From NAA:
By Owen Caine
On July 1, 2025, meeting its self-imposed deadline, the U.S. Senate narrowly passed its version of the One Big Beautiful Bill Act (OBBBA) - the reconciliation package that dictates the future of federal tax policy – out of chamber. With three Republican Senators voting no - Sens. Susan Collins (R-Maine), Thom Tillis (R-N.C.) and Rand Paul (R-Ky.) - Vice President JD Vance broke the 50-50 tie, allowing the legislation to advance.
The OBBBA has been in a constant state of negotiation in the Senate since its passage in the House several weeks ago. While much of the bill has remained unchanged since the Senate Parliamentarian made her rulings, it's clear that Senators are prioritizing boosting housing supply and affordability through this legislation.
Industry Priorities
Broadly speaking, the National Apartment Association’s (NAA) key tax priorities on behalf of the rental housing industry remain intact.
Other key updates include:
- State and Local Tax (SALT) Deductions: The Senate’s version of the bill would raise the cap to $40,000 for this year for those making up to $500,000. It would rise gradually through 2029, after which the limit would revert back to $10,000.
- Artificial Intelligence (AI) Regulatory Pause: After several attempts to revive this proposal, the Senate voted 99-1 in favor of an amendment to remove any AI regulatory pause.
- Section 899: The “revenge tax” was removed from both versions of OBBBA at the request of Treasury Secretary Scott Bessent.
- Section 199A: The Senate bill would make the Sec. 199A qualified business income (QBI) deduction permanent and keep the deduction rate at 20% (the bill passed by the House would have raised it to 23%).
- Debt Ceiling: The Senate raised the debt ceiling by $1 trillion more than the House, bringing it to $5 trillion.
What’s Next
Due to the number and extent of the changes the Senate made to the OBBBA, the legislation will have to be reconsidered by the U.S. House of Representatives, where the fate of the bill is far from certain.
While the rental housing industry saw relatively few changes in our areas of interest, several sections of the OBBBA were drastically changed, complicating support among different groups of House Republicans. The most severe changes are in the areas of tax on tips, Medicaid funding, national security, child tax credit and, perhaps most importantly, the total cost of the OBBBA.
The House will now begin its debate over the amended Senate language, striving to meet its self-imposed deadline of this Friday, July 4, 2025.