Connect with us

Accounting

Trump bends Congress to his will on spending, tax cut agenda

Published

on

President Donald Trump is bending Congress to his will, hobbling minority Democrats with an everything-at-once strategy and rallying fractious Republicans behind his politically risky tax cut plan and billionaire Elon Musk’s cost-cutting crusade. 

That’s the backdrop for Trump’s scheduled address to Congress on Tuesday, five weeks into his second term and just over a week before a March 14 U.S. funding deadline that would ordinarily serve as a point of political leverage for the opposition party.

But Democrats are squeamish about a disruptive government shutdown and struggling to stymie Trump’s agenda, turning to the courts to blunt the effects of the president’s actions.

It’s all a remarkable contrast to Trump’s first term, when congressional Democrats were the face of an energetic resistance. Trump then failed to get Congress to rein in the burgeoning budget and expended political capital to wrangle his own party behind a tax cut bill. He and fellow Republicans also suffered the political fallout from two government shutdowns.

Now, however, an emboldened and experienced Trump benefits from a more compliant Congress, which has shrugged off legally dubious moves like unilaterally slashing the federal workforce and ending government contracts. His tax plan, which requires only a simple majority in both chambers, could be enacted as soon as May.

Democrats are training their attacks on that plan, which uses deep cuts in safety-net programs such as Medicaid and food aid to pay for tax cuts for the wealthy. But if Trump’s momentum keeps apace, at least through the spring, Democratic pushback will likely amount to little more than a 2026 election attack. 

Shutdown deadline

Democrats have, for weeks, tried to leverage talks to avert a government shutdown to tie Musk’s hands. But while Republicans need their votes to keep the government open, Democrats’ political pragmatism weakens their hand. 

“I’m not for shutting the government down,” said Representative Rosa DeLauro, the top Democratic spending negotiator in the House. 

Others in the party — even those with large numbers of federal workers in their states — expressed similar defeatist sentiments. 

Virginia Senator Tim Kaine said he’d like the spending bill to include language to prevent large government layoffs. “Whether that is practical I don’t know,” he said. 

And Maryland Senator Chris Van Hollen questioned whether Trump, who has ignored Congress’s constitutional power of the purse, would even abide by any new legislative constraints to his power. 

The emerging GOP plan ahead of March 14 in the House is a stopgap bill lasting to Sept. 30, essentially extending current funding to the end of the fiscal year. 

They’ll need to court Democrats in the Senate, where 60 votes are needed to overcome a filibuster. But the final compromise will likely amount to a status quo for DOGE — no new constraints or freedoms. 

Tax cuts

On taxes, Congress is moving with much more rapidity to enact a plan than in 2017, giving businesses and individuals more lead time to adapt to looming changes. 

Trump’s campaign proposals to expand breaks to end taxes on tips, overtime and Social Security, once considered wishful thinking, are even gaining momentum despite their costs.

Last week’s dramatic, down-to-the-wire vote on the $4.5 trillion House tax cut outline was a milestone in the GOP’s evolution toward unity, with Trump quelling a rebellion from fiscal conservatives through a few last-minute phone conversations. 

The budget plan would add nearly $3 trillion in deficits over 10 years and raise the debt ceiling by $4 trillion. Nonetheless spending hardliners voted for the compromise.

“It’s a new day,” said conservative Ralph Norman of South Carolina.

In the Senate, Republicans are eyeing a budget gimmick counting the extension of Trump’s 2017 tax cuts as zero dollars because it’s current policy. That gives them ample room for even more breaks for businesses and individuals.   

Republican House Speaker Mike Johnson, who discussed the idea last week with Trump and Senate Majority Leader John Thune, would need to sell fiscal hawks on it. But several, like Texas Representative Chip Roy, have signaled they’d go along with it, in exchange for another trillion dollars in spending cuts. 

That could lift the $10,000 cap on the state and local tax deduction and end the estate tax, while stopping taxes on tips, overtime and Social Security benefits. Trump may even be able to convince Congress to go along with $5,000 stimulus checks he has floated.

North Dakota Senator John Hoeven said Trump is the most powerful president he has seen on budget matters.

“This is his second time around. He’s got the experience,” Hoeven said, pointing to Trump’s own lobbying push to get the House budget plan passed. 

But it also plays into Democrats’ 2026 strategy, banking that cuts to Medicaid, food stamps, Pell Grants and other programs would be widely unpopular with voters, giving them an opportunity to take over congressional control. One Democratic political action committee, House Majority Forward PAC, is running ads in swing districts starting Monday on cuts to Medicaid, which insures nearly one-quarter of Americans. 

 “Today’s ad is just the beginning, and we will make sure every American knows exactly who is responsible,” Mike Smith, the PAC’s president, said in a statement.

Continue Reading

Accounting

Let a non-CPA do it!

