Last week, the Treasury Department and Congressional Budget Office both moved up their estimated deadline for addressing the debt limit to early June, setting off a new scramble among lawmakers in Congress and the White House to find a solution. The President, who has consistently insisted on a clean increase in the statutory debt limit, extended an olive branch by inviting congressional leaders to meet at the White House tomorrow.

The earlier-than-anticipated debt deadline, combined with the House Republican passage of their Limit, Save, Grow Act of 2023 debt limit proposal and a Senate Budget Committee hearing on the topic, has put the debt limit debate front and center. 

Although the scope and terms of an ultimate debt limit deal are quite uncertain at the moment, tax policy observers are keenly interested in the potential viability of any negotiated package as a vehicle for tax legislation. While the Limit, Save, Grow Act of 2023 contained a tax title dedicated to revenue offsets (i.e., the repeal of clean energy tax incentives enacted as part of the Inflation Reduction Act), supporters of the section 174 R&D amortization fix, the section 163(j) EBITDA calculation fix, bonus depreciation, and other tax relief proposals hope these provisions will come into play once everyone sits down at the negotiation table. Such consideration will likely be tempered, however, by Republican demands (as evidenced by the Limit, Save, Grow Act of 2023) for spending cuts in connection with any debt limit increase.

Even still, the best chances for advancing tax policy, we believe, will come later this year with legislation to address government spending, FAA reauthorization, and a farm bill extension. #TaxTake

Upcoming Speaking Engagements and Events

On May 11, Loren will speak at the Tax Council Policy Institute 2023 Annual Symposium on a panel titled "Building a Better Mousetrap: Future of Cross-Border Dispute Resolution."

Loren will present "Pillar Two and Potential U.S. Response," a panel discussion at the 2023 Texas Federal Tax Institute Annual Conference on June 7. 

On June 20, Loren will present, "U.S. Tax Update - Global Trends with Local Impacts," at the TP Minds International 2023 Conference in London.

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