This week (February 9-13)

Congress: The House and Senate are in session.

On Tuesday, February 10 at 10 a.m., the House Ways and Means Committee is scheduled to hold a hearing on "Foreign Influence in American Non-profits: Unmasking Threats from Beijing and Beyond."

The Senate Finance Committee has noticed a hearing entitled, "The U.S.-Mexico-Canada Agreement: Evaluating North American Competitiveness," on Thursday, February 12, at 10:00 AM. The hearing comes as the U.S., Mexico, and Canada prepare for the statutory review of the free trade agreement. Witnesses will include:

• Kevin Brady, Former Chairman of the House Ways and Means Committee
• Eric Gottwald, AFL-CIO
• Paul McCarthy, Vehicle Suppliers Association
• Ted Vander Schaaf, Vander Schaaf Farms, an Idaho dairy farm

Last week (February 2-6)

Big picture: With most of the government now funded through September 30 in an appropriations bill that included an extension of trade programs, the African Growth and Opportunity Act (AGOA) and the Haiti Economic Lift Program, and a significant package of health provisions, the question becomes what's next for the congressional agenda. Aside from crafting reforms to Department of Homeland Security (DHS) enforcement procedures, a near-term focus could be on housing legislation, which is part of the affordability agenda being pursued by both parties. The House "Housing for the 21st Century Act" addresses housing supply issues, rural housing, affordable housing, transparency, consumer protection, and other areas. The Senate Banking Committee's bipartisan "ROAD to Housing Act" addresses issues including zoning and land use, manufactured and modular housing, homeownership, federal rental assistance, and incentives to build and renovate homes. Both are teed up for consideration in their respective chambers soon, have overlapping provisions — though the Senate bill has some that won't be supported by House Republicans — and could produce a compromise bill. The White House has indicated it would welcome housing legislation, and the President has his own demand-based proposals, in contrast to the housing supply-focused proposals in Congress.

More generally, with a group of senators working on a proposal to address enhanced Affordable Care Act (ACA) premium tax credits (PTCs) that expired at the end of 2025 declaring the effort essentially dead this week, members will be looking for other ways to address affordability. In a February 5 Punchbowl News report, Rep. Brian Fitzpatrick (R-PA) enumerated other affordability priorities, including housing, food, fuel, childcare, elder care and transportation. "It's all unaffordable right now," he said.

Also on the horizon, the President's State of the Union Address is set for February 24. An FY2027 budget is also expected, though at least one member of Congress, House Appropriations Committee Chairman Tom Cole (R-OK), has said the spending blueprint may not arrive until March. Later this year, both a next highway bill, or a stopgap extension, and a new farm bill (or extension) are due September 30, 2026.

Energy tax: On February 3, Treasury and IRS released proposed regulations (REG-121244-23) regarding the IRC Section 45Z Clean Fuel Production Credit enacted by the Inflation Reduction Act of 2022 and amended by the "One, Big, Beautiful Bill Act" (OBBBA). The proposed regulations would provide rules for determining clean fuel production credits, including credit eligibility rules, emissions rates, and certification and registration requirements.

"The proposal incorporates changes from Republicans' reconciliation bill, including the exclusion of indirect land use changes from determining emissions rates and restricting eligibility to feedstocks grown in the United States, Canada and Mexico," Politico reported. "It also addresses looming questions around the term 'qualified sale.' It proposes clarifying that the term 'sold for use in a trade or business' includes the sale of fuel to an unrelated person that subsequently resells the fuel in its trade or business. And it made clear 'fuel' would not include electricity production."

"The biofuels industry got a win with Tuesday's IRS proposal to implement the Section 45Z clean fuel production credit," the Bloomberg Daily Tax Report said. "After years of seeking guidance, fuel producers will now have greater certainty, likely spurring investment, biofuel groups said." Tax Notes said the regulations "offer guidance to address previous taxpayer concerns regarding elective payments and credit transfers, qualified sales, and determining emissions rates."

Bill introductions: On February 2, Senator Jerry Moran (R-KS) and a bipartisan group of cosponsors (Senators Cortez Masto, Ernst, and Klobuchar) introduced the Securing America's Fuels (SAF) Act (S. 3759), to reinstate the special rate calculation of the clean fuel production credit with respect to sustainable aviation fuel, and to extend the credit through 2033. The bill would reinstate the SAF bonus credit that would allow qualifying SAF producers to receive up to $0.35 or $1.75 per gallon, and it would extend the 45Z Clean Fuel Production Tax Credit for all clean fuels through 2033.

Cryptocurrency: During the Thursday Senate Banking Committee hearing with Treasury Secretary Scott Bessent, Senator Cynthia Lummis (R-WY), who has a crypto tax proposal addressing a de minimis threshold and other issues, asked Bessent when "digital assets that might be used as a means of exchange … will it be a capital gain, or will it be exempt from capital gains when it's used as a means of exchange to purchase things? And if it's going to be a subject to a capital gain, how do you calculate what the capital gain is" in a blended portfolio with assets purchased at different prices? Sec. Bessent demurred, saying he would have the Treasury Office of Tax Policy work with Lummis on the question.