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Trump plans to dismantle Biden’s climate law. It won’t be easy

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President-elect Donald Trump will be empowered by Republican gains on Capitol Hill to pull back portions of the Democrats’ signature climate law he calls “the green new scam,” which devoted hundreds of billions of dollars to subsidizing emission-free energy.

Just don’t expect a wholesale repeal of the Inflation Reduction Act.

“We are not looking at immediate, drastic, apocalyptic changes overnight,” said James Lucier, managing director at research group Capital Alpha Partners. “But there is always a strong likelihood that some parts of the IRA are going to be capped or phased out.” 

Donald Trump during an election night event in West Palm Beach, Florida
Donald Trump during an election night event in West Palm Beach, Florida

Win McNamee/Photographer: Win McNamee/Getty

The IRA fused climate policy with industrial policy, subsidizing electric vehicle, battery and solar manufacturing and other enterprises that will help the U.S. decarbonize. Trump’s return will put the resiliency of this approach to the test. 

The law is driving a wave of investment in red districts. Some GOP lawmakers, loath to give that up, have already said they don’t support making significant changes to the law. And although no Republicans voted for the measure two years ago, some of its incentives, such as credits for producing hydrogen and capturing carbon dioxide, are very popular with oil companies and other core GOP constituencies.

Gina McCarthy, a former White House climate adviser and managing co-chair of the climate coalition America Is All In, called any attempt to roll back the IRA “a fool’s agenda.” 

“Republican members of Congress have been joining hundreds of business leaders at ribbon cuttings and groundbreaking ceremonies” for IRA-supported projects, McCarthy said. (America Is All In is supported by Bloomberg Philanthropies, the philanthropic organization of Michael Bloomberg, the founder and majority owner of Bloomberg News parent Bloomberg LP.)

But Trump’s presidency is almost certain to usher in new restrictions, expiration dates and caps that narrow its scope. That could help offset the costs of extending Trump’s 2017 tax cuts before they expire next year, a top priority of the president-elect and other Republicans. 

The IRA “is the doomsday machine for the budget,” Scott Bessent, a top Trump economic adviser and potential Treasury Secretary pick, who serves as chief executive at the hedge fund Key Square Group, told CNBC. “I think the priority is going to be turning off the IRA.”

ClearView Energy Partners said in a note Thursday that top targets for elimination in the law include credits for used and commercial EVs; a fee on methane emissions levied on oil and gas producers; and billions of dollars in authority given to an Energy Department loan program. A clawback of unused funds for federal climate programs is possible, as is “an attempt to claw back obligated-but-undistributed balances,” the Washington-based consulting firm said.

The success of such efforts is likely contingent on the size of the expected Republican majority in the House. While many races have yet to be called, Republicans appear on track to hold at least a slim majority. They would likely need a much larger one to make major cuts to the law. 

Changes could happen administratively, too. Even without action from Congress, IRA opponents say, the Treasury Department could tighten rules around who can claim tax credits. For instance, strict rules on the sourcing of materials from China and other foreign adversaries, put in place for electric vehicle tax credits, could be applied more broadly to other incentives, such as the advanced manufacturing credit for solar panels and other clean-energy technologies. 

A policy that allows leased electric vehicles to evade those requirements, derided by critics as the “leasing loophole,” is almost certainly done for, analysts say. 

Other rules requiring the use of domestically sourced contents will likely be made more stringent, while bonus credits, such as those for projects built in “energy communities,” could be narrowed. 

Taking a scalpel — not a sledgehammer — to the IRA would still generate revenue to help pay for a tax cut extension. Some lawmakers have already advanced plans to bar companies tied to China and other so-called “foreign entities of concern” from collecting tax credits under the law. That would scale back the expected payouts and align with Republican interests in separating U.S. supply chains from China.

A Republican Congress is also likely to phase out a pair of technology-neutral clean electricity generation credits that go into effect next year. Those credits alone, expected to benefit utility-scale solar and onshore wind, could be a ripe target for lawmakers looking for budget cuts, since they aren’t set to end until the later part of 2032 or until carbon dioxide emissions from the U.S. electricity sector decline to at least 75% below 2022 levels. Some analysts have predicted that won’t happen for another 30 to 40 years. 

“We are talking decades, and definitely trillions of dollars,” said Ryan Sweezey, a director at energy research firm Wood Mackenzie Ltd.

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

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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.

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

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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”

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97% say CPA firms not using tech efficiently says survey

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While CPA firms far and wide have made major technology investments over the years, the vast majority of accountants say they’re not being used to their full potential. 

This finding comes from a recent survey undertaken by CPA.com and payment solutions provider Bill. The 400-person poll found that nearly all respondents, 97%, say they use technology inefficiently and that additional training is needed to maximize return on investment. Further illustrating the point, 43% of respondents said that technology is making them do more manual work, not less, something. Becky Munson, an Eisner Amper partner specializing in outsourced accounting services, believes this reflects a failure of training and change management, as she has seen many who disliked a technology change develop manual workarounds specifically to avoid using the new solutions. 

