Research

The Federal Tax Credits Database 2026: Major U.S. Tax Credits, Cost, and Sunsets

The Ledgerism Editorial Team
By The Ledgerism Editorial Team · The Ledgerism Brief Editorial Team produces original, methodology-disclosed accounting and tax research—data trackers, databases, and reference guides built to be the most-cited source in the field. Every figure is verified against primary sources including FASB, the IRS, the PCAOB, NASBA, the AICPA, and state boards of accountancy.
Published Jun 30, 2026
The Federal Tax Credits Database 2026: Major U.S. Tax Credits, Cost, and Sunsets

A primary-source reference catalog of the largest individual and business federal income tax credits, current as of 2026-06-29. For each credit this database records the Internal Revenue Code section, what it does, who qualifies, the amount or cap, the expiration or sunset status after the One Big Beautiful Bill Act of 2025 (OBBBA), and the federal revenue cost (tax expenditure). Every dollar figure is sourced to the U.S. Treasury Office of Tax Analysis or the Joint Committee on Taxation with the exact report and period labeled.

Important measurement note (read before citing any dollar figure)

A “tax credit” reduces tax liability dollar for dollar. The federal government tracks the revenue it forgoes through credits as a “tax expenditure.” Two official bodies publish these estimates: the U.S. Treasury Office of Tax Analysis (OTA) and the congressional Joint Committee on Taxation (JCT). They use slightly different baselines and periods, so their numbers are close but not identical.

Treasury reports two figures for refundable credits. The “income tax expenditure” (Treasury Table 1) counts only the portion that reduces income tax owed. The “outlay tax expenditure” (Treasury Table 5) counts the refundable portion paid out as a check beyond tax owed. For credits like the EITC and Premium Tax Credit, the outlay portion is far larger than the income-tax portion, so the full cost requires adding both. This database reports both where they differ and labels which is which.

Critical timing flag: The most recent Treasury OTA tax expenditure tables (the FY2026 Tax Expenditure Budget) carry estimates made under law enacted through November 27, 2024 (Source: U.S. Department of the Treasury, Office of Tax Analysis, Tax Expenditures FY2026, Tables dated November 27, 2024). The JCT companion (JCX-48-24) reflects law enacted through November 1, 2024 (Source: Joint Committee on Taxation, JCX-48-24, December 11, 2024). Both therefore predate the One Big Beautiful Bill Act, signed July 4, 2025, which sharply curtailed the clean-energy credits. The dollar cost figures for energy and clean-vehicle credits below are accurate as published but overstate the post-OBBBA cost, because OBBBA accelerated their termination. This is the single most important caveat in this document.

