There may be errors in spelling, grammar, and accuracy in this machine-generated transcript.

Roger Harris: Hello again everyone. Another federal tax update podcast. Roger Harris, Andy Schwab, back with you. Andy, how are things going?

Annie Schwab: It's going. We're in the heat of the summer. And I'm not going to lie, I'm getting ready for summer. Uh, summer over and school supply, purchasing and everything else. Um, it's busy, but it's good. How about [00:00:30] you?

Roger Harris: Yeah, just it's just hot. And I was. My next door neighbor is a school teacher, and I was talking to him yesterday, and he said they go back to school before the kids do in, like, two weeks. And I'm thinking, good Lord, where did the summer go? Of course, I guess kids go back to school sooner. So I don't know, it just seems. And DC.

Thad Inge: My kids didn't get out of school till like June 20th. So I don't like all this talk about summer ending.

Roger Harris: Yeah yeah yeah yeah. The voice you heard is our guest today. You know, uh, we are. We promised you guys on [00:01:00] our last one that we were going to dig deep into the, you know, big, beautiful Bill. And what better way to do that than bring back someone you've heard before, Thad Inge, who is a vice president at Van Scoyoc Associations in Washington, DC. And as I jokingly said before we started recording this, the number one expert on all things tax in Washington, DC. Uh, and so that's good to have you back again.

Thad Inge: Great to be here. Thank you.

Roger Harris: Yeah. It's nice to be inside. I know it's as hot in Washington as it is in Texas [00:01:30] and Georgia. So it's I think it's hot everywhere.

Thad Inge: I took the metro this morning and just walking into the office, I was like, pouring in sweat. So it's very nice to be in the air conditioning.

Roger Harris: Yes, yes. And it's hot in here now, but. Oh well, what the hell, it's summer. Um, yeah. We're going to talk big, beautiful bill. We're going to kind of look back. We're going to kind of walk through how we got here, you know, in terms of what the political process was. And then, uh, we'll obviously dig into the bill and we'll dig deeper into some things that are, um, uh, [00:02:00] probably more applicable to some of our clients. A lot of it's not new, but some of it is. So, um, I guess, Annie, let's get started. Where do you want to start?

Annie Schwab: Uh, well, let's start kind of how this process works for those. I know you and I have talked about it some, but I'd love to get dad's feedback on, you know what? How does it work? The whole process of passing a package, we know it started in the house and went back and forth. Um, can you shed some light on on on that process? [00:02:30]

Thad Inge: Yeah. And it's amazing. We are now sitting here in this bill has been signed into law. Yeah, I know that, um, we made predictions all along that this would be longer, harder. No way they would get it done as quickly as they said they, you know, would. And I think we under or at least I underestimated sort of the the political power of President Trump and his ability to bring his party along. I mean, it's very narrow margins in both the House [00:03:00] and Senate. They could only lose three votes. Um, up until hours before this passed on the House floor, you had, um, you know, a couple dozen congressmen saying they were going to vote against this bill. Uh, but the, um, the sort of the political strength of, of President Trump to push his agenda, uh, turned out to be pretty strong. And they got their bill before the July 4th, um, uh, holiday, [00:03:30] which was and he signed it on July 4th, which was the which was one of the big goals. Uh, so that's pretty remarkable.

Roger Harris: Yeah. I mean, that was kind of just I mean, he just kind of made that up on the fly. And yet it became a a marker to try to get it done by July 4th. And like you, it's just like I think you and I talked like a week before it and like, well, this will never happen. And the next thing you know, we got a signing ceremony.

Thad Inge: Exactly.

Annie Schwab: Um, well, there are just so many different things that the Senate wanted versus the House, and I didn't think that they'd come to [00:04:00] an agreement. They just seemed too far apart. In several of the provisions. Um, so yeah, I didn't think it was going to happen either. I'm sure they spent the night there several nights, but I didn't think it was going to happen.

Thad Inge: Yeah. And the thinking even up to a few weeks, or even in some cases a week before it passed, the conventional wisdom had been, all right, the House is going to pass their bill, the Senate's going to make a number of changes, which they always do, and then they would do some kind of informal conference where they would try to bridge the two bills, [00:04:30] come up with a middle ground and then, uh, pass that through through both houses, you know, as they made progress, they barely got it out of the house. They passed it by one vote. Right. Um, they barely got the Senate version out. Uh, J.D. Vance, the vice president, had to break the, uh, the tie 5050. And, uh, you know, about a week before the word kind of got around that, uh, there's not going to be any compromise if the Senate gets this out. The House has got to pass it. [00:05:00] No changes, you know. And House leadership was on board with that. Now there were rank and file members were like, that's crazy. You know, they've made all these changes we don't like. We have to fix that.

Thad Inge: But with the political pressure from, uh, from the president and from leadership and kind of the momentum, it was this is it. There are no more changes. You know, uh, we gotta just, you know, the Senate essentially jammed the House is how they kind of refer to it. And, um, in Washington and, [00:05:30] uh, put the pressure on them to, uh, to get it passed. But, you know, you asked about the process. It was a long process getting up to that point. It all happened pretty quick here at the end. But, you know, before about a year before the elections, um, House Republicans started planning for this, saying this is what we're going to do if we get both houses of Congress and the white House. At that point, it seemed unlikely that they would, you know, control all the levers and, um, uh, all the branches in Washington. [00:06:00] But, um, it turned out they did, and they had done a lot of planning, especially on the House side. And so it was a long time in the making. But then it happened pretty quick there at the end.

Roger Harris: Yeah. Once Bill got kind of got got we got in the motion of getting the bill. Like I said it it it moved at a normal pace. And then all of a sudden at the end it was like steroids. It just.

Thad Inge: Yeah.

Annie Schwab: Yeah. Well we came out with some, some new things and then some were like Roger said, we've got [00:06:30] some provisions that we're just going to expire that now that have been extended, we've got some that were temporary, that are now permanent, and then we've got some, some new things too. So it's. What is it like 900 pages.

Thad Inge: Yeah I think, I think it's just I think it's just under a thousand pages.

Annie Schwab: Um, have you read it? I'm kidding. I.

