06/18/2025

Senate Releases its Draft of the 'One Big Beautiful Bill'

A key area of debate is the cap on SALT deductions

On June 16, 2025, Senate leaders released their draft of the "One Big Beautiful Bill," offering a detailed look at possible updates to federal tax policy, social program funding and economic development incentives. While this version is still in draft form and has not been passed, it provides insight into how lawmakers may negotiate differences with the House bill, which was approved in May.

Proposed Tax Policy Changes

The Senate draft aims to make several provisions permanent from the 2017 TCJA tax cuts, including business tax breaks such as 100 percent bonus depreciation. Additionally, the Senate is proposing beneficial changes that make domestic research and development expenses deductible as they were prior to the TCJA, and base the 30 percent business interest expense limitation on EBITDA rather than EBIT.

A key area of debate is the cap on state and local tax (SALT) deductions. The Senate proposal maintains the current $10,000 limit, while the House draft raises it to $40,000. The SALT cap has been a major sticking point for some representatives from states with higher taxes, and this will be a major negotiating point over the coming weeks.

Please select this link to read the complete article from OSAP Mission Partner Clark Schaefer Hackett (CSH).