Here’s a look at recent tax-related happenings on the Hill, including a number of corrections expected for the One Big Beautiful Bill Act (OBBBA).
Lately on the Hill
Technical Corrections Expected for Tax Bill
Congress is on recess until September 2. Members returned to their states and districts to either tout or belittle the legislature’s actions thus far in the year, as early positioning for next year’s elections takes shape.
The central piece of the Congress thus far, the OBBBA, is expected to receive a slew of technical corrections given the quick time frame in which it was drafted and enacted. The number and scope of corrections will be determined once the Joint Committee on Taxation publishes its Blue Book covering the legislation. For reference, it took about a year for the committee to release the Blue Book on the Tax Cuts and Jobs Act of 2017, which totaled 90 pages and included 78 items proposed for technical correction.
“Whatever bill goes out—no matter how long or short it is—there will be something you’ll go, ‘Oh, that was an unintended consequence of it,’ especially in tax law, with the complexity of tax law,” said U.S. Sen. James Lankford (R-OK) of the Senate Finance Committee.1
No Tax on Home Sales Gains Some Traction
U.S. Rep. Marjorie Taylor Greene’s bill, “No Tax on Homes Sales Act,” garnered some attention last week after President Donald Trump commented, “we’re thinking about that,” in reference to the idea of excluding capital gains on the sale of a taxpayer’s principal residence.
Currently, a taxpayer is limited to excluding $250,000 ($500,000 for married filing jointly) of gain on the sale. The proposed legislation would do away with this limitation. The requirement that the property be used as the taxpayer’s principal residence for two of the last five years would remain.
Realtor.com crunched the numbers and found homeowners in California would by far reap the most benefit from the bill, followed by Florida, New York, and Washington, where home values have gained more than the current $500,000 exclusion.2
High Tariffs Take Hold Affecting Switzerland, Canada, & India
Reciprocal tariffs took effect last week on dozens of countries ranging from 10% to 41%. Switzerland’s President Karin Keller-Sutter flew into Washington, D.C. for last-minute negotiations before the country’s 39% rate was to begin last Thursday.
Switzerland holds a $38.5 billion trade surplus with the U.S. and received one of the highest duty rates of any country. Keller-Sutter failed to achieve a deal, allowing for the high tariffs to commence.3
Canadian Prime Minister Mark Carney is looking to tamper escalating tariffs after the U.S. increased duties on its northern neighbor from 25% to 35%, effective August 1, 2025. Included with the increased tariff on Canada is a 40% duty for transshipment, a maneuver whereby countries route goods through other countries to avoid tariffs. Carney reportedly is looking to rescind counter-tariffs his country has imposed on the United States. “We look at what we can do for our industry that is most effective. In some cases, that will be to remove tariffs,” the prime minister said, using the automotive industry as an example where removing tariffs will help it to “function more effectively.”4
Meanwhile, Trump signed an executive order increasing tariffs imposed on India by 25%, doubling already existing tariffs on the country to 50%. According to a fact sheet released by the White House, the additional duties address “India’s direct or indirect importation of Russian Federation oil.” The duties come into effect on August 27, 2025.
Treasury Secretary Scott Bessent said he expected trade deal negotiations to be completed by the end of October with countries that have not yet completed a deal.5
Trump also revealed he is planning a 100% sector tariff on semiconductors and other levies on electronics during a meeting with Apple CEO Tim Cook. Exemptions would be made available to companies, such as Apple, that invest in domestic manufacturing. Cook announced a $100 billion investment into the U.S. by the tech company.6
From the Treasury & IRS
New Acting Commissioner to Lead IRS
Bessent will take over as acting IRS commissioner after Billy Long was removed from the post by Trump. Long will instead serve as ambassador to Iceland. Bessent becomes the seventh person to lead the agency this year.7
The IRS reigned in earlier remarks made by Long as to the delayed start to next year’s tax filing season. “The IRS looks forward to another successful tax filing season next year, and we will announce the timing of its opening in the regular course,” the agency said. Long had estimated a mid-February start date for taxpayers to be able to begin filing tax returns, a time frame later than the usual late January start date.8
Released Guidance
Proposed Regulations (REG-132805-17) provide guidance regarding an employer’s line or lines of business in determining the exclusion from gross income for no-additional-cost services or qualified employee discounts for employees. The proposal would replace the Enterprise Standard Industrial Classification (ESIC) Manual with the North American Industry Classification System (NAICS) for purposes of determining an employer’s line of business.
IR-2025-81 reminds employers that they may contribute up to $5,250 annually toward employee student loans under an educational assistance program. These payments are not taxable to the employee and may be made through December 31, 2025.
IR-2025-82 announces that no changes will be made to certain information returns or tax year 2025 withholding tables related to the implementation of the OBBBA. The IRS specifies that no changes will be made to Forms W-2, 1099, 941, and other payroll forms.
This newsletter features developing content that is subject to change at any time. It does not constitute legal or tax advice. Consult your professional advisors prior to acting on the information set forth herein.
- 1“Get Ready for a Parade of Technical Corrections on Tax Bill,” taxnotes.com, August 6, 2025.
- 2“Axing Capital Gains Tax on Homes Would Benefit California’s Rich,” bloomberglaw.com, August 4, 2025.
- 3“Swiss President Leaves Washington Without Lower Tariff,” bloomberglaw.com, August 6, 2025.
- 4“Carney Says He’ll Look at Opportunities to Remove Tariffs,” bloomberglaw.com, August 5, 2025.
- 5“Bessent Sees US Trade Talks Largely Done by October, Nikkei Says,” bloomberglaw.com, August 10, 2025.
- 6“Trump Eyes 100% Chips Tariff, Exempting Firms That Invest in US,” bloomberglaw.com, August 6, 2025.
- 7“IRS Commissioner Long Exits, With Bessent Now Acting Head,” bloomberglaw.com, August 8, 2025.
- 8“IRS Walks Back Commissioner’s Filing Season Prediction,” taxnotes.com, August 5, 2025.