The Tax Cuts and Jobs Act (TCJA), also known as the Trump tax cuts, was passed in 2017, but many provisions—particularly those affecting households and small businesses—are set to expire this year!

If Congress does not extend them or make them permanent, you’ll get a tax hike, you’ll get a tax hike, and you’ll get a tax hike!

Making his signature tax cuts permanent for women, workers, and small businesses is a top concern for President Trump in his second administration. The president has called for a “big beautiful bill” that includes the tax cuts along with money for border security and permitting reform that allows the U.S. to increase energy production.

Now, it’s up to Congress to deliver the permanence of these tax cuts. This is where rhetoric meets reality.

Process

The House and Senate are on a two-track path to extend the tax cuts, but right now, those tracks are not syncing up.

Extending the tax cuts would occur through a process called the “budget reconciliation process.” Reconciliation is a fast-track path to passing a budget bill by a simple Senate majority (rather than a 60-vote threshold).

Each House passes a budget resolution bill with spending instructions for tax writing committees to determine spending and revenue targets—just topline numbers, not specifics. Committees are then charged with crafting legislative language laying out the spending priorities and revenue sources. These policy provisions are compiled into a larger legislative package known as the reconciliation bill. The final reconciliation bill must pass the Senate by a simple majority.

The 2017 tax cuts were passed through the reconciliation process, as was the Affordable Care Act (aka Obamacare).

Status of the Tax Cuts

As of early March, the Senate and House have both passed budget resolutions, but they are not identical.

House of Representatives: On Feb. 25, 2025, the House approved a fiscal year 2025 budget resolution by a vote of 217 to 215. The topline numbers:

  • Net tax cuts of $4.5 trillion over 10 years.
  • Federal spending cuts of at least $1.7 trillion (contingent on achieving $2 trillion in spending cuts, but if fewer spending cuts are made, the tax cuts would be reduced by the amount of the shortfall).
  • $4 trillion increase in the federal debt limit, raising it to $40.1 trillion.

Senate: On Feb. 21, 2025, the Senate approved a fiscal 2025 budget resolution by a vote of 52 to 48. The topline numbers: 

  • Border and defense spending, domestic energy production, and unspecified spending cuts
  • Does not authorize any tax cuts.

The work of the tax writing committees now begins. 

A final bill is expected to be voted on, delivered, and signed into law by President Trump in late spring or early summer.

What Does This Mean for Me?

The road ahead to extend the tax cuts is long and uncertain. With conservatives in control of Congress and the White House, they are committed to working to ensure that taxes don’t rise, but there may be back-and-forth over specific provisions. Some conservatives may use the tight margins in the House to hold up passage over their favored provisions. This process may get messy before it’s done.

If the 2017 tax cuts are not extended, most Americans will get a tax increase beginning January 1, 2026:

  • The average taxpayer will see a 22% tax hike. 
  • Taxes will rise $1,695 for a family making $80,610 (the median income).
  • The Child Tax Credit will be slashed in half to $1,000 per child for 40 million families.
  • The guaranteed personal deduction will be cut in half for over 90% of taxpayers, including millions of women.
  • 2 million family-owned small businesses, farms, and ranches will be hit by the death tax.
  • The top tax rate will rise to 43.4% for 26 million small businesses.

Women are struggling to keep their small businesses afloat while families are being crushed by the inflation of the past four years. We cannot afford a massive tax hike on top of this.

Independent Women will fight to see the 2017 tax cuts made permanent. Stay tuned for more.