Thad Inge: I have looked at a lot of provisions, you know, and it's, uh, it's dense, like all legislation is. And sometimes you have to, you know, look at a provision for a while to see how how it changed between [00:07:00] the House and the Senate, because those can be pretty subtle tweaks that have sort of, you know, major, um, major impacts. But yeah, there's a ton of policy in there. Um, I'm still seeing new stuff that I sort of didn't realize that was in there or forgot that was in there. But there's the you know, there's kind of the big stuff that we've been talking about all along, right? And the reason we're here is because the Tax Cut and Jobs Act provisions, especially the individual and the family [00:07:30] provisions and a few business provisions from 2017, were set to expire at the end of this year. As everyone knows, I think listening. And so that was what was driving this is we can't let everyone's taxes go up January 1st. We've got to pass this extension. But on top of that, you had a bunch of other issues. Um, obviously President Trump had his campaign agenda with some new tax breaks. Similarly, I think there was a lot of skepticism that those could actually become law. Um, [00:08:00] when he was making those promises. But, um, but they made it a priority. And they did get some form of those, you know, in, in the final package. And then just a lot of other stuff, some of the, you know, expiring business provisions, which I know we'll talk about and some changes that with those there were changes that happened in Tcja that they wanted to reverse because, uh, some of those payfors are not as fun once they actually start being implemented.

Roger Harris: Right? Yeah, yeah.

Annie Schwab: Gotcha.

Roger Harris: And and again, this, [00:08:30] this almost 1000 page bill had a lot other than tax in it. We're focusing obviously on the tax portion. In fact a lot of the things you heard in the other media leading up to the vote. Warren is much about the tax stuff as some of the other stuff. Um, I mean, other than the, you know, tax benefits, the rich or whatever you want to hear. But Medicare got a lot of attention. You know, a lot of things that obviously aren't in here. I've got a philosophical question for you that when [00:09:00] bills like this get done, how much of it's driven by good tax policy versus good politics? Because if you were just sitting down, drawing a bill up and and all you had to consider was good tax policy and you didn't have to consider the politics. I mean, what seems to drive it because it seems like, at least in from the news, it's all politics. You know, we'll make this change because it'll get us a vote as opposed to thinking through it and saying, well, is this good policy?

Thad Inge: Yeah. [00:09:30] So I think you could probably say it's largely the politics of it, but they're not always, you know, totally separate, right? I think first and foremost, as we said, nobody wanted taxes to go up or most people, I mean, there was bipartisan agreement that middle class taxes, you know, lower income taxes, those should not go up. There's always disagreement at the higher end should, you know, should we tax more for the wealthy? Right. That kind of thing. [00:10:00] And there are sort of provisions in the weeds, the stuff that maybe you don't hear about all the time where they make tweaks, they make changes that are good policy, um, things that, um, that folks feel like need to be fixed or, or changed. But um, but yeah, a lot of it is a lot of it is sort of high level, you know, are we going to increase taxes? Who's going to pay, you know, pay the price here or, or share in the [00:10:30] burden. And um, and you had in this case individuals and families were kind of front and center because a lot of the business stuff was made permanent. Right. And in the last bill, which was a little controversial, and that happened. Right. Um, and so, uh, folks did not want to see those taxes go up.

Roger Harris: Yeah, I think a lot of the things that are good policy don't get as much attention as what makes for the political battles and the horse trading for votes and things like that. [00:11:00]

Thad Inge: And sometimes it's about where what chair you sit in, right. You look at the whole salt debate. Right. Um, if you're from a, you know, Midwestern or rural state and have very low state and local taxes and tend to have constituents on the lower income, uh, you know, threshold, then then folks are not going to be crazy about, you know, these, uh, state and local tax deductions. But if you're from Westchester County in New York, [00:11:30] it's just killing, you know, you're you're sort of high income, uh, base. And that ended up as, as we all saw, being one of the sticking points, one that they, you know, it was one of the few that they actually really did have to negotiate between the House and the Senate, uh, to try to come up with something because there was a fear that if they ignored the House members on that issue completely, that that bill probably would have not gotten passed. But the only three, you know, three vote margin. Right. But [00:12:00] they were able to get it close enough. And, um, you know, nobody got everything that they wanted that that was also set to expire. That cap was set to expire at the end of this year as well. So they had some leverage. These these members from New York and Connecticut and New Jersey had some leverage, because if you did nothing, the cap would go away.

Annie Schwab: Right?

Thad Inge: Right now a lot of other stuff would happen too. But yeah, but um, but yeah, they, uh, they ended up getting raising [00:12:30] it from 10,000 to $40,000, but it's temporary. It's only through 2029 and then it reverts back to $10,000. So that was one that was hard to swallow for, uh, for the Salt Caucus. And then it also has the income that, um, you know, it.

Roger Harris: Starts to.

Thad Inge: Phase out at half income. Yep.

Roger Harris: Yeah. Let's. Annie, why don't you walk through some of the tax provisions with that? And we're going to come back to some of them and spend a little extra time, but, um, just kind of walk through [00:13:00] the stuff that was in the bill and kind of what happened to it. Was it just extended? Was it made permanent? Is there anything new? And then we'll circle back to a couple of them.

Annie Schwab: Yeah, sure. So I mean, some of the stuff, some of it was made permanent, for example, the tax rates we talked about. No, but nobody was really in favor of, of increasing taxes. Um, we still have our standard deduction, remember. And some years ago we had the personal exemption and the standard deduction. Well, they permanently extended what we called the enhanced [00:13:30] standard deduction. Um, so you know, and it's, and it's um set for inflation purposes. So it'll adjust. Um, but we've got the standard deduction now permanent. There were some um family medical Coal leave type type provisions that were also paid leave that was also made permanent. Um, the mortgage deduction, which I thought was actually going to be more controversial about just the limit of the amount, the threshold, but it was made. It was made permanent just through, [00:14:00] um, just as it was written in Tcja. So we had that one, um, child tax credit was it was increased, but not by too much. I'm trying to remember I think it's now 2200 per child. Um, so that that remained um, estate and gift also was permanently extended, um, and increased to 15 million for individual filers and 30 for married filing joint. Um, that's not something we've focused a lot on or I actually didn't focus too [00:14:30] much there. Um, but it seemed to to pass fairly easily. So, uh, one that we do hear about, especially in our small business community, is the 199, the 199 a business deduction for pass through entities. Um, so the bill kept it at the 20% calculation. Uh, it increased some of the phase outs and kind of made it a little bit easier for people to qualify. Um, but that definitely I would think that one got a lot of attention during [00:15:00] the debate.

Thad Inge: The House had actually raised that in their bill to 23%.

Annie Schwab: Oh, okay.

Thad Inge: So which was interesting because when you would talk to House members, they would say, that's one we all agree on. That's one we all agree on. Well, they agreed so much they were like, why don't we bump it up to 23%? And then the Senate brought it back down to 20%. But like you said, it did increase that phase, that phase out number.

