Foreign affairs will clearly be a bigger part of the congressional focus than would have been anticipated at the end of last week, given the weekend's events, and war powers resolutions may be voted on. The House is scheduled to have a shortened workweek, with votes only on Wednesday and Thursday (March 4-5). Services for the late Rev. Jesse Jackson will be held today, and Tuesday is a primary election day in North Carolina, Texas and Arkansas. The Senate returns to session today (March 2), with a 5:30 p.m. procedural vote related to the Housing for the 21st Century Act (H.R. 6644). Global events could influence efforts toward reaching an agreement to fund the Department of Homeland Security.

Upon returning to session, the House is set to vote on bills on the suspension calendar that are under the jurisdiction of the Natural Resources Committee and Education & Workforce Committee.

On Wednesday, March 4, there are three tax events on Capitol Hill:

• the House Ways and Means Committee has scheduled a 10 a.m. hearing with IRS Chief Executive Officer Frank Bisignano to discuss the 2026 filing season, implementation of the "One Big Beautiful Bill Act" (OBBBA), and the Trump administration's priorities for the IRS
• the Joint Economic Committee has scheduled a hearing at 10:30 a.m. on "Evaluating the U.S. Competitiveness and Investment Advantages of a Destination-Based Cash Flow Tax (DBCFT)"
• the Joint Committee on Taxation is holding a "Panel on The Joint Committee's Role in the Tax Legislative Process in the Past and the Future" from 2:30 to 4:30 p.m.

On Thursday, March 5 at 10 a.m., the Senate HELP Committee will hold a hearing on "Transforming Health Care with Data: Improving Patient Outcomes Through Next-Generation Care."

Elections — One of the main contests in Tuesday's primaries is the Texas Senate match-up that, on the Republican side, has Senator John Cornyn (R-TX) challenged by State Attorney General Ken Paxton (R) and Rep. Wesley Hunt (R-TX). On the Democratic side is Rep. Jasmine Crockett (D-TX) against state Rep. James Talarico (D). A May 26 runoff follows if candidates can't exceed the 50% vote threshold.

CNN reported this morning, "It's expected that the open North Carolina Senate race will come down to Democratic former Gov. Roy Cooper and former Republican National Committee Chair Michael Whatley. Both should win their primaries on Tuesday."

Housing — The Senate this week will move to a bipartisan housing bill (S. 2651, the ROAD to Housing Act) that passed the Banking Committee in July on a unanimous vote. The House passed a similar housing bill in February with 390 votes. Senate leaders have used the House-passed Housing for the 21st Century Act (HR 6644) as a shell for theirs in a bid to avoid a House-Senate conference. With the White House pressing for an "affordability" bill the President can sign, talks around a bipartisan, bicameral compromise accelerated last week after it became clear that the product passed by the Senate would likely be the final bill. Senate sponsors are working to incorporate some of the House-passed provisions into a manager's amendment this week that the House side could accept.

Significantly, the White House wants to add language restricting Wall Street institutional investors from buying single-family homes, similar to the President's January 20 executive order. On February 27, Semafor reported that Republicans are considering using tax policy as a way to impose the ban on such investors. The story quoted Rep. Marlin Stutzman (R-IN) as saying Treasury Secretary Scott Bessent told House Republicans in a meeting last week, "This is not a free market for the American family, because investors … have special tax write-offs … that aren't available to single families." Stutzman said, "The Secretary was very clear he's open to multiple ideas — but the tax incentives seem to be the one that may have a little bit of traction."

The issue of blocking institutional investors from buying houses has been criticized by some Republicans. Sen. John Kennedy (R-LA) told Semafor, "I'm not convinced the way you increase the number of people buying houses is to stop them from buying houses." Sen. Mike Rounds (R-SD) told Punchbowl News that he would generally prefer tax policy changes to encourage family home ownership instead of pursuing top-down institutional investor bans: "I would rather see us go after additional incentives for homeownership, and maybe some tax incentives to decrease investment companies." But Punchbowl on Sunday also threw cold water on the idea of using the tax code to achieve housing policy goals in this bill, saying the effort "is not serious at the moment. Turning the housing package into a tax bill would only make it much harder — if not impossible — to pass."

More broadly, the House and Senate bills share a focus on streamlining regulations, modernizing federal housing programs and providing new tools and incentives for communities to build. House Republicans included a package of changes to community banking regulations, but those changes have drawn objections from Banking Committee Ranking Member Elizabeth Warren (D-MA). For their part, House Republicans have criticized a number of provisions that Warren included in the Senate bill, such as new regulations and spending on housing-related Community Development Block Grants (CDBGs).

Morning Tax reported on a new letter from conservative tax activists to congressional Republican leaders today urging passage of the "More Homes on the Market Act" (H.R. 1340, S. 3332) to update the principal residence capital gains exclusion by catching it up to inflation and indexing it going forward.