While Congress nears the end of its August recess with a government funding deadline looming, Treasury and IRS tax policy developments have continued to roll in during a typically – if not often hopefully – quiet month in Washington. The IRS, amidst ongoing leadership shake-ups, has issued several noteworthy updates in August, namely urgent guidance released on Aug. 28, 2025, Rev. Proc. 2025-28, which sheds much-needed light for taxpayers on various elections, amended returns, and accounting method changes for research or experimental expenditures as provided under section 70302 of the sweeping tax and spending legislation enacted on July 4, 2025, known as the One Big Beautiful Bill Act (OBBBA) (P.L. 119-21).
Congress returns
Both chambers of Congress are slated to return to Washington next week on Sept. 2, 2025, as lawmakers prepare to race against the clock to avert a government shutdown at midnight on Sept. 30, 2025. With fiscal year 2026 beginning Oct. 1, 2025, Congress has less than 20 legislative days to reach bipartisan, bicameral agreement on 12 annual appropriations bills known as an “omnibus” or otherwise pass a “stopgap” continuing resolution (CR) to keep the lights on. It is also possible a CR could accompany some of the appropriations bills, if passed, known as a “minibus” to avoid a partial government shutdown. At this time, the Senate has passed three appropriations bills, and the House has passed two, all of which must be unified by amendment or reconciled in conference committee before reaching the president’s desk for signature or veto.
Looking ahead, some Republican lawmakers are already vocal about wanting a second bite of the apple with OBBBA follow-up reconciliation legislation in fiscal 2026, which could contain certain policy proposals that didn’t make it over the finish line last round as well as technical corrections. Additionally, it remains to be seen whether there will be an appetite for a bipartisan tax extenders bill. For more on lawmakers’ tax-related priorities that may gain traction in the fall, see our July 2025 Policy Pulse.
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