TCJA Permanency Act

Most individual-side tax rules in the 2017 Tax Cuts and Jobs Act (TCJA) were written to expire after December 31, 2025 — meaning absent congressional action, roughly 200 million filers would face reverted rules on 2026 tax returns. HR-137 would strike those sunset clauses and make 22 TCJA provisions permanent, including the lower 37% top marginal rate, the nearly doubled standard deduction (~$15,000 single / $30,000 married), the $2,000-per-child tax credit, the $750,000 cap on mortgage interest, the raised Alternative Minimum Tax exemption, and the doubled estate-and-gift tax exemption (about $13.6 million per person in 2024). It would also permanently lock in the 20% pass-through business income deduction (Section 199A) — a provision used heavily by real estate operators, professional partnerships, medical practices, and hedge funds. Smaller provisions made permanent include the tax exclusion for student loans discharged due to death or permanent disability, combat-zone tax treatment for troops deployed to the Sinai Peninsula, and expanded ABLE-account rules for people with disabilities. The bill keeps in place the $10,000 cap on state-and-local-tax (SALT) deductions — which disproportionately raises federal taxes for filers in high-tax states — and the permanent repeal of the personal exemption. The nonpartisan Joint Committee on Taxation has estimated that making TCJA's expiring individual-side provisions permanent would reduce federal revenue by roughly $4 to $4.5 trillion over ten years, with the largest after-tax income gains concentrated among high-income households, pass-through business owners, and heirs of multi-million-dollar estates.

• Makes permanent several TCJA provisions whose benefits concentrate at the top: the 20% Section 199A pass-through deduction (used heavily by real estate operators, professional partnerships, medical practices, and hedge funds), the 37% top individual rate (compared to 39.6% under pre-TCJA law), and the doubled estate-and-gift tax exemption of about $13.6 million per person, which shields only the wealthiest estates from federal estate tax. The Joint Committee on Taxation has estimated a roughly $4–4.5 trillion ten-year revenue cost, with independent analyses finding the largest after-tax income gains flow to households in the top 5% of earners. Some provisions in the bill — including the permanent $10,000 SALT cap and the continued repeal of the personal exemption — can offset these benefits and even raise taxes for some middle- and upper-middle-class filers in high-tax states.