In this episode of S&C’s Critical Insights, S&C Tax Co-Heads Isaac Wheeler and Davis Wang, along with Tax Counsel Bella Schapiro and Special Counsel Aharon Friedman, discuss the background, process and tax implications of The One Big Beautiful Bill Act.

A preview of the conversation can be found in the Q+A below.

Isaac: Aharon, was there anything interesting about the timing of The One Big Beautiful Bill, maybe relative to other reconciliation bills?

Aharon: I think a good comparison to this bill is the Tax Cuts and Jobs Act or TCJA, which wasn’t signed until December 22, 2017, and I think that relates to a lot of the fundamental differences between the TCJA and the OBBBA. I think a real difference in the process in 2017 was that the bill followed more of a “respecting congressional traditions” with regards to how markups are conducted and how legislation moves. Another key difference was that the Senate Finance Committee actually held the markup in 2017. They didn’t hold the markup this time around. Also in 2017, there was a formal Conference Committee, which has become increasingly rare in recent decades. This time around the House passed the bill.

Isaac: Davis, do you want to discuss “carried interest”?

Davis: I don’t think that people thought that there was a need to have this in the legislation. On the other hand, on the campaign trail, President Trump had said that he was inclined to repeal the exception that carried interest had enjoyed. So, there was always this question of whether carried interest should in fact come back into play. But again, to the surprise of many, not only did it not make it into the legislation, it never touched any of the iterations of the legislation. It was not in the House bill or the Senate bill.