# Congress Eyes Tax Changes Before Year-End. Here's What Savers and Filers Need to Track
Tax uncertainty hangs over the remainder of 2024 and into 2025 as multiple proposals circulate through Congress. Taxpayers and preparers should monitor several pending changes that could affect withholding, deductions, credits, and retirement accounts before year-end deadlines lock in new rules.
The most pressing issue involves the expiration of provisions from the Tax Cuts and Jobs Act of 2017. Many individual tax cuts, including lower ordinary income tax rates and expanded child tax credits, currently expire December 31, 2025. Congress must decide whether to extend these provisions, modify them, or let them expire entirely. If lawmakers do nothing, tax bills will rise substantially for millions of households starting January 1, 2026.
Several other proposals remain under active discussion. One ongoing debate centers on the treatment of unrealized capital gains for high-net-worth individuals. The Biden administration proposed a 20 percent minimum tax on households worth over $100 million, though the proposal faces significant Republican opposition and remains unlikely in its current form. Changes to retirement account contribution limits, catch-up contributions for older workers, and backdoor Roth conversion rules also appear in various legislative proposals.
State and local tax (SALT) deduction limits represent another flashpoint. The current cap of $10,000 per year expires in 2025, and high-tax states continue pushing for permanent relief. Some proposals would increase the cap significantly or eliminate it entirely for certain taxpayers, while others suggest keeping the current limit.
Business owners should watch proposals affecting pass-through entity taxation and the qualified business income deduction. These provisions also sunset in 2025 and will require congressional action to continue.
The timing complicates planning. Election cycles historically delay major tax legislation. Regardless of which party controls Congress after November 2024, lawmakers typically defer major tax overhauls until late 2024 or early 2025, creating uncertainty for both individuals and businesses trying to make year-end financial decisions.
Taxpayers face a practical dilemma. Making large charitable contributions, accelerating business income, deferring personal deductions, or adjusting retirement account contributions all depend partly on what Congress actually does. Professional tax preparers recommend documenting current financial situations and maintaining flexibility rather than making irreversible moves based on uncertain legislation.
The IRS continues administering current rules unchanged. Withholding tables, contribution limits for IRAs and 401(k)s, and tax filing deadlines remain as currently scheduled. The agency has made no announcements about interim changes pending congressional action.
Several factors suggest tax legislation may move slowly. Budget reconciliation procedures offer one path for tax changes without filibuster protection in the Senate, but the process requires agreement on overall spending and revenue targets. Divided government makes compromise difficult, particularly on contentious issues like high-earner taxation and SALT deduction limits.
Advisors recommend quarterly reviews of tax situations through year-end. Clients should examine estimated tax payment schedules, charitable giving plans, and retirement contributions. Anyone expecting major life changes (marriage, home purchase, business sale) should discuss timing implications with their tax professional before year-end.
The bottom line remains straightforward: expect congressional action on taxes before 2026, but do not delay planning assuming any particular outcome. Work with your tax advisor to understand your specific exposure to proposed changes and build flexibility into year-end strategies.