What Builders Should Know About the One Big Beautiful Bill Act

NAHB AVP of Government Affairs J.P. Delmore recently sat down with Pro Builder Editorial Director Rich Binsacca to discuss the ins and outs of the One Big Beautiful Bill Act, and what it means for housing and home builders.

“The No. 1 item in this bill and what it does for builders — and for all business owners, frankly — is permanency,” Delmore explained. “We haven’t had a permanent tax code since 2017. We’ve been living under this threat of a tax cliff for next year. If this bill passes, almost everything in the tax code will become permanent features.”

The only permanent change in the 2017 Tax Cuts and Jobs Act (TCJA) was to decrease the corporate income tax rate to 21%. Many companies in the home-building industry are family-owned companies set up as pass-through businesses, with several provisions from the TCJA — such as the Section 199A Qualified Business Income Deduction and estate tax exemption — set to expire this year.

Homeownership Incentives

The TCJA also increased the standard deduction limit, which has affected the ability for many consumers to utilize the mortgage interest deduction.

“This is a policy challenge for us both now and in the future,” Delmore explained.

“NAHB believes that we should be looking at how we incentivize homeownership and making sure that the homeownership incentives in the tax code are directed towards the folks who are going to most benefit from it,” he added.

Controversial Tax Issues

One of the most controversial, unresolved issues is the state and local tax, or SALT, deductions. The One Big Beautiful Bill Act would increase the current limit of $10,000 to $40,000, with the Senate tax bill capping it at the existing $10,000.

“[This is] largely a reflection of the fact that the SALT issue is a geographic issue, not a partisan issue,” Delmore noted. “The states that tend to be affected the most [by SALT] are California, New York and New Jersey, and there are no Republican senators from those three states. The fact that there are Republican House members from those states gave them leverage on the House bill. They don’t have that leverage on the Senate. So how they navigate SALT is something we are really watching because it’s going to potentially make or break the ability of this bill to become law.”

Another is the energy tax credits. Both the House and Senate tax bills propose ending several energy tax credits used in the housing industry:

• Section 45L New Energy Efficient Home Tax Credit
• Section 25D Residential Clean Energy Credit
• Section 48E Clean Electricity Tax Credit

The difference is the length of the sunset period, which is longer in the Senate bill to allow businesses more time to plan for the change — or provide an “offramp” transition, as many members heard during their visits to Capitol Hill during the 2025 Legislative Conference.

“There are senators who recognize that businesses have made decisions based on tax credits that they expected to be around for many years to come and that giving businesses, in one case, 60 days’ notice that the credit was going to disappear is unfair,” Delmore stated. “That’s bad tax policy.”

Delmore also delves into some of the procedural challenges that may arise as part of the process.

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