Let Me Predict the Future: Taxes Will Increase—Unless Congress Acts

With more than $4 trillion of tax increases scheduled to take effect at the end of 2025, given the sunsetting provisions of the Tax Cuts and Jobs Act (TCJA), 2025 will be the most consequential year for tax legislation since the 2017 enactment of the TCJA. Whatever the results of the Presidential election, it’s expected that Congress and the new administration will confront these looming tax increases—or will they just let them happen? Will the cost of extending the 2017 tax cuts propel Congress to seek new tax increases as offsets?

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Related Content

• Tax Cuts and Jobs Act of 2017: C Corporations and International Planning
  Remember the breadth of the TCJA.  Under the TCJA, U.S. corporations received a 100% dividends-received deduction for the foreign portion of any dividend received by that corporation. That meant that corporations with foreign interests could have their foreign subsidiaries issue dividends to the U.S. parent of income earned abroad and have that income subject only to any foreign tax that applied. That new rule was opposite from the pre-TCJA rule where foreign sourced dividends were then subject to full tax, less applicable foreign tax credit.

• 2018 Emerging Issues 8646, Insights/Planning Tips from Corporate/Business Portions of Tax Cuts and Jobs Act
  Note one of the most important provisions of the TCJA, cutting the maximum corporate tax rate imposed on domestic C corporations, from 35% to 21%. The TCJA repealed the AMT for corporate taxpayers too and substituted for it a Base Erosion and Anti-Abuse Tax (BEAT).

• Tax Cuts and Jobs Act of 2017 Resource Kit
  Reference this resource kit which provides information pertaining to the TCJA. The law was passed by Congress on December 20, 2017, and signed by President Donald J. Trump on December 22, 2017. The legislation included sweeping individual, corporate, and international tax reforms.

Practical Guidance Updates 
Featuring the latest updates from your Practical Guidance account.   

• Tax Key Legal Developments Tracker (Federal)—keep up to date with key legal developents!
  • Business Entities. The IRS and the Treasury Department issue corrections to the final regulations (Treasury Decision 9993). See 89 Fed. Reg. 34770 (April 30, 2024). Treasury Decision 9993 contains final regulations concerning the election under the Inflation Reduction Act of 2022 to transfer certain tax credits. 89 Fed. Reg. 67859 (Aug. 22, 2024).
  • Business Entities. IRS releases guidance which describes the information that must be included in a written report under  Reg. § 1.45Q-4(c)(2)(LCA Report) and provides the procedures a taxpayer must follow to submit the LCA Report and required supporting information to the IRS and the Department of Energy (DOE) for review under Treas. Reg. § 1.45Q-4(c)(5) before any credit for carbon oxide sequestration is allowed under I.R.C. § 45Q(a)(2)(B)(ii) or (a)(4)(B)(ii).  I.R.S. Notice 2024-60.
  • Employment/Payroll. IRS reminds businesses that starting in year 2023 changes under the SECURE 2.0 Act may affect the amounts they need to report on their Forms W-2 to reflect SECURE 2.0 Act changes, including features like (1) de minimis financial incentives (Section 113 of the SECURE 2.0 Act), (2) Roth Savings Incentive Match Plan for Employees (SIMPLE) and Roth Simplified Employee Pensions (SEP), Individual Retirement Arrangements (IRAs) (Section 601 of the SECURE 2.0 Act), and (3) optional treatment of employer nonelective or matching contributions as Roth contributions (Section 604 of the SECURE 2.0 Act). FS-2024-29, Aug. 2024. IRS News.
• Inflation Reduction Act: Tax Provisions Tracker—keep up to date with key legal developments regarding the Inflation Reduction Act of 2022.
• Document alertsallow you to stay current on legal developments that affect your practice. Find out how to set up your document alerts. 
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• Review this exciting guide featuring some of the recent content additions to Practical Guidance, designed to help you find the tools and insights you need to work more efficiently and effectively.
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• Legal Developments provide the latest updates and analyses of emerging topics impacting your practice area. Visit the Legal Developments page to see the latest topics, which also include breaking legal news and related Practical Guidance content. 
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