Last week, the Senate finally passed "Reconciliation 2.0" – a $72 billion Department of Homeland Security (DHS) funding package for Immigration and Customs Enforcement (ICE) and Customs and Border Protection (CBP) – after overcoming concerns related to funding for White House ballroom security and the $1.8 "anti-weaponization" fund. The bill now heads to the House, with the hopes of passage this week.

The tortured path to enactment of Reconciliation 2.0 impacts the potential for any tax legislation this year, whether it be as part of another Republican-only Reconciliation 3.0 or perhaps a year-end bipartisan bill. Continued fallout from the Administration's pursuit of controversial priorities, combined with increased difficulties in maintaining unity in the Republican caucus in light of the primary losses of Senators Bill Cassidy (R-LA) and John Cornyn (R-TX), will make moving another reconciliation bill quite challenging. Those same Administration priorities will also make it challenging for the parties to come together on a bipartisan bill – particularly if Republicans first pursue Reconciliation 3.0.

Of course, the political winds are always subject to change, particularly in an election year. Congressional Republicans and the Administration could lock arms and pursue Reconciliation 3.0, particularly if it is viewed as necessary to improve their chances in the mid-term elections. Similarly, the results of the mid-term elections could create a dynamic where the parties come together on a bipartisan package in a post-election "lame duck" session at the end of the year.

In sum, it is interesting to be this far into an election year with multiple viable legislative vehicles for a tax bill. Only time will tell whether the politics shift such that one of them becomes a reality. #TaxTake

Upcoming Speaking Engagements and Events 

Mike and Katherine Jordan will speak at the NYU 18th Annual Tax Controversy Forum on June 25-26.

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Marc, Mike, Rocco, and Layla received individual recognition in the 2026 edition of Chambers USA, and the firm received the only Band 1 ranking in the Government Relations: Specialist Tax Firms category.

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