This week’s highlights include: beer taxes reaching up to 40.8% of retail prices across states, the Senate confirming former Congressman Billy Long as IRS Commissioner (53–44 vote), and continued pushback from CPA societies on eliminating PTET SALT deductions for service-based businesses. Inflation held steady at 2.4% in May, with tariffs not yet affecting prices but raising concerns about future vehicle costs. We also look at the proposed Section 25F education credit, which offers 100% tax credits for donations to scholarship funds, sparking debate over whether donations could become more lucrative than asset sales.
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Congress: Don’t Make It More Profitable to Donate Than to Sell
Lawrence A. Zelenak for Tax Notes
In the draft of “The One Big, Beautiful Bill,” released by House Ways and Means Committee Chair Jason Smith, R-Mo., on May 12, and marked up by Ways and Means without any changes on May 14, there lurks new section 25F, providing for a nonrefundable 100 percent credit for “qualified contributions of cash or marketable securities” to an organization granting scholarships covering “qualified elementary or secondary education expenses.” The only limitations on students eligible for scholarships from organizations receiving credit-generating donations are that a student’s household income may not exceed 300 percent of the area median income and that the student must be eligible to enroll in a public elementary or secondary school. For any donating taxpayer, the credit is limited to the greater of 10 percent of the taxpayer’s adjusted gross income or $5,000. If enacted as proposed, the credit would be available in 2026 through 2029, subject to an annual national volume cap of $5 billion.
Kiplinger Inflation Outlook: Tariffs Not Yet Affecting Inflation
David Payne for Kiplinger
Headline inflation remained moderate in May at 2.4%. Core inflation (prices excluding food and energy) stayed at 2.8% for the third month. Cost increases in non-energy services slowed slightly to 0.2% as both housing and healthcare price increases moderated. Also helping out was a 1.0% decline in energy costs, and modest dips in new and used vehicle prices. This is unlikely to continue, however, due to tariffs on car imports. The price of groceries rose modestly, on average, helped by a continued decline in egg prices (down 2.7%). The avian flu had severely reduced flocks at egg-laying chicken farms, but farmers may have turned a corner. Prices are still 41.5% higher than a year ago, however. The cost of dining out continued to rise at a moderate pace.
What Some State CPA Leaders Are Saying About PTET SALT Deduction
Kevin Brewer for the Journal of Accountancy
Some state CPA society leaders are continuing to speak out against the proposal to eliminate the state and local tax deduction for service-based passthrough entities, which they say would be detrimental to accountants. The House-approved budget bill, H.R. 1, known as the One Big Beautiful Bill Act, which the Senate is considering, includes a limitation of the passthrough entity tax/state and local tax (PTET SALT) deduction for specified service trades or businesses (SSTBs), including accounting firms.
Senate Confirms Billy Long as IRS Commissioner
From Staff Reports from The Tax Advisor
The Senate on Thursday voted to confirm Billy Long, a former Missouri congressman, as IRS commissioner. Long’s term will run through Nov. 12, 2027. The vote was 53 in favor, 44 opposed. Long’s confirmation comes amid a time of upheaval for the IRS, which has cut thousands of employees this year and had five commissioners, permanent or acting since President Donald Trump took office. Danny Werfel resigned on Jan. 20, and four acting commissioners have since served: Doug O’Donnell, Melanie Krause, Gary Shapley, and Michael Faulkender.
Beer Taxes by State, 2025
By , for Tax Foundation
Particularly as we head into the summer months, many Americans enjoy a cold beer at the end of a long day. However, beer taxes might dampen the vibe. In the United States, taxes are the single most expensive ingredient in beer. The tax burden accounts for more of the final price of beer than labor and materials combined—the many different layers of applicable taxes combining to total as much as 40.8 percent of the retail price. The United States levies a federal excise tax on beer that ranges from $0.113 per gallon for the first 60,000 barrels produced by small domestic brewers to $0.581 per gallon for imports. Each of the 50 states and the District of Columbia also levy their own excise taxes on beer, in addition to any applicable state and local sales taxes.
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