Roger Harris: Yeah. Yeah I was surprised about the I mean, I maybe I just didn't pay attention to it, like Zandi said. But that's a pretty substantial increase in the exemption [00:15:30] from estate and gift taxes from 5 to 15.

Thad Inge: Well, well, the fact that it's permanent, you know, because I think this year it was getting close to that and then it was going to revert back, you know, next year. But as long as I and I haven't been doing this as long as you guys have. But it's been a roller coaster, right? It's like it's really high and then it'll eventually go back down and then it'll get renewed. But the fact that they made this permanent, I think was a big deal.

Roger Harris: And remember, we [00:16:00] had that one year that it was we had no estate and gift tax. That was right. That was the year they were telling everybody kill your grandparents or something this year.

Annie Schwab: That was a year to die.

Thad Inge: Yeah.

Roger Harris: You know so we had one year of no estate and gift taxes. Yeah. But I, I guess it didn't. Maybe it just didn't get enough press attention because I was yeah, I wasn't surprised it was permanent. I wasn't surprised it went up. But that seemed like a pretty big increase. The other thing I find interesting is while the the legislature, as you mentioned, the legislators that you mentioned in the northeast [00:16:30] fighting so much for the salt increase, there's no way you can, oh, have a salt problem if you can only write off $750,000 dollar houses. So, you know, they didn't seem too concerned about the value of the properties and the mortgage interest deduction on those same houses that are killing them with state and local taxes. Um, but I'm sure maybe that's and maybe this is something that you need to comment on. Well, there was also this whole idea of what this bill cost and trade offs. [00:17:00] If we do this, we can't do that. I mean, how much of this is driven by I know they talk about budget reduction and debt limits and things like that, but there's payfors. I mean, you have to pay for things. And, you know, I guess you're making trade offs. I'm sure the mortgage interest deduction never got a serious discussion because it was expensive.

Thad Inge: Yeah. I mean, some of these, they had, uh, if, if there was not someone fighting really hard on it. Well, people probably don't love that cap at 750, especially [00:17:30] in the high income, you know, states where there's expensive housing. They couldn't get they couldn't cut all these taxes and get rid of every pay for, you know. And that was a lot of the concern around salt was this is a major pay for we can't just get rid of all this stuff. I mean, I know we didn't talk in a little while about the business deductions, but when they scaled those back, those were pay for us for the 2017. And then and then when they got implemented, everyone said, we don't love that. The other thing on salt, and I [00:18:00] mean, you guys know this world better than me, but the alternative minimum tax went away. You know, both in 2017 and now it's gone away permanently. Well, salt was a different deal with the with the AMT because because yeah maybe you could write off all this stuff before. But you were going to get hit by the AMT.

Annie Schwab: Pulled you right back in. Yeah.

Thad Inge: You guys never mentioned that. You know they didn't mention like oh we're also getting the AMT, you [00:18:30] know, uh, permanently uh, removed. Um, but in terms of, of cost, I mean, there's kind of, you know, two frames of thought. One is among Republicans, one is we've got a drastically, you know, cut our spending, especially mandatory spending, things like Medicaid, Medicare, Social Security, although those are politically fraught. Um, because we're not on a sustainable path and we can't just keep growing the deficit. And then others [00:19:00] say this, this spending problem so bad, you know, we can't just make these cuts and get out of that, or the debt problem so bad that we really have to grow ourselves out of, you know, when you talk about when economists talk about this, that's the the easiest way to grow out of it. And I think that's what Trump tried to message to the Hill is, hey, I know this seems expensive, but we're going to grow. This isn't a, you know, set the economy on fire. Um, and there's obviously debate about how stimulative this actual bill [00:19:30] was, because a lot of it's just extending current tax policy, because a lot of it was on the individual and family side and not the business side. This was not sort of the rocket fuel for the economy that some past bills have been like. In 2017, you were cutting the corporate rate from 35% to 21%. That immediately, you know, sent stock prices soaring and folks talking about how they would reinvest this money. And so, um, this [00:20:00] bill didn't have some of that, but it was very still very expensive. And, um, and so you had members like Senator Ron Johnson from Wisconsin and, and his take he had an interesting take. He said, we need to go to pre-COVID spending levels. You know, we dramatically increase. And he had these charts that would show the federal government dramatically increased their spending during Covid. And then it kind of tapered off, but they never went back down to pre-COVID. And [00:20:30] the idea is, you know, when you're when you're in a crisis, you increase spending. But then.

Annie Schwab: Of course.

Thad Inge: But he was saying you don't. That doesn't mean you maintain it forever. You should go back down when the crisis is over. Um, that, you know, while I heard a lot of people kind of behind closed doors, like, yeah, he's kind of got a point. That was never going to fly because no, to get to the levels he was talking about, it was going to mean massive entitlement cuts and, you know, massive other cuts. And he, um, you know, [00:21:00] he pushed that pretty far till the end. But they ended up, you know, I think the the politics of it all, he ended up in, on the Senate on I think it was for the cloture vote on the Senate bill. So the first procedural vote, he voted no. And then they were huddling. He was on the phone with the president, and then he came in right before and switched to. Yes, you know, um.

Roger Harris: There's the politics.

Thad Inge: Um.

Annie Schwab: Right.

Thad Inge: So that, uh, but [00:21:30] but that was one of the major, you know, there were two sides Of real opposition to this bill. One was, this is not sustainable. We can't spend all this money. We need to make more cuts. And the other was, hey, these Medicaid cuts are going to decimate rural hospitals in my state. It's going to put a lot of people, you know, take a lot of people off insurance in my state. And this is not acceptable. And you had conservative, you know, members from places like Missouri, West Virginia that were really, [00:22:00] um, worried about that. Um, but at the end of the day, most of them, you know, most of them voted for the bill.

Roger Harris: Yeah. And I think one thing we've got to remember, I think that cuts have two definitions in Washington. There are at times real cuts where we spent $10 last year. We're going to spend $8 this year. That's a cut also defined as cuts. Well, we were going to spend 14 instead of ten and we're only going to spend 12. [00:22:30] So that's also a cut because it's down from 14 even though it's more than ten. So when we hear people talking about cuts, you kind of have to cut through to find out, is it really a cut or is it a reduction in the increase in spending?

Thad Inge: And and there's different rules with reconciliation, you know, and how they, how they measure all these things. And then they used a different standard. Normally when a you know, normally you use current policy, um, uh, current law as your [00:23:00] baseline. And so if and not to get too in the weeds here, but if a tax cut is expiring and you want to extend it, that's a cost to extend it. Well, they decided to use something called current policy baseline which said, well, if it's law right now, even if it's expiring, if we extended it, we'll say it doesn't cost anything. Um.