“We see employees make workarounds with tech stacks, which makes headaches that I think align with this 43%. We train people on new things, we ask them to use them, and they keep doing what they were doing before and only use the technology as much as they have to [in order to] move things along while you have people well trained on the software keeping up,” she said in a webcast on Thursday about the survey. 

Inefficient

Ariege Misherghi—senior vice president and general manager of accounts payable, accounts receivable and the accountant channel—said the issue isn’t just because of firms but also vendors that don’t provide enough support, and may not necessarily understand the profession in the first place. 

“Too often I think tools aren’t fully aligned with the workflows they’re meant to support. In SaaS they talk about product-market fit, but in this profession it’s not just that but also product-firm fit, and maybe product-profession fit. Not every tool marketed to accountants was built by people who truly understand how this profession works: the rhythms, the regulations, the stakes, the relationships, all of that. And even the greatest tools can fall short if they’re not implemented with a deep understanding of how firms really operate,” she said. 

And sometimes the inefficiencies come from both sides at once: the survey found that only 37% of firms require clients to use their tech stack, something that Munson said “breaks my heart” as “it is so low.” A streamlined, established tech stack is needed to achieve true economies of scale, but to get there firms need to standardize their data, and to do that firms need to make sure their clients’ data is also standardized, which usually means integrated tech stacks. 

“If you have all these different clients with all these different technologies, even if your own tech stack is standardized the systems they use is different, so the kind of data you will get will be different, and the work you need to do to make it work with your data is different, and your team spends a lot of time spinning their wheels,” she said. “Once you get standardized, where everything back and forth from clients is the same, you get to see how well the teams can do their work.” 

One source of inefficiencies is a rushed implementation. Munson said that, too many times, firms are so eager to get a solution working that they don’t pay attention to all its capacities, just the ones they need right now, but once the basics are down firms still don’t circle back on the rest of the features and how they can be used to drive efficiency. 

“Most of us have been through an implementation, either in the practice or with a client, where you’re just like ‘anything to get it working. Forget about all the fancy things it does. We just needed to do the basics right,’ and then we never circle back on those better, more efficient processes. We get to sort of minimal viable, and then we forget to come back and give it an extra polish. And so what we see there is the processes get written for that basic piece, and we never update,” she said. 

But this is part of what both speakers believed was the larger problem of firms getting lost in the details of their tech stacks and not taking a broader, more holistic approach, which would enable more efficiencies. The key component to managing technology effectively, Munson said, is looking not at individual solutions here and there but thinking of the system as a whole. 

“Often, what happens is something’s wrong or something is troublesome in some way. And so [we say] what can we do to fix that one thing? And we don’t think about it holistically and get all the right folks in there so that we’re solving for the right pain points,” she said. 

Misherghi agreed, and added that this holistic extends not only to the technology a firm already has but the solutions they plan to purchase in the future. When evaluating what technology they need, she said leaders need to think not in terms of specific point solutions to particular problems but things that can support the entire workflow—plus, the onboarding, training and ongoing support from the vendor. 

“Don’t just look for features, right? Look for solutions that support your workflows from providers that understand you. For firms, onboarding and training and optimization can’t be an afterthought. They’re essential to realizing value. I think this is where vendor partnerships matter. Firms seeking the strongest results aren’t just using software, they’re collaborating with their providers, they’re staying educated, they’re making sure their tools evolve alongside their needs. The best outcomes happen when your technology partner acts like part of your team, not just part of your toolkit,” she said. 

Misherghi said that the more successful firms she’s seen think less in terms of performing particular tasks but designing an entire system that, through automation, can do those tasks for them. It is less about plugging holes and more about developing a full infrastructure. The survey found that 74% of participants have a detailed plan to add new services in the next 12 month; Misherghi noted that, among these firms, 86% have a detailed technology roadmap, which is “a wonderful mark on the evolution of the profession we’re seeing.” 

She said a good tech roadmap is more like a service design blueprint versus a shopping list. Successful firms, she said, are not just chasing features but designing intentional workflows and systems capable of scalable service delivery. Similarly, she stressed that the provider should be more than just a vendor but a strategic co-architect that can help with growing pains. 

Misherghi said this approach will become especially relevant as AI becomes more common, as integrations will be key to their effective use, which means thinking in terms of the whole system to understand where those integrations should take place. Right now, she said, people think of AI in terms of analyzing data or extracting fields, but with the rise of AI agents will require firms to focus more on coordinating between them. 

“I think the next big leap is when those systems don’t just talk to each other, they act on each other’s behalf. I think the next big inflection point will be moving from automated steps to autonomous workflows, where AI agents aren’t just analyzing data or extracting fields but actually orchestrating tasks across tools based on firm policies and context and that will change the role of the accounting profession: its less time doing the work and more time designing the system for how everything works together. So the firms that will be thriving are those who are building strong infrastructure now because that is what AI needs to deliver on its core value,” she said.

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