indictment related to my testimony before the Senate Banking Committee last June. That testimony concerned in part a multi-year project to renovate historic Federal Reserve office buildings." Powell said he had "deep respect for the rule of law and for accountability in our democracy. No one — certainly not the chair of the Federal Reserve — is above the law. But this unprecedented action should be seen in the broader context of the administration's threats and ongoing pressure." Powell said "this new threat" from DOJ was not actually about the "pretexts" of his testimony or the renovation, but instead "a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President." Powell said, " I will continue to do the job the Senate confirmed me to do, with integrity and a commitment to serving the American people."

Banking Committee member Sen. Thom Tillis (R-NC) criticized the administration for the investigation, telling Politico last night that he would "oppose the confirmation of any nominee for the Fed — including the upcoming Fed Chair vacancy — until this legal matter is fully resolved." With the Banking Committee at a 13-11 ratio, a defection by Tillis could prevent approval of the President's forthcoming Fed chair nominee in committee if all Democrats were to vote against.

Today, January 12, at 10 a.m. is the EY Webcast, "BEPS 2.0 Pillar Two: the latest OECD releases — first impressions." Register.