Annie Schwab: And well, that doesn't seem fair either.

Thad Inge: And that's how they passed this bill. And they, they did it in a way where it didn't have to go by the parliamentarian. They were able to do it. The [00:23:30] fear with that moving forward with these fiscal hawks is you could come in and say, all right, we're going to pass this tax cut for six months, and then it will look like it doesn't cost that much because it's only six months. But then Congress can go extend it for free. You know.

Roger Harris: That's right. It's a baseline.

Thad Inge: So then you go make it permanent for free. And now that number doesn't change what the national debt is. Um, it just changes how, you [00:24:00] know, the accounting mechanism that the Congress is using to account for how much that costs, um, which is which was another controversial thing, but, um, but again, no one wanted to see all these taxes go up. So people kind of, you know, kept their mouths shut and went along with it.

Roger Harris: And I think you're right. The only way we're ever going to really significantly reduce our deficit is for our economy to grow. And now we produces, except in recessions. Correct me if I'm wrong. We collect more money every year than [00:24:30] the year before. Unless we're in a recession. The problem is, we spend more than we did the year before. More than we collected more. If you're really going to solve our deficit or debt problem, we're going to have to grow our economy enough to collect more money and it exceed any increase in spending so that we create some excess to apply back. We're not. We're not going to do. We're not going to eliminate Social Security or Medicare or cut them dramatically or anything like that. Uh, [00:25:00] no politician in the world is going to do that. And yet that's where most of the money's going.

Thad Inge: Yep.

Roger Harris: So.

Annie Schwab: There were some new ones. Um, two very popular ones or very, uh, I guess ones that you heard in the media a lot. Um, even even on the campaign. And Roger and I have touched on these in previous podcasts. Um, but the no tax on tips and the no tax on overtime. Both of those were hot topics. Um, got a lot [00:25:30] of press, I guess I should say. Um, and yet they're only, uh, both of them are only a deduction for from 2025. So it is retroactive back to January 1st through 2028, and then they're set to expire. Was that part of the negotiation. How did they get it to just be the four years.

Thad Inge: You know it was all about cost. Um, and so the initially and I think we kind of alluded to this when, when president now [00:26:00] President Trump was on the campaign trail and he went to Las Vegas and said, I'm going to eliminate taxes on, you know, tips. And then he said, went to, I think, Florida and said, we're not going to have taxes on Social Security. And, um, and I forget where it was, where he made the announcement on overtime. But, um, folks were kind of saying that would be so expensive and have such ramifications. It doesn't really seem realistic, you know? Um, but then you had Kamala Harris [00:26:30] come out, I think, the next week and say, yeah, no taxes. So it was very politically popular. You know, um.

Annie Schwab: Right.

Thad Inge: And so that was one of those areas when I said they started like a year early having discussions in the House. I think after President Trump got elected, there were a lot of discussions about, all right, this is a we're still hearing this a priority from the white House. They expect us to put this in the bill. What kind of guardrails do we have. How do we put this in there. And so they they put [00:27:00] things like salary like um, you know, income thresholds and some other guardrails. And the, the main thing the house did was put this cap, we're saying it would only go through 2028 because I think that the cost was just, you know, they were working within a set numbers. Right. And um, and the cost was just too much now that the Senate took it a step further and put some additional caps on there, like the like, um, no taxes on tips being capped at $25,000. [00:27:30] And then on overtime, they said 12,500 for individuals, uh, 25,000 for joint filers. Um, and so, um, it was trying to, to keep it in check. Um, but also, you know, include that priority for the, for the president.

Roger Harris: Yeah.

Annie Schwab: There's no tax on tips is going to be an interesting, uh, scenario as they move forward because it's so like it says, um, no tax on tipped income [00:28:00] where tipping is customary and paid voluntarily by the customer. Yet, I mean, obviously we'll see additional guidance come out to explain that. But I mean, just think of the restaurant business. I mean, all the businesses that now offer tips. I mean, my, my Uber driver, my DoorDash man, my, you know, dog groomer, all of the, all of these have, um, options for tips, but making it paid voluntary, that's hard to define or [00:28:30] I don't know where it's going to be very gray. It's gray in my head at least. Maybe we'll get guidance. That makes it clear, but for me, it's going to be hard.

Roger Harris: Yeah, and it's interesting because this is and you mentioned this, this is retroactive to January 1st. So we get this law in 4th of July and it goes back to January 1st. And it's going to create some, I think interesting dynamics. I know we've been asked a lot, what do you go tell the person who [00:29:00] either works in or owns a small restaurant. What do they do right now? I think number one, you have to kind of attack the myth that their paychecks are going to start going up, that somehow because this no tax on tips was passed, that a waiter or waitresses paycheck goes up because they'll take less tax. That's not true for 2025 because it's going to be a deduction taken when they file their 25 tax return.

Annie Schwab: Right.

Roger Harris: Um, so no real change is going to happen [00:29:30] on your week to week or paycheck. And the same is true for overtime. So the first myth that we need to debunk with our clients or the employees of those clients is don't look for an increase in your paycheck. Now, we'll talk in a minute about how you could make that happen, because that's a whole different discussion. So I think that's the first thing. Then the second thing is we have to wait and see to what Annie's point was. What is a voluntary tip? You know, um, what [00:30:00] the Treasury is going to give us the list of industries where they consider tipping is customary. But if you think about how the dynamics of a restaurant works and dad you, it's probably more true in DC than it is here in Athens, Georgia. But you walk in a restaurant and if there's six of you, they tell you we're going to add an automatic 20%.

Annie Schwab: Mhm.

Roger Harris: Is that a voluntary tip. I mean you volunteered to come in the restaurant knowing the rules, but let's assume that they say no, that doesn't count. Now, [00:30:30] does the restaurant do away with that? And if they don't, then how do you get a waitress to go wait on a six top table where the tips are going to be taxable? When there's a five top table sitting next to it, where the tips would be tax free. You know, how is the restaurant owner is going to navigate those realities of how their business works. And a lot of that's going to depend on what the IRS says is a voluntary tip. Mhm. And then what about tip sharing and tip pooling and all those [00:31:00] different.

Annie Schwab: I was about to say how is all this going to be documented or calculated or you know what kind of documentation is the the owner of the restaurant going to have so that they can give that information to the payroll company so that their W-2 accurately reflects what happens, because like, I'm sure the chef gets a bigger cut than the busboy. You know, or or and then the waitress and the waiter and the backup boy, you know, all of it. It's I. I wonder how it's all going to.

Roger Harris: Well, I think the the law. And [00:31:30] this is where writing a law is actually a whole lot easier than implementing it, because it's very easy to say, like you did, that, you know, tips are tax free up to this amount, and they have to be voluntary and they have to be in certain establishments. But then you got to think of all the nuances in all of that, that the, the IRS, who by the way, now is cut back by about 25% now has the pressure on them to come up with whatever, uh, guidance is going to be necessary. So if you're a small business restaurant [00:32:00] owner right now, I guess my advice is kind of sit back and do nothing but take make sure your employees understand their paychecks aren't changing right now. Yeah, they're going to get a nice big refund when they file their tax return. But until we get guidance, your paychecks aren't changing.

Thad Inge: Yeah. And and the fact that it's retroactive to To 2025 to January 1st, 2025 is where a lot of this confusion will go on because for 26, folks are going to, you know, wait for the [00:32:30] guidance, get the guidance, and hopefully there'll be some clear lines. Now, I think it's still to be complicated to to y'all's point. Um, but at least businesses, payroll firms, others can sort of develop the systems, develop the reporting parameters. That'd be pretty quick turnaround. But but they'll have a little bit of time for 25. That already happened yesterday. Right. Like why was this accounting. And they did add they added some language in the Senate bill because a lot of people, when it came out of the House said, well, how are we going to do this retroactively? [00:33:00] And they did add some, um, uh, some what they called transition relief. And it essentially said the Secretary of the Treasury can come up with some rules that allow employers and individuals to approximate a separate accounting of amounts designated as Tips, um, or overtime. And so it's it's saying we want to give give you some flexibility how you account for these. Because you know, the Fair Standards Labor Act is how they [00:33:30] they verify how you're supposed to track the overtime. But you have states, a lot of states that have a higher standard than that. So employers might be using that standard, not the FLSA standard.

Annie Schwab: Um, yeah. I didn't even think about that because a lot of states piggyback off of the federal AGI. But if the state's going to treat tips or overtime for that matter, differently, then now the states are going to have to weigh in.

Thad Inge: Well, yeah. Because if if the state has a higher standard. Yeah. And [00:34:00] then the employer and the, you know, the employee just goes by the state standard because they don't have to worry about the federal standard. Then they might not have it calculated. They might have that might not have that information at least for 2025 saved in that way. And so they tried to say, all right, we'll come up with something reasonable and we'll be okay.

Annie Schwab: But that reasonable, right?

Thad Inge: Yeah. Um, so, um.

Roger Harris: So this is the first time I can ever remember a law telling us we can guess, and it's okay. Yeah, exactly. As long as we can make [00:34:30] a reasonable argument as to what we guessed and and, you know, the whole state issue. I mean, again, it's going to be on the tax return for 20. Well, I think it's going to be on the tax return permanently until the expiration date. The question is and we'll talk about the withholding. But now all 50 states have different rules as to how they follow the federal tax law. So and when their legislatures meet and you know some it's automatic that whatever the federal rules are that state picks them up in other places. The legislature [00:35:00] has to meet and say, do we adopt the current federal law or not? So you could have Tips tax exempt on the federal level, but not exempt on the state level. So when are the states going to get around to making a determination. So it's going to complicate state filings. Uh, yeah.

Thad Inge: And and you guys are probably aware of this. Um, but Alabama exempted, um, overtime from taxes, uh, for I think that was the last couple years. Uh, they just let [00:35:30] it expire. And apparently it was a a big mess.

Annie Schwab: Um, administratively, I think it was.

Thad Inge: A big mess administratively. And it also cost the state way more than they thought, like in tax revenue. It was extremely expensive. Now, it wasn't the exact same as this. I don't think it had some of the limits and, and whatnot, but um, but yeah, they decided to let it expire, uh, because it was extremely expensive. And then I know to implement it was very challenging.

Roger Harris: Well, and there's [00:36:00] another issue when it comes to overtime, it's kind of a flipping of the script, if you will. One of the big challenges with the Fair Labor Standards Act was we were a lot of small businesses were trying to pay people salaries to get around the overtime, and so they were looking within the law as to how they could pay someone who's working 60 hours a week, a salary, and therefore be exempt from overtime. Now all of a sudden that employees are going to say, wait a minute, I don't want a salary anymore. I want to be paid hourly. [00:36:30] So some of that money is tax exempt. So where before we were trying to find a way to make them salaried. Now we may find out that our clients and our employees are going to want to be non-salaried. But again, this expires in at the end of the Trump term. Theoretically, I mean, it can always be extended. It's just going to create a lot of dynamics beyond just what the law says. And that doesn't even touch on the fact and and, Ted, you and I have worked on this. And Annie, you have to [00:37:00] the IRS has told in these bills that they have to come up with some new withholding rules to.

Annie Schwab: Tables.

Roger Harris: Tables, and whatever the case may be, so that going forward, you don't have to wait until you file your tax return to get a benefit. Well that's just going.

Annie Schwab: To be that would be 2026.

Roger Harris: 2026. That's just going to throw everybody back onto the W-4 form, which from my opinion still people are still trying to figure out how to put single with two on the form. And we all know that's not how the form [00:37:30] works. And I don't know how you make the law more complicated and the form simpler. And that's what you know, I think it may create a nightmare where people will go fill out a new W-4 form and have more tax taken out when they should have less taken out. So I would hope, and I think I will make this suggestion, not that anybody will listen, that if we're going to have to make these changes, let's take an examination of how to make this W-4 work for the average person. [00:38:00]

Annie Schwab: Because it is very confusing right now.

Roger Harris: Yeah, I don't the story I've always laughed at is somebody said, well, here, you got the job. Now go back in this room and fill out this W-4 and whenever you're ready, come on out and go get them, because they couldn't figure out how to fill out the form. So they. Yeah, they never came out of the room, you know, to actually take the job because, I mean, people have said, if I can fill out the W-4, I can do my own taxes, but I can't do that either. So, uh, a lot of interesting our clients, you know, again, to your small business [00:38:30] owner or your employee, don't worry about it right now. Nothing's changed today other than you're going to get a nice big refund when you file your taxes. We really kind of. I guess that sounds like we're kind of depending on the IRS now to make.

Thad Inge: And in Treasury, it'll be the Office of Tax Policy at Treasury. And Ken Keyes just got, um, just got, uh, confirmed by the Senate to be the, the head of that office, um, along with, along with the IRS and, [00:39:00] um, I think for some of these things, they have 90 days, I think for the withholding, uh, maybe it's 90 days. They have to write, uh, guidance and regulations and, um, and they're, you know, they're working overtime. Uh, no. No, no pun intended. Um, right. Um, to try to get this done and, um, but you know.

