Congress locks in tax cuts for middle class—but caps deductions for high-tax states
H.R. 137 — TCJA Permanency Act · Filed by Vern Buchanan (R-FL) · 53 cosponsors · Introduced Jan 3, 2025 · Referred to committee
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What it does
This bill makes permanent the individual income tax provisions from the 2017 Tax Cuts and Jobs Act that were set to expire after 2025. It locks in lower tax rates across all income brackets, increases the standard deduction and child tax credit, expands education savings accounts, and eliminates the personal exemption deduction. The bill primarily benefits middle-income and upper-income households through lower tax rates and higher credits, while eliminating deductions that primarily benefited higher earners.
Why we flagged it
The bill's core function is to extend expiring individual income tax cuts from 2017 indefinitely. It is not deregulation or a narrow carve-out, but a broad tax policy choice affecting millions of filers. The mix of benefits (lower rates, higher credits) and costs (lost deductions, permanent SALT cap) makes it a genuine policy trade-off, not a simple tax cut.
- Section 126 extends tax exclusion for U.S. military personnel serving in Sinai Peninsula—unrelated to individual income tax permanency.
What the text implies
- Permanent SALT cap at $10,000 disproportionately affects high-tax states (CA, NY, NJ, IL) and high-income filers in those states, creating a de facto regional wealth transfer.
- Elimination of personal exemption deduction increases effective tax burden on all filers, offsetting some benefit of lower brackets for middle-income households.
- Mortgage interest deduction cap at $750,000 (down from $1M) reduces incentive for home purchases above that price, affecting real estate markets in high-cost areas.
- Expansion of 529 education savings to homeschooling and tutoring may benefit higher-income families with resources to use these accounts; lower-income families less likely to benefit.
- Permanent child tax credit at $2,000 (with $1,400 refundable portion) locks in benefit but caps refundability, limiting benefit to lowest-income families.
Section numbers refer to the bill text the analysis read — linked under Primary records below.
Who it affects
Middle and lower-income households benefit from permanently lower tax rates, higher standard deductions, and expanded child credits. However, the bill eliminates the personal exemption deduction (a cost to all filers), caps state and local tax deductions at $10,000 (harming high-tax-state residents), and limits mortgage interest deductions (affecting homeowners). The net effect depends on income level and state of residence.
Who stands to gain
- Middle-income households (via lower tax brackets and higher standard deduction)
- Families with children (via expanded child tax credit)
- Homeowners with mortgages under $750,000
- Education savers (via expanded 529 accounts)
Named in the bill
Internal Revenue Code of 1986, Tax Cuts and Jobs Act (Public Law 115-97), IRS, Section 1 (income tax rates), Section 24 (child tax credit), Section 63 (standard deduction), Section 164 (SALT deduction cap), Section 163 (mortgage interest deduction), Section 529 (education savings accounts), Section 112 (military service exclusion)
Where it stands
53 cosponsors: 53 Republicans.
- Jan 3, 2025 — Introduced · Congress.gov: “Introduced in House”
- Jan 3, 2025 — Referred to House Committee on Ways and Means · Congress.gov: “Referred to the House Committee on Ways and Means”
Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.
Money around this bill
2 lobbying clients named this bill on 3 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $320,000 in lobbying spend. A filing names 13 bills on average, so that figure is what each filing reported, not a share belonging to this bill.
More lobbying clients named this bill than 41% of bills with at least one filing.
Vern Buchanan, the sponsor, reported $544,700 in PAC receipts in the 2026 cycle.
- Philanthropy Roundtable — $280,000 on 2 filings
- New Venture Fund — $40,000 on 1 filing
Lobbying Disclosure Act filings through Jul 20, 2026. A filing shows who paid to lobby on a bill it names, not what changed.
How this was measured
Analysis — Quorum's AI read the bill text published by Congress.gov (50,094 characters) on Sep 23, 2026. Section numbers in the findings refer to that text, linked below; transparency and hidden-provision scores are compared against the median of 14,707 analysed bills.
Status and sponsors — Congress.gov's bill record — actions, committee referrals and cosponsors — loaded nightly. The timeline shows status changes, not every procedural action.
Money — Senate Lobbying Disclosure Act filings whose specific-issue field names this bill for quarters ending Dec 2025 to Jun 2026. A filing's amount is reported whole beside the median number of bills a filing names; it is never divided across them. PAC receipts are FEC-reported contributions to the sponsor's candidate committee in the 2026 cycle.
As of — lobbying records through Jul 20, 2026 · page rendered 2026-09-23.
“Congress locks in tax cuts for middle class—but caps deductions for high-tax states” QuorumCivic. https://share.quorumcivic.app/bill/119/hr137 Report an error