As of 1 September 2026, Grant Thornton’s Washington National Tax Office has released an updated analysis of the year-end tax legislative landscape in the United States Congress. With the 2026 election cycle creating a compressed legislative calendar, several significant tax proposals remain active that could impact corporate and individual taxpayers if enacted before the end of the year. The report references ongoing negotiations around the Tax Relief for American Families and Workers Act (H.R. 7024), potential extensions of expired Tax Cuts and Jobs Act provisions, and emerging bipartisan discussions on research and development expensing, bonus depreciation, and child tax credit enhancements. The analysis outlines the procedural pathways—including reconciliation, omnibus appropriations, and standalone bills—through which these measures could advance during the lame-duck session. Taxpayers should monitor developments closely, as retroactive application of certain provisions could require amended returns or adjustments to estimated tax payments for 2026.
Key Takeaways
- R&D Expensing and Bonus Depreciation Revival: Legislative momentum is building to restore immediate expensing for domestic research and experimental expenditures under Section 174 and to reinstate 100% bonus depreciation for qualified property placed in service after 2025. These changes would provide significant cash-flow benefits for capital-intensive industries and may apply retroactively to the beginning of 2026.
- Child Tax Credit Expansion: Bipartisan negotiations continue around increasing the refundable portion of the child tax credit and adjusting income thresholds, which could affect millions of taxpayers and require payroll system updates for employers. The proposed changes aim to reduce child poverty and may be included in a year-end package.
- International Provisions and Pillar Two Interaction: Proposals to modify the global intangible low-taxed income (GILTI) regime and foreign-derived intangible income (FDII) deductions are being evaluated in light of OECD Pillar Two implementation, creating complexity for multinational enterprises’ effective tax rate planning. Companies should model the interaction between potential US legislative changes and the global minimum tax.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
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