Ensuring Better Interest Treatment and Deductibility Act (EBITDA)
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Senate
- Passed House
- To President
- Became Law
Overview
This bill, the Ensuring Better Interest Treatment and Deductibility Act (EBITDA), aims to modify how interest expenses are treated for tax purposes. Specifically, it repeals a provision in the Internal Revenue Code that limited the deductibility of business interest based on adjusted taxable income. This change is intended to make it easier for businesses to deduct interest expenses, potentially boosting investment and economic activity. The changes will take effect starting in 2026.
Key provisions
- Repeals a section of the Internal Revenue Code (163(j)(8)(A)) that limited business interest deductions.
- Specifically targets the provision modified by Public Law 119-21.
- Removes a clause related to adjusted taxable income calculations for interest deduction limitations.
- The changes will apply to tax years beginning after December 31, 2025.
Who is affected
- Businesses
- Taxpayers
- Corporations
Notable changes
- Increases the potential for business interest deductions.
- Alters the calculation of adjusted taxable income for tax purposes.
Fiscal impact
This bill could potentially increase tax revenues for the federal government due to increased business interest deductions.
Bill text
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Sponsors
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9 on record
Primary sponsor
Cosponsors
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