Annie Schwab: What happens if they don't meet the 90 days?

Thad Inge: Well, you know, I think to me, the bigger thing is just [00:39:30] all of the provisions. I mean, they have to prioritize, right? Right. And so there's going to be certain provisions that they prioritize. It might be the ones where they have statutory deadlines, but also just the ones that are priorities to the president or that are the big ticket items. Um, but there's all kinds of, you know, small things in this bill that are going to need guidance, need FAQ. Oh yeah. Need implementing regulations for. And so they've got their cut their work cut out for. I mean we saw this during Covid. [00:40:00] We saw um, you know, with the Inflation Reduction Act and other pieces of legislation. It probably won't be as chaotic as, as Covid. When we were waking up on Saturday night to see if they would release the, you know, the regular, the FAQs. And that really was a 24 over seven. You know, especially the accounting profession was just, you know, tracking that nonstop because it was so important. But it's going to be, um, there's going to be a lot of activity and a lot of attention paid to [00:40:30] what's coming out because, um, it's going to impact how how employers and accountants and others, um, you know, do their business payroll company.

Roger Harris: Yeah. And the hours to they're, they're, they're they seem confident. I mean, I don't think they're telling you that this is not going to be a challenge. But as they say, we've dealt with this before. Changing tax laws isn't new. Changing forms isn't new. Well, and I don't know, last time they had to do something this major. How many people work there? I mean, they [00:41:00] got fewer people that work there last year. I don't know where the.

Annie Schwab: Resources, money.

Roger Harris: Yeah.

Annie Schwab: Less money.

Roger Harris: And one other thing, since we were talking about co, you brought up Covid. Uh, there's an IRC provision in here. So Annie, we have to talk about it because we talk about IRC. It seems like every webinar. So um, who wants to tell us what happened with IRC because it's fairly substantial.

Thad Inge: Um, I'll kick that off because that's when I was watching closely. And, you know, the R&D bill, [00:41:30] as we all watched last year, that was the the Jason Smith, Ron Wyden, uh, bipartisan bill that that passed last Congress, passed out of the House and never made it in the, um, in the Senate, had a provision to help pay for that bill. And at that time, they said that this would raise like $80 billion. That later got revised. But and so it had a lot of new enforcement stuff around the mills and increased, increased fines and all of that. But it also had a cutoff [00:42:00] date where it said, um, if you did not file this before January 31st, 2024, then the IRS cannot pay pay this credit out.

Annie Schwab: Essentially ending it won't process, right?

Thad Inge: Yeah. When it was first introduced, it actually wasn't retroactive because I think it was January 24th when they introduced this. It quickly became retroactive because, you know.

Roger Harris: I didn't get around.

Thad Inge: To the provision the same. This got very when you talk about the Byrd rules and reconciliation rules [00:42:30] and stuff, this got very complicated when I said you kind of had to like read these bills really, really carefully because there's a lot of confusion. There's still a lot of summaries of the bill out there that, that, that have this wrong. I saw one, um, on Friday. And so the, the Senate, the House initially the bill that passed the House initially had this provision as is same as in the R&D bill. And then they started hearing from the Senate [00:43:00] that there were some technical issues with Byrd and how it impacted Social Security, because you can't mess with Social Security taxes on a on a reconciliation bill. And so they did this kind of backdoor amendment where they amended it in the House, but they didn't have to pass the whole bill. Again. They were able to just change this one provision.

Annie Schwab: Technical correction or.

Thad Inge: Basically a technical correction. They did it as part of a resolution. And you know, when when people [00:43:30] first looked at the language, they were like, oh, it didn't really change that. Then it came out in the Senate. And so the thought was, well, maybe they'll take all this out of the Senate.

Annie Schwab: Mhm.

Thad Inge: And, and I back up a little bit. They took all of that out of the House bill. And then the bill came out in the Senate. And it just had a little tweak to the language. And, and at first it's like oh they put this back in there. Well if you read it really carefully. Um, basically what they said was if [00:44:00] it was the, if it was an irtc from the third or fourth quarter of 2021, 21. Then you could not get it if you filed, if you filed it after January 31st, 2024. But if it was from 2020 or the first two quarters of 21, it it pared it down where those aren't impacted. And so it's a pared down provision that was initially in the House. It still impacts folks that filed after January 31st 24, but only for [00:44:30] those two final quarters in 2021. Um. Got it. And so sorry if that was a little in the weeds, but I just.

Roger Harris: Wanted.

Thad Inge: To get that out because there's been a lot of confusion on that. And, um, and so there's an impact there, but not as much as people initially thought it was.

Roger Harris: I think a lot of people just looked at the date and thought anything filed after that date.

Thad Inge: Exactly.

Roger Harris: Don't get. But it's it's those last two quarters of any I think. Didn't it also increase some penalties and define the definition of. I don't know what [00:45:00] they called it, but if you if you did a certain amount of ERC claims for a certain amount of money, you're subject to higher penalties. Now, if you're fraudulent or something like that. And also, I think extended the statute for the.

Annie Schwab: It did extend the statute.

Roger Harris: So it did I mean, they did certain things. But like I said, you don't think about the Byrd rule, but you are tapping into Social Security when you're amending 941 and W-2s and all that sort of stuff. I mean, yeah, now you're into Social Security. So now we got to come up and figure out what is the Byrd rule, what does it have to do with IRC? [00:45:30] I don't know, I think we're all ready for this to just go away.

Annie Schwab: I was about to say, any idea how many, um, claims are still in backlog waiting to be processed?

Thad Inge: That's a great question. I think a long time ago, the IRS stopped updating their website. It used to be able to go on there and see where they stood, and then at some point they were like, we're not going to update this anymore. Um, and so now the the eventual amount that they said this provision raised, um, [00:46:00] now granted, it's just the third and fourth quarter. Um, right. But I think they said it raised like 3 or $4 billion. So it was no longer the, um, uh, the.

Roger Harris: Cash.

Thad Inge: Cow, the 80 billion that they said it was going to be. Um, and they might have even said that with the house. So everyone knew that that number, that this really wasn't $80 billion, but. Right. Um, but yeah, there are claims still out there and presumably the IRS, now that this has passed, you know, they had sort [00:46:30] of been paused, kind of waiting to see what happened with this, saying they were dealing with with fraud and stuff. Um, but eventually they're going to need to pay these out for the legitimate, you know, legitimate claims.

