Accounting
Tough choices ahead in the federal, state and local tax landscape
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Whenever there has been single party control of the White House, Senate and House, there is the potential for a major tax bill, according to Dustin Stamper, managing director at Grant Thornton’s Washington National Tax Office.
“One of the reasons is that tax is one of the few things that can be accomplished through the reconciliation process,” he observed. “That allows the Senate to pass legislation with fewer than 60 votes.”
This is critical for the fate of the Tax Cuts and Jobs Act, many of the provisions of which expire in 2025. “I don’t think Congress is looking to blindly extend the TCJA in its current form,” said Stamper. He believes lawmakers will instead use the expiration as a trigger event to proceed with broader reform.
“They will be faced with some hard decisions to make between priorities,” he said. “Like most campaigns, they probably overpromised. Just extending the TCJA in its current form is estimated to cost $4.6 trillion, assuming the SALT cap is extended. If they end the SALT cap while extending everything else, the cost will approach nearly $6 trillion, and that’s before any of the tax cut promises made on the campaign trail. There were times over the summer when it felt as though a new tax cut was proposed at every campaign stop. Tips, overtime, Social Security, Americans living abroad, a deduction for loans to purchase domestic cars — they can’t afford everything, so they will need to make some tough choices.”
“The campaign themes are sometimes more important than the details, because campaign platforms have one purpose — to get the candidate elected,” he said. “They don’t have to be politically feasible or technically sound or administratable. Everything will change or evolve as they go through the legislative process. One of the important themes is that Trump was very focused on more populist tax proposals benefiting individuals, and that’s different from his message in 2015, when he was focused on making corporations more competitive globally. That’s more of an afterthought this year. So despite a business-favorable Republican majority, there should be some concern in the business community that some of the individual tax cuts get prioritized over business proposals.”
There are separate issues from a SALT perspective, according to Jamie Yesnowitz, principal and state and local tax leader at Grant Thornton’s Washington National Tax Office. First, in a ballot initiative, voters in Washington State decided not to repeal a long-term capital gains tax put into place in 2022. Oregon rejected an increase in the corporate minimum tax, North Dakota voters rejected a potential repeal of the property tax, and South Dakota rejected a repeal of a grocery tax on grocery items.
“The common theme of these decisions was that the voters were willing to leave legislative choices alone,” said Yesnowitz. “They were not willing to adopt new provisions that would impact states significantly. From the state perspective, that’s important. Most states are controlled by one political party — the governor and both houses. In that situation, when there is control of the whole governing apparatus, there is more likely to be consideration of significant tax reform.”
“In Louisiana, the legislature is currently in special session, where there is Republican control with a potential of significant tax cuts and a potential expansion in sales taxes,” he continued. “In the recent state elections, there were no changes in governors, but in the state legislatures, Democrats in Michigan lost their trifecta, and the House in Minnesota appears tied.”
Changes in the corporate income tax on the federal side might have a significant effect on state corporate income taxes, since nearly all states are tied to the federal tax, Yesnowitz observed.
“It will cause states to rethink their conformity to the federal tax,” he said. “It’s similar to what we saw with the TCJA and the CARES Act in response to the pandemic. And to the extent to which cuts on the federal side are significant, there will necessarily be some level of cuts on the federal side, which could cause cuts on the part of states, since the federal government subsidizes a certain amount of state activity. That pressure may force states to reconsider their tax issues, potentially leading to an increase in state income tax as well as sales tax in many jurisdictions.”
Big Four firm PwC announced new agentic AI capacities, including a model that proactively identifies areas of value leakage and acts inside the tools teams already use to fix them itself.
The new solution,
The software, which is supported by PwC’s recently released
The system connects directly into ERP environments, continuously monitors key metrics, and acts inside the tools teams already use. For example, a supply chain agent might detect rising shipping costs and automatically reroute deliveries to reduce spend. Finance agents can spot and correct billing errors before they reach the customer. Clients typically see measurable efficiency gains in the first quarter, with continued improvements over time as the system learns and adapts.
“Too many transformations still rely on one-off pilots and stale data, stretching the gap from insight to impact and suffocating ROI,” said Saurabh Sarbaliya, PwC’s principal for enterprise strategy and value. “Agent Powered Performance flips the economics by distilling PwC’s industry transformation playbooks into AI agents that turn static insights into compounding gains, without rebooting each time.”
Agent Powered Performance is platform-agnostic and built on an open architecture so it can work across different LLMs based on client preferences and task-specific needs. It works with major enterprise platforms including Oracle, SAP, Workday and Guidewire.