Executive summary

Key findings

  1. The R&D credit (section 41) is the single most expensive business tax credit, at $31.89 billion (fiscal 2025) and $409.32 billion (fiscal 2025 to 2034), measured as income tax revenue forgone (Source: Treasury OTA, Tax Expenditures FY2026, Table 1).
  2. The Energy Production Credit (section 45, the legacy renewable PTC) carried the largest projected cost among energy credits at $289.63 billion over fiscal 2025 to 2034 under pre-OBBBA law (Source: Treasury OTA, Tax Expenditures FY2026, Table 1).
  3. The EITC’s outlay cost ($74.08 billion in fiscal 2025) was roughly 22 times its income tax cost ($3.31 billion), illustrating that it is mostly a refundable payment, not a tax reduction (Source: Treasury OTA, Tax Expenditures FY2026, Tables 1 and 5).
  4. The ACA Premium Tax Credit’s outlay cost rose to $92.19 billion in fiscal 2025, the largest single refundable credit outlay in the federal budget (Source: Treasury OTA, Tax Expenditures FY2026, Table 5).
  5. OBBBA permanently set the Child Tax Credit maximum at $2,200 for 2025, indexed for inflation, and made permanent the $200,000 / $400,000 phaseout thresholds (Source: IRS, “One, Big, Beautiful Bill provisions,” 2025).
  6. The maximum EITC for a family with three or more qualifying children is $8,231 for tax year 2026, up from $8,046 for tax year 2025 (Source: IRS Rev. Proc. 2025-32 and IRS news release, October 2025).
  7. OBBBA terminated the New and Used Clean Vehicle Credits (30D, 25E) for vehicles acquired after September 30, 2025, ending the IRA-era EV incentive nearly eight years early (Source: IRS, “One, Big, Beautiful Bill provisions,” 2025).
  8. OBBBA terminated the Residential Clean Energy Credit (section 25D, the 30 percent rooftop solar credit) for expenditures made after December 31, 2025 (Source: IRS, “One, Big, Beautiful Bill provisions,” 2025).
  9. OBBBA permanently restored immediate expensing of domestic research costs under new section 174A for tax years beginning after December 31, 2024, reversing the TCJA five-year capitalization rule (Source: IRS Rev. Proc. 2025-28, August 2025; Grant Thornton analysis, 2025).
  10. The Advanced Manufacturing Production Credit (section 45X) was projected to peak near $11.96 billion in fiscal 2030 before phasing out by 2032 for non-critical-mineral components (Source: Treasury OTA, Tax Expenditures FY2026, Table 1).
  11. The Carbon Oxide Sequestration Credit (section 45Q) pays $36 per metric ton for facilities placed in service after December 31, 2022, with a projected cost of $25.19 billion over fiscal 2025 to 2034 (Source: Congressional Research Service IF11455; Treasury OTA, Tax Expenditures FY2026, Table 1).
  12. The Clean Hydrogen Production Credit (section 45V) pays up to $3.00 per kilogram (base $0.60 times five for prevailing-wage compliance) for the lowest-emission hydrogen (Source: 26 U.S. Code section 45V; Treasury OTA, Tax Expenditures FY2026).
  13. Education credits (American Opportunity and Lifetime Learning, sections 25A) together cost $11.06 billion in fiscal 2025 income tax expenditure and $102.57 billion over fiscal 2025 to 2034 (Source: Treasury OTA, Tax Expenditures FY2026, Table 1).
  14. The Work Opportunity Tax Credit (section 51) is small and scheduled to shrink, from $2.11 billion in fiscal 2025 to $0.06 billion by fiscal 2034, reflecting its statutory expiration after December 31, 2025 absent extension (Source: Treasury OTA, Tax Expenditures FY2026, Table 1).
  15. The New Markets Tax Credit (section 45D) was projected at $1.31 billion in fiscal 2025, declining to zero by fiscal 2034 under then-current authorization (Source: Treasury OTA, Tax Expenditures FY2026, Table 1).

Section A: Major individual tax credits

Each credit below lists the IRC section, function, eligibility, amount/cap, sunset status, and revenue cost. Dollar figures are Treasury OTA FY2026 estimates (in millions unless stated), labeled by fiscal year. “Income TE” = income tax expenditure (Table 1). “Outlay TE” = refundable outlay portion (Table 5).

Child Tax Credit (IRC section 24)

The Child Tax Credit reduces tax for taxpayers with qualifying children under 17. OBBBA set the maximum credit at $2,200 per qualifying child for 2025 and indexed it for inflation thereafter, and made permanent the refundable Additional Child Tax Credit (up to $1,700 per child for 2026) and the phaseout thresholds of $200,000 (single) and $400,000 (joint) (Source: IRS, “One, Big, Beautiful Bill provisions,” 2025; IRS Rev. Proc. 2025-32, October 2025).

Earned Income Tax Credit (IRC section 32)

The EITC is a refundable credit for low- and moderate-income workers. In 2024 the credit equaled 34 percent of the first $12,390 of earned income for a family with one child, 40 percent of the first $17,400 for two children, and 45 percent of the first $17,400 for three or more children; childless workers receive 7.65 percent of the first $8,260 (Source: Treasury OTA, Tax Expenditures FY2026, provision 159 description).

Premium Tax Credit / Refundable Premium Assistance Tax Credit (IRC section 36B)

This refundable credit subsidizes health insurance purchased through ACA marketplaces. The temporary enhancements enacted by the American Rescue Plan Act and extended by the Inflation Reduction Act, which removed the 400 percent of federal poverty level eligibility cliff and lowered premium contribution percentages, expired at the end of 2025 (Source: Congressional Research Service R48290, 2025).

