On April 27, 2026, the House Committee on Rules will meet on "Reconciliation 2.0" and send a second budget resolution to the floor for votes this week. This budget resolution focuses exclusively on funding immigration and border enforcement at the Department of Homeland Security (DHS) and does not include a tax title, but immediate success on the resolution hinges not just on promises of a third act for reconciliation but also the prospects for success on that third act. 

More than a few Republicans in Congress are skeptical that a third shot at reconciliation will materialize. "This will probably be the last reconciliation we do before the end of the year," Representative Ralph Norman (R-SC) previously predicted.

This skepticism is driving two responses from the House GOP caucus: (i) demands from some rank-and-file House Republicans that the second reconciliation bill be expanded to include more GOP priorities on military spending, voter ID, tax relief, and other policy reforms; and (ii) countervailing promises from GOP leadership that a third reconciliation bill won't be just a mirage.

To some extent, House Committee on the Budget Chairman Jodey Arrington (R-TX) agrees with both positions. He noted that without an ironclad guarantee to advance a third reconciliation bill, this week's vote on the second could be in jeopardy. "The question will be for our conference… [do] they believe that we can do another reconciliation for fraud and defense and maybe some affordability issues," he told reporters. "If they believe we can do a third one, then people will support this quick and skinny reconciliation."

House Speaker Mike Johnson (R-LA) said last week that the House will deliver a third bill. "We're going to move to reconciliation, what will now be 3.0," he vowed. "We're going to do it as quickly as possible." Realistically, work on a third bill probably would not commence until June at the earliest.

Don't forget that Speaker Johnson commands a narrow, single-digit majority where one or two lawmakers can defeat or delay almost any bill sent to the floor. Drafting a broader reconciliation bill that cuts taxes, adds defense spending, and includes significant revenue offsets is no easy task, especially in an election year where Republicans are working against the tides of history to preserve their majority in the midterms.

A post-election lame-duck session may provide a more tranquil atmosphere for action on tax policy that could potentially include tax extenders, taxation of digital assets, Internal Revenue Service (IRS) administrative reforms, reducing double taxation on cross-border investments between the U.S. and Taiwan, retirement savings improvements, and more. This would require bipartisan cooperation that many Democrats insist will not happen without action to reinstate more generous subsidies provided by the Premium Tax Credit (PTC) for purchasing coverage on the Affordable Care Act (ACA) exchanges. Senate Committee on Finance Ranking Member Ron Wyden (D-OR) has warned that he's not willing to work on business-friendly tax provisions without some action to address the PTC. #TaxTake

Upcoming Speaking Engagements 

Marc will speak at the American Staffing Association (ASA) Staffing Law and Compliance conference on May 8.

Mike, Jim Gadwood, Sam Lapin, Katherine Chace, and Tyler Jackson will speak at the American Bar Association's (ABA) 2026 May Tax Meeting on May 7-9.

Rocco will speak at the Tax Council Policy Institute (TCPI) symposium Tax Matters: Federal, State, and Global Taxes in Turbulent Times on May 14.

Marc, Sam Lapin, and Lisandra Ortiz will speak at the Federal Bar Association (FBA) Insurance Tax Seminar on May 28-29

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