Published

on

With accounting talent so hard to find, Wiss’ Paul Peterson shares how his firm has cultivated non-accountants and non-CPAs to fill the gap.

Continue Reading

Accounting

Senate Dems probe IRS chief nominee Billy Long’s campaign donations

Published

on

Billy Long speaking at a Donald Trump campaign event
Billy Long speaking at a Donald Trump campaign event

Al Drago/Bloomberg

The week before confirmation hearings for President Donald Trump’s nominee for commissioner of the Internal Revenue Service, former Missouri Congressman Billy Long, Democrats in the Senate are asking questions about the timing of campaign donations he received immediately after his nomination.

In a letter sent last Thursday to seven different companies — including an accounting firm, a tax advisory services firm, and a financial services provider — Democratic Senators Elizabeth Warren, D-Massachusetts, Ron Wyden, D-Oregon, and Sheldon Whitehouse, D-Rhode Island, questioned donations that the companies and some of their employees made to Long in the month and a half after his nomination in early December of 2024.

Between Dec. 4, 2024, and the end of January 2025, the letters said, Long’s unsuccessful 2022 campaign for Senate received $165,000 in donations — after nearly two years without receiving any — and his leadership PAC received an additional $45,000.

The donations allowed Long to repay himself the $130,000 balance of a $250,000 loan he had personally made to his campaign back in 2022.

(Read more:DOGE downsizing, IRS commissioner switch complicate tax season.“)

The senators’ letters described the donations as “a highly unusual and almost immediate windfall,” and characterized many of the donors as being “involved in an allegedly fraudulent tax credit scheme.”

“The overlap between potential targets of IRS investigations and the list of recent donors heightens the potential for conflicts of interest and suggests that contributors to Mr. Long’s campaign may be seeking his help to undermine or avoid IRS scrutiny,” the letters said; adding, “This brazen attempt to curry favor with Mr. Long is not only unethical — it may also be illegal.”

The senators then warned, “There appears to be no legitimate rationale for these contributions to a long-defunct campaign other than to purchase Mr. Long’s goodwill should he be confirmed as the IRS commissioner,” before appending a list of approximately a dozen questions for the donors to answer.

The donations were originally discovered in early April by investigative news outlet The Lever, which the senators noted in their letters.

After Long left Congress in 2023, he worked for a tax consulting firm, including promoting the COVID-related Employee Retention Credit. In early January, Sen. Warren sent a letter to Long questioning his tax credentials and promotion of the ERC.

The IRS has run is now on its fifth acting or regular commissioner since President Trump announced his intention to nominate Long; a number of the commissioners resigned or were removed over policy differences with the administration and its Department of Government Efficiency.

Long’s confirmation hearing before the Senate Finance Committee is scheduled for this Tuesday, May 20.

Continue Reading

Accounting

Trump berates Republicans to ‘Stop talking,’ pass tax cuts

Published

on

Donald Trump listens to a question while speaking to members of the media before boarding Marine One on the South Lawn of the White House in Washington, D.C.
Donald Trump

Al Drago/Bloomberg

President Donald Trump called on members of his party to unite behind his economic agenda in Congress, putting pressure on factions of lawmakers who are calling for last-minute changes to the legislation to drop their demands.

“We don’t need ‘GRANDSTANDERS’ in the Republican Party,” Trump said in a social media post on Friday. “STOP TALKING, AND GET IT DONE! It is time to fix the MESS that Biden and the Democrats gave us. Thank you for your attention to this matter!”

Trump sent the post from Air Force One after departing the Middle East as the House Budget Committee was meeting to approve the legislation, one of the final steps before the bill can move to the House floor for a vote.

House Speaker Mike Johnson has set a goal to pass the bill next week before the House recesses for its Memorial Day break.

However, the the bill failed the initial committee vote — typically a routine, procedural step — with members of the party still sparring over the scope of the cuts to Medicaid benefits and how much to raise the limit on the state and local tax deduction.

Narrow majorities in the House mean that a small group of Republicans can block the bill. Factions pushing for steeper Medicaid cuts and for an increase to the SALT write-off have both threatened to defeat the bill unless their demands are met.

“No one group gets to decide all this stuff in either direction,” Representative Chip Roy, an ultraconservative Texas Republican advocating for bigger spending cuts, said in a brief interview on Friday. “There are key issues that we think have this budget falling short.”

Trump’s social media muscle and calls to lawmakers have previously been crucial to advancing his priorities and come as competing constituencies have threatened to tank the measure.

But shortly after Trump’s Friday post, Roy and fellow hardliner Ralph Norman of South Carolina appeared unmoved — at least for the moment. Both men urged continued negotiations and significant changes to the bill that could in turn jeopardize support among moderates.

“I’m a hard no until we get this ironed out,” Norman said. “I think we can. We’ve made progress but it just takes time”

Continue Reading

Trending