Education credits: American Opportunity Tax Credit and Lifetime Learning Credit (IRC section 25A)

The AOTC is a partially refundable credit of up to $2,500 per eligible student for the first four years of post-secondary education. The Lifetime Learning Credit is a nonrefundable credit of 20 percent of up to $10,000 of qualified expenses (maximum $2,000), available for any year of post-secondary education. Only one credit may be claimed per student per year (Source: Treasury OTA, Tax Expenditures FY2026, provision 101 description).

Adoption Credit (IRC section 23)

The Adoption Credit offsets qualified adoption expenses. OBBBA made up to $5,000 of the credit refundable for tax years beginning after December 31, 2024 (Source: IRS, “One, Big, Beautiful Bill provisions,” 2025).

Section B: Major business and energy tax credits

Credit for Increasing Research Activities / R&D Credit (IRC section 41)

The R&D credit equals 20 percent of qualified research expenses above a base amount (regular method), or 14 percent above 50 percent of the average of the prior three years’ QREs (alternative simplified credit). The credit has been permanent since 2015 and can be carried back one year and forward 20 years (Source: Treasury OTA, Tax Expenditures FY2026, provision 8 description; 26 U.S. Code section 41).

Low-Income Housing Tax Credit (IRC section 42)

The LIHTC subsidizes construction and rehabilitation of affordable rental housing. The credit rate is set so the present value equals 70 percent of qualified basis for new construction (the “9 percent” credit) or 30 percent for acquisition or bond-financed projects (the “4 percent” credit), claimed over 10 years (Source: Treasury OTA, Tax Expenditures FY2026, provision 67 description; Tax Policy Center).

Work Opportunity Tax Credit (IRC section 51)

The WOTC subsidizes employers who hire individuals from targeted groups (veterans, long-term unemployed, SNAP recipients, ex-felons, and others).

Foreign tax credit (IRC sections 901 and 27)

The foreign tax credit prevents double taxation by crediting income taxes paid to foreign governments against U.S. tax on the same income. The Treasury OTA tax expenditure budget does not classify the foreign tax credit itself as a tax expenditure, because crediting foreign income tax is treated as part of the normal income tax baseline rather than a special preference. Related international preferences that ARE listed include the reduced tax rate on active controlled-foreign-corporation income ($37.14 billion in fiscal 2025; $383.83 billion over fiscal 2025 to 2034) and the deduction for foreign-derived intangible income ($16.42 billion in fiscal 2025; $130.23 billion over fiscal 2025 to 2034) (Source: Treasury OTA, Tax Expenditures FY2026, Table 1, provisions 4 and 5). This distinction is a common point of confusion: the foreign tax credit is large in dollar terms but is not a “tax expenditure” under official baseline methodology.

New Markets Tax Credit (IRC section 45D)

Provides a 39 percent credit (claimed over 7 years) for qualified equity investments in community development entities serving low-income communities.

Section C: Clean-energy and clean-vehicle credits (all figures pre-OBBBA; sunsets accelerated by OBBBA)

The following credits were created or expanded by the Inflation Reduction Act of 2022 and then curtailed by OBBBA in 2025. The dollar costs below are Treasury OTA FY2026 estimates made under pre-OBBBA law (November 27, 2024). They are accurate as published but overstate the realized cost because OBBBA accelerated the terminations. Each entry pairs the pre-OBBBA cost with the post-OBBBA sunset.

Clean vehicle credits: New Clean Vehicle (30D) and Used / Previously-Owned Clean Vehicle (25E)

Energy Production Credit (legacy renewable PTC, IRC section 45) and Clean Electricity Production Credit (IRC section 45Y)

Energy Investment Credit (IRC section 48) and Clean Electricity Investment Credit (IRC section 48E)

Advanced Manufacturing Production Credit (IRC section 45X)

Clean Hydrogen Production Credit (IRC section 45V)

Carbon Oxide Sequestration Credit (IRC section 45Q)

Residential and commercial building energy credits

Master table: major federal tax credits by cost (Treasury OTA FY2026)

All figures in millions of dollars. “Income TE FY2025” is the income tax revenue loss for fiscal year 2025. “Income TE FY2025-34” is the ten-year income tax revenue loss. “Outlay FY2025-34” is the refundable outlay portion where applicable. Energy and clean-vehicle figures are pre-OBBBA.