Agent OS Model Context Protocol
PwC also
By integrating this standard, agent systems registered as MCP servers can be used by any authorized AI agent. This reduces redundant integration work and the overhead of writing custom logic for each new use case. By standardizing how agents invoke tools and handle responses, MCP also simplifies the interface between agents and enterprise systems, which will serve to reduce development time, lower testing complexity, and cut deployment risk. Finally, any interaction between an agent and an MCP server is authenticated, authorized and logged, and access policies are enforced at the protocol level, which means that compliance and control are native to the system—not layered on after the fact.
This means that agents are no longer siloed. Instead, they can operate as part of a coordinated, governed system that can grow as needs evolve, as MCP support provides the interface to external tools and systems. This enables organizations to move beyond isolated pilots toward integrated systems where agents don’t just reason, but act inside real business workflows. It marks a shift from experimentation to adoption, from isolated tools to scalable, governed intelligence.
Research Composer
Finally, a PwC spokesperson said the firm has also launched a new internal tool for its professionals called Research Composer, a patent-pending AI research agent embedded in the firm’s ChatPwC suite, designed to accelerate insight generation by combining web data with PwC-uploaded content.
Professionals will use the Research Composer to produce in-depth, citation-backed reports for either the firm or its clients. The solution is intended to enhance the quality of client work by equipping teams with research and strategic analysis capabilities.
The AI agent prompts users through a step-by-step research workflow, allowing them to shape how reports are packaged—tailoring the output to meet strategic needs. For example, a manager in advisory services might use Research Composer to evaluate white space opportunities across industries or geographies, drawing from internal reports and up-to-date market data.
Eide Bailly, a Top 25 Firm based in Fargo, North Dakota, is growing its presence in the Pacific Northwest by adding Traner Smith, based in Edmonds, Washington, effective June 2, 2025.
Traner Smith’s team includes two partners and 16 staff members and specializes in tax compliance and advisory services. Financial terms of the deal were not disclosed. Eide Bailly ranked No. 19 on
Eide Bailly already has offices in Seattle, but hopes to grow further in the Pacific Northwest. “We’re pleased to welcome the talented team at Traner Smith to Eide Bailly,” said Eide Bailly managing partner and CEO Jeremy Hauk in a statement Monday. “Their expertise with high-net-worth individuals, real estate and privately held businesses aligns well with our strengths, and their client-centric approach is a perfect cultural fit. Having an office in Edmonds, Washington, is a great complement to our existing presence in Seattle. Together, we’re poised to deliver even greater value to families and businesses in the Seattle metro area.”
“Joining Eide Bailly is a natural next step for us — it provides access to deeper technical resources in areas like state and local tax, national tax, succession planning and international tax while allowing us to continue the personalized service our clients value,” said Kevin Smith, a partner at Traner Smith, in a statement.
“With this expanded support and platform, we’re excited to grow our reach, elevate what we do best, and help more clients than ever before,” said Shane Summer, another partner at Traner Smith, in a statement.
Eide Bailly has announced several other mergers in recent weeks. Earlier this month, it added
In 2023, Eide Bailly added
Top 100 firm
“We began working with Knuula in Spring 2024 to streamline our engagement letter process,” said Don Murphy, Managing Member of BMSS. “It quickly became clear that Knuula was not only a strong solution for us, but also an ideal partner in advancing industry-wide automation.”
While the specific terms of the deal were not disclosed, a spokesperson with Knuula said that, after this investment, BMSS and a collection of 21 of their partners now own 13% of the company. The investment represents not some passive revenue deal but an active collaboration between the two companies, with the spokesperson saying they will be working closely together on things like product development, new features, improvements, and networking.
The deal comes about a year after Knuula integrated with QuickFee, a receivables management platform for professional service providers, which allowed users to have engagement letters directly connecting to their QuickFee billing platform, tying the execution of the letter directly to the billing process.
“We’ve long sought to partner with a firm focused on strategic innovation in the accounting space,” said Jamie Peebles, founder of Knuula. “To develop a perfect solution for large firms, it is ideal to have a partner that is willing to work closely together and iterate quickly. This requires constant feedback between our two teams. The IT team from BMSS worked with our development team constantly and helped us iterate rapidly. We also had consistent input from partners, manager, and administrative staff to help us make valuable changes to Knuula. BMSS was a perfect partner for us.”
PwC AI agent acts proactively to preserve value
Eide Bailly merges in Traner Smith
BMSS announces investment, collaboration with Knuula
New 2023 K-1 instructions stir the CAMT pot for partnerships and corporations
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