“Big Beautiful Bill” Advances on Capitol Hill
In May, the House passed a budget resolution that clears the path for a sweeping tax package dubbed the “Big Beautiful Bill.” This legislation includes full R&D expensing, a potential repeal of the Section 174 amortization rule, and extensions of key Tax Cuts and Jobs Act (TCJA) provisions. It also proposes new industry-specific tax credits.
Why It Matters:
This bill proposes substantial changes, including tax exemptions for tip income and overtime pay, increased child tax credits, and incentives for domestic manufacturing. These alterations could significantly impact individual and business tax liabilities.
Actionable Steps:
- Update tax planning strategies.
- Analyze client portfolios.
- Monitor legislative developments.
Tax Policy in Flux: Advisors Urged to Plan for Multiple Outcomes
Tax professionals are keeping a close eye on shifting federal policy debates, particularly surrounding proposals affecting Social Security taxation, overtime and tip income exemptions, and SALT cap modifications. With many Tax Cuts and Jobs Act (TCJA) provisions set to expire at the end of 2025, the current uncertainty is prompting firms to map out flexible planning strategies.
Why It Matters:
Congress is considering significant tax legislation that could affect the 2026 filing season, which could have substantial implications for tax planning and compliance.
Actionable Steps:
- Monitor state-specific deadlines and changes.
- Stay updated on legislative developments.
- Rebalance staff workloads strategically.
AI & Automation’s Growing Role in Tax Practice
As firms seek to improve efficiency before the next tax season, more professionals are adopting AI tools for document review, client communication, and compliance workflows. May’s publications are full of practical use cases and ethical guidelines for tax professionals navigating automation. It’s not just hype; firms that don’t explore these tools risk falling behind.
Why It Matters:
The rapid pace of AI development requires accountants and tax professionals to continually update their knowledge and skills. Staying informed about technological advancements is crucial to remain relevant and effective.
Actionable Steps:
- Stay informed on AI trends.
- Integrate AI into practice.
- Focus on developing soft skills.
CPA Licensure Modernization Gains Traction
The American Institute of Certified Public Accountants (AICPA) and the National Association of State Boards of Accountancy (NASBA) have approved a modernized, optional pathway to CPA licensure that could ease entry into the profession. This update also introduces practice mobility, allowing CPAs to work across state lines with a single license. Fourteen states have already passed legislation adopting the new framework, with broader implementation expected in the updated Uniform Accountancy Act this summer.
Why It Matters:
This model addresses the CPA talent shortage by offering an alternative route that emphasizes real-world experience over additional coursework. This is a proactive step toward replenishing the CPA workforce without compromising standards.
Actionable Steps:
- Stay informed on state-level adoption.
- Adapt recruitment and training strategies.
- Review and update compliance policies.