Roger Harris: And, and they'll have a little more ammo to go after the, the mills or the fraudulent people so they'll be able to go out assuming they have time to go after them. Yeah, but they'll at least have a little more ammo. Yeah. Um, let's touch on a couple of other business things that were made. Um, [00:47:00] you know, we've touched on R&D, but we got to gotta remind people that, I mean, you and I, Thad went to a joint hearing. I guess it was a year ago with the Small Business Committees and Finance Committee, and it was like 199 A was being paired with R&D expensing as the two things that had to get done. And um, I guess you could argue they got them both done. We got 199 A. And we're back to expensing of R&D. Uh [00:47:30] expenses.

Thad Inge: Yep. So so R&D is retroactive to January 1st 2025. Um, one difference with the you know we talked about the widened Smith bill that did not pass last Congress. One major difference is they went further back retroactively because, um, I you know, I don't want to quote the exact years, but this started the R&D started phasing out a couple years ago for the immediate expensing. And people won't be made completely whole, [00:48:00] for example, 2024. They won't be able to go back and immediate expense everything in 24, but they will for 25. And um, as you said, this was a, you know, major priority of both small and large companies. I mean, the major sort of, you know, defense firms and technology companies and all kinds of firms were really pushing this. But you also had lots of stories of small businesses that, um, that are maybe in the biosciences or other areas where this [00:48:30] was crushing them because in the past they were able to, you know, they were getting hit with tax bills that they had never been hit before because they weren't able to write the stuff off. Um, so that one was big. And then you had the business interest expensing and depreciation deductions.

Thad Inge: Right. Um, those always came as a, as a trio because they were things that, you know, when they passed. Um, Tcja the the way they justified reducing all the rates, especially the corporate [00:49:00] rate going from 35% to 21% and doing this 20% deduction, as they said, we should make these individual deductions less favorable and just bring the rates down, you know, flatten the tax code, make it less complex. And so that was when they said, well, we'll bring the rates down, but we'll also phase out sort of make an R&D so favorable the business interest expensing depreciation deductions. Well similar to this bill with some [00:49:30] of the Medicaid provisions they said we won't actually have that go into effect until for a few years. You know we'll keep it the same for now. People can have the low rates and the deduction and then starting and you know, 4 or 5 years we'll have this start to kick in. So when it kicked in, people kind of conveniently forgot who had whose idea this was. Yeah. And they just said, this is outrageous. This is an attack on business. Let's, you know, um, we.

Roger Harris: Gotta change.

Thad Inge: This back. And so, you know and [00:50:00] businesses we're talking about how they don't have to lay people off and everything else. And so this became a big priority really on on both sides of the aisle. Um, I mean, you had widened on that, you know, initial bill that the lead Democrat on finance committee with Jason Smith. And so, yeah. So they restored that stuff. So 100% bonus depreciation. Um, you know, on certain things, the business interest expensing was adjusted to make it more favorable and then R&D. And importantly all [00:50:30] these things were made permanent permanent.

Annie Schwab: That's what I was going to say. None of these have a time cap yet.

Thad Inge: In the House bill they did to make it fit uh financially. And then the Senate, especially Chairman Crapo was big on we got to make these things permanent. And that's one of the the ways where this we talked about the current policy baseline, where you can say it doesn't, you know, doesn't cost anything, help with these as much as it did the other tcja provisions. But but anyway, [00:51:00] they were able to use, you know, they were able to move things around and make these permanent.

Roger Harris: Yeah. Uh, there were a couple of other new things that while we have some time before we run out of time, uh, comment on you mentioned the other part of the kind of the trio that Trump pushed during the election was no tax on tips, no tax on overtime, no tax on Social Security. Social security was just way too expensive. But they did come up with something for seniors, right?

Thad Inge: Yeah. And that [00:51:30] that rule that I told you where I said you can't mess with Social Security on reconciliation was the other thing. So they kind of came up with a roundabout, which.

Annie Schwab: Right.

Roger Harris: Yeah. It's just a deduction. And you're still.

Annie Schwab: Just a larger deduction for for taxpayers over 65. Yeah. So you'll get you get a $6,000 deduction. Um and that is just through 2028 right. So it's on top of the regular standard deduction. Um, so and there are some [00:52:00] income thresholds there. But I think that was I agree. I think that was the roundabout way of getting no tax on Social Security ish to, to the to the taxpayers over 65.

Roger Harris: And then we have a new deduction for interest on car loans. Um, if I think I've got this right, if the final assembly took place in the United States, as opposed to where was the tires made and where was the transmission [00:52:30] made or the upholstery? So final assembly in the United States, I believe it's up to 10,000. Did I get that right?

Annie Schwab: 10,000?

Thad Inge: Yep. And it's for, um, the individual income threshold. So it's 100,000 for individual filers and 200,000 for, um, uh, for joint filers. And then, you know, after that amount, it's it's I believe it starts to phase out, but Um, but, um, yeah, I mean, this is one of those where when I think [00:53:00] President Trump made this promise on the campaign trail, most people thought, well, that's never gonna happen, you know? Um, and sure enough, it never.

Annie Schwab: Say never with him, apparently.

Thad Inge: Exactly. So, I mean, this one will be will be interesting if it, you know, drives some. Um.

Roger Harris: Yeah.

Thad Inge: Drives.

Annie Schwab: And is that one retroactive to. So if you bought a car in the beginning of January and beginning of 2025.

Thad Inge: Yep. It's those same dates. So 2025 through 2028.

Roger Harris: Yeah. I heard someone have to explain why does this [00:53:30] one expire? And the answer was, well, this was Trump's idea. So it goes away with he goes away.

Annie Schwab: Oh well maybe you never know because you never know. It could happen by 2028.

Roger Harris: And another pay for we're not going to get into all of them. If you were planning to buy an electric vehicle or do a lot of, uh, work on your house for energy credits, one of the payfors is basically we're we're wiping out most of the the stuff that was in the was it the Inflation Reduction Act that put a lot of this energy stuff [00:54:00] in, in the Biden administration and this bill's phasing out or taking out a lot of them?

Annie Schwab: Yeah. It's weird. It's like certain ones go and then next year some go. So it's not like a total wipe out all at once. But um, there's several that are.

Thad Inge: And these were subject to intense negotiation, especially in, especially in the Senate, because most of the conservative Freedom Caucus members said these are Biden tax cuts for, you know, green energy. We got to get rid of them completely. [00:54:30] But then you had other folks that had businesses in their districts that were doing these huge products. I mean, projects based on these credits.

Roger Harris: Building these batteries and things.

Thad Inge: They were saying, we've invested all this money. You can't just roll this back, you know? And so that became a major sticking point, um, and was subject to some negotiation.

Roger Harris: Yeah. So if you're getting ready to think you're going to what was it, $7,500 credit on certain vehicles, I'd say, you know.

Annie Schwab: Watch out. Double check your [00:55:00] date.

Roger Harris: Double check your dates to make sure before you go buy that electric vehicle.

Thad Inge: And some people thought that's why Elon was so upset. You know, I don't know. I don't know if it's just that one thing, but it was, uh. Yeah. Tesla was not in favor of that.

Annie Schwab: I can imagine, no. Yeah, right.

Roger Harris: All right. What else do we need to cover? We're getting close to the end of time here. What have we. Have we missed anything or, um.

Thad Inge: I mean, I think it's the point that this is going to be all about implementation, right? I mean, we [00:55:30] everyone's still absorbing this bill. I mean, there's so much there, I think that, uh, it's still kind of sinking in. And then they're going to start putting out regulations and guidance, and we'll see how this plays out, both for individuals and businesses. But um, and then there's already talk about, well, maybe we should do. I think they saw that Trump was able to muscle this through. And so Republicans said, well, maybe we should do another reconciliation.

Annie Schwab: Oh, God.

Thad Inge: And, uh, and [00:56:00] then, uh, they said, well, what would we put in it? And Senator Ron Johnson said Medicaid cuts and others were like, no, not that again.

Annie Schwab: Oh.

Thad Inge: And so, uh, there's that, you know, there's some things that didn't get in this bill, the work opportunity tax credit, you know, an example. And there's other bipartisan provisions that folks said, well, maybe we could do a bipartisan bill at the end of the year, you know, on some tax provisions. But but that takes feeling's not being too burned, which I think right now that's still pretty raw.

Annie Schwab: Um, [00:56:30] yeah.

Thad Inge: So yeah, it'll be there will be action over the next six months. But but I don't think we're going to see any legislating as big as this.

Annie Schwab: You can't get anything more. I mean, they can't give the Treasury or the IRS any more work between now and the end of the year. It's just getting ready for next tax season is going to be tough.

Roger Harris: Yeah, I think we quit watching Capitol Hill now and we switch over to the IRS, because now everything's kind of been handed over to them now to to hopefully get this done and [00:57:00] get our filing season off on time with new forms, new guidance, new regulations. Again, I know there's a lot of questions that probably our listeners and their clients have. You know, we'll be back as soon as we know the answers. But right now we're we're like you, we've got the bill. We're all reading it. The ad mentioned, you know, you read one thing one day and it's something wrong, and you read something different the next day. And one of these days it'll clear up.

Annie Schwab: Maybe everybody's trying to digest it and determine what it means for them. What are my planning opportunities? What are, you [00:57:30] know, what should I be looking at? A small business owner or individual or somebody over 65, you know, someone with starting a family? There's all different kinds of planning opportunities depending on where you live, what time of life you're in. You own a business. You don't own a business.

Roger Harris: So all right, two last quick points that we got to mention. Don't take a lot of detail. Uh, the 1099 reporting goes back to all the pre stuff, you know. So you you won't be getting a 1099 K for selling a sofa at a yard sale anymore. It's [00:58:00] back up to what is it, $20,000, 200 transactions. So that was the original. And this one will really impact a lot of small businesses. The the the 1099 uh, miscellaneous and neck's been 600 for God knows how many years. I can't, I don't remember. I think it's been 600 as long as I've been doing this, which is forever. That's now been increased to 2000. So you'll have a few less 1099 to issue.

Annie Schwab: Um, I.

Roger Harris: Don't know what impact that'll have on IRS compliance, because that means [00:58:30] they'll have less reported income from independent contractors.

Annie Schwab: Notices on that will be different.

Roger Harris: If they earn, you know, more than 600 but less than 2000. So that's a good burden reduction. We'll see what impact it has on compliance. But uh, that's also in the bill.

Thad Inge: And that's and that's one. So when, when, uh, Jason Smith first became chairman of the Ways and Means Committee, he made a big deal about we're not going to be in Washington. We're going to go do field hearings. We're going to hear from everyday Americans. And [00:59:00] if you asked them, well, what's your agenda? He would say, listen to my field hearing. Listen to my field. And I think that's the one sort of substantive policy idea that came out of those hearings that he was very excited about, because someone in one of those field hearings said, why isn't this, you know, index to inflation? It's been like this forever.

Roger Harris: It's index to. That's right. Right.

Thad Inge: And so and so he he kind of ran with that and would talk about, you know, a common sense, you know, thing to to increase this significantly [00:59:30] since it hasn't been increased in, you know.

Annie Schwab: So long. Yeah.

Thad Inge: So um, anyway.

Roger Harris: So tax policy is being written by a small business person in Missouri, a waitress in Nevada, a factory worker in Michigan, and who knows what else. But, hey, sometimes you get good policy that way.

Annie Schwab: Mhm. Well I'm glad we just got something passed and we're not still sitting here listening back and forth between Senate and Congress and.

Roger Harris: Yeah.

Annie Schwab: All the above.

Roger Harris: So Thad thanks [01:00:00] as always. It's always you always do such a good job in making it clear and explain to everybody. And, um, thank you as always. I'll see you in a couple of days in DC. We'll see what craziness. Like I said, now, now we'll we'll be at the IRS because ball's in their court.

Thad Inge: Exactly. That'll be interesting. No thank you, Roger. Thanks, Annie.

Annie Schwab: And you're very welcome.

Roger Harris: Any any final words before we.

Annie Schwab: Know this has been fantastic, very, very enlightening, especially about how the process works [01:00:30] and and how they got to where they got and how they did it so fast. I agree. Yeah. July 4th to me sounded like a far stretch, but, um. So thanks.

Roger Harris: Well, we can put this in the rear view mirror. Thad, I think your job's safe. There'll be something else coming down the pipe in the near future. It probably already is, but thanks for coming and sharing with our audience. Uh, kind of how we got here and where we are and where we're still going. It's always a pleasure to have Thad join us. [01:01:00] And, uh. Always. Annie. Always good to see you and look forward to to our next podcast. And we can put IRC in the back. Bill B-b-b in the back, rear view mirror. We might can touch on some other stuff here in the future, but we'll see. They're still coming to Washington, so something can still happen.

Thad Inge: Right?

Roger Harris: All right everybody, thank you for tuning in for another federal tax update podcast. Hope you enjoyed today's podcast. If you did tell a friend, if you didn't, keep it to yourself, [01:01:30] uh, we'll be back again soon. Thanks, everyone.