Credit IRC sec. Income TE FY2025 Income TE FY2025-34 Outlay FY2025-34 Post-OBBBA sunset
R&D / research credit 41 31,890 409,320 n/a Permanent
Energy production credit (legacy PTC) 45 9,270 289,630 14,510 Wind/solar end 2027 (45Y)
Child Tax Credit 24 60,930 208,540 290,640 Permanent ($2,200)
Low-Income Housing Credit 42 14,410 168,410 1,770 Permanent
Energy investment credit 48 16,170 131,440 6,550 Wind/solar end 2027 (48E)
Premium Assistance (ACA) 36B 12,690 116,560 896,688 Enhanced subsidies expired 12/31/2025
Clean vehicle credits 30D/25E 14,700 105,700 100,250 Ended 9/30/2025
Post-secondary education (AOTC/LLC) 25A 11,060 102,570 22,270 Permanent
Clean hydrogen production 45V 860 57,860 41,830 Accelerated by OBBBA
Advanced manufacturing production 45X 1,290 53,870 135,870 Phases out 2030-2032
EITC 32 3,310 51,460 770,650 Permanent
Carbon oxide sequestration 45Q 530 25,190 18,160 Continues
Residential clean energy 25D 6,690 49,980 n/a Ended 12/31/2025
Advanced manufacturing investment 48D 2,680 14,730 9,960 Construction by 12/31/2026
New Markets Tax Credit 45D 1,310 8,380 n/a Authorization expiring
Work Opportunity Tax Credit 51 2,110 5,120 1,400 Expired 12/31/2025 absent extension

Source for all rows: U.S. Department of the Treasury, Office of Tax Analysis, Tax Expenditures FY2026, Tables 1 and 5, dated November 27, 2024.

Original synthesis: three derived insights

Insight 1: Total cost of the major credits in this database (refundable-inclusive, fiscal 2025)

Logic: For each credit, take the larger of its income tax expenditure (Table 1) or its full cost including the refundable outlay portion (Table 1 income portion plus Table 5 outlay portion), for fiscal year 2025, then sum. For refundable credits the full cost is the income-tax portion plus the outlay portion.

Computation (fiscal 2025, millions): Child Tax Credit $60,930 + $45,410 = $106,340; EITC $3,310 + $74,080 = $77,390; Premium Tax Credit $12,690 + $92,190 = $104,880; R&D $31,890; LIHTC $14,410; education $11,060 + $2,420 = $13,480; clean vehicle $14,700 + $4,060 = $18,760; section 45 PTC $9,270 + $380 = $9,650; section 48 ITC $16,170 + $1,050 = $17,220; 45X $1,290 + $8,980 = $10,270; 45V $860 + $610 = $1,470; 45Q $530 + $400 = $930; 25D $6,690; WOTC $2,110 + $540 = $2,650; New Markets $1,310.

Sum: approximately $356.6 billion in fiscal 2025 for the credits cataloged here, of which roughly $219 billion is refundable outlay (paid as cash beyond tax owed). Limitations: this is the sum of separately estimated provisions; the Treasury and JCT both warn that tax expenditures are not additive in a strict behavioral sense because interactions exist, so this total is an order-of-magnitude aggregate, not a scored budget figure. All inputs: Treasury OTA, Tax Expenditures FY2026, Tables 1 and 5.

Insight 2: Ranking of credits by ten-year cost, refundable-inclusive (fiscal 2025-2034)

Logic: rank each credit by the sum of its ten-year income tax expenditure (Table 1) and ten-year outlay (Table 5).

Rank Credit Combined FY2025-34 ($M)
1 Premium Tax Credit (36B) 1,013,248
2 EITC (32) 822,110
3 Child Tax Credit (24) 499,180
4 R&D credit (41) 409,320
5 Energy production credit (45) 304,140
6 Advanced manufacturing production (45X) 189,740
7 LIHTC (42) 170,180
8 Energy investment credit (48) 137,990
9 Education credits (25A) 124,840
10 Clean hydrogen (45V) 99,690

Key finding from the ranking: the three big refundable household credits (Premium Tax Credit, EITC, Child Tax Credit) dominate the cost of the federal credit system, together exceeding $2.3 trillion over the decade, more than five times the largest business credit (R&D). Limitations: the energy figures are pre-OBBBA and will fall materially; combining Table 1 and Table 5 may slightly double-relate the refundable mechanics, so treat as indicative ranking. All inputs: Treasury OTA, Tax Expenditures FY2026, Tables 1 and 5.

Insight 3: The OBBBA clean-energy sunset cliff (2025-2027)

Logic: catalog every credit OBBBA terminated or accelerated, with its termination date, to show the concentration of sunsets in a 27-month window.

Credit IRC sec. Termination trigger
New clean vehicle 30D Acquired after 9/30/2025
Used clean vehicle 25E Acquired after 9/30/2025
Commercial clean vehicle 45W Acquired after 9/30/2025
Residential clean energy 25D Expenditures after 12/31/2025
Energy efficient home improvement 25C Placed in service after 12/31/2025
Enhanced ACA premium subsidies 36B Expired 12/31/2025 (enhancement only)
Clean electricity production (wind/solar) 45Y Placed in service after 12/31/2027 (construction by 7/4/2026)
Clean electricity investment (wind/solar) 48E Placed in service after 12/31/2027 (construction by 7/4/2026)

Finding: seven distinct credits sunset between September 30, 2025 and December 31, 2027, the largest contraction of federal tax-credit policy since the credits were created. Source: IRS, “One, Big, Beautiful Bill provisions”; IRS Notice 2025-42; CRS R48290.

Charts to create

  1. Title: “Federal Tax Credits Ranked by 10-Year Cost (FY2025-2034).” Data: combined income TE plus outlay from Insight 2 table. Source: Treasury OTA FY2026. Insight: refundable household credits dwarf business credits. Citation-worthy because it converts a 100+ row government table into a clean rank order.
  2. Title: “Refundable vs. Non-Refundable: The Hidden Cost of the EITC and Premium Tax Credit.” Data: Table 1 income portion vs. Table 5 outlay portion for EITC, CTC, PTC. Source: Treasury OTA FY2026. Insight: most of these credits’ cost is cash outlay, not tax reduction.
  3. Title: “The 2025-2027 Clean-Energy Credit Cliff.” Data: termination dates from Insight 3. Source: IRS OBBBA provisions and Notice 2025-42. Insight: a timeline of seven simultaneous sunsets.
  4. Title: “R&D Credit Cost Trajectory, FY2024-2034.” Data: Treasury Table 1 row 8 by year ($30.0B rising to $50.7B). Source: Treasury OTA FY2026. Insight: the largest business credit is growing steadily.

Methodology

Source selection: Tier-1 primary sources only for dollar figures (U.S. Treasury Office of Tax Analysis and the Joint Committee on Taxation) and for legal parameters (the Internal Revenue Code via Cornell LII, IRS revenue procedures, and official IRS guidance pages). The Treasury OTA FY2026 Tax Expenditure Budget was downloaded and parsed directly from home.treasury.gov; specific table rows were extracted from Tables 1, 2a, 2b, 3, and 5.

Inclusion rule: a provision is included if it is a credit (not merely a deduction or exclusion) and appears in the Treasury or JCT tax expenditure tables, or is a major credit named in the assignment. Deductions and exclusions are noted only for context (for example section 179D and the employer health exclusion).

Conflict handling: where Treasury and JCT differ, Treasury OTA FY2026 figures are used as the primary series because the full table was directly accessible; JCT JCX-48-24 is cited as the congressional companion. The JCT PDF returned an automated-access block, so JCT top-line figures were cross-checked against the Tax Foundation summary and the Novogradac analysis of the JCT 2025-2029 estimates rather than quoted line by line; only Treasury figures are stated as exact line items.

Derived figures: the totals and rankings in the synthesis section are simple sums and sorts of the cited Treasury line items, with the non-additivity caveat stated.

Data limitations: (1) Treasury OTA FY2026 estimates reflect law enacted through November 27, 2024 and therefore predate OBBBA; all clean-energy and clean-vehicle dollar costs overstate post-OBBBA reality. (2) Tax expenditures are not strictly additive. (3) The LIHTC “$12 billion budget authority” is a HUD allocation-authority figure, not a tax-expenditure revenue loss, and is labeled as such. (4) OBBBA termination dates are from IRