Senate Version of One Big Beautiful Bill Retains Key Provisions

The U.S. Senate Finance Committee unveiled its portion of the One Big Beautiful Bill Act with some changes to the House-passed version, reports NAHB, but retains several provisions that benefit small businesses and the real estate industry, including:

• Increasing the estate tax exemption to $15 million, making it permanent and indexed for inflation;
• The current mortgage interest deduction rules would be made permanent and mortgage insurance premiums would now be allowed to be deducted;
• The Low-Income Housing Tax Credit would permanently increase 9% credit allocations by 12% and permanently reduce the bond test for 4% credit deals to 25%

However, the Senate version of the bill does not support the State and Local Tax cap increase from $10,000 to $40,000 that was included in the House bill.

VIDEO: What's Behind the One Big Beautiful Bill for Builders?

The House-passed bill would increase the controversial limit on state and local tax (SALT) deductions for individuals from the current $10,000 to $40,000. This increase was part of a last-minute deal with Republicans representing high-cost and high-tax states which paved the way to passage of the bill in the House by a narrow 215 to 214 vote.

Senate Republicans do not support the SALT cap increase included in the House bill, but also recognize that changing the deal risks killing the bill in the House. Any changes to the House-passed bill by the Senate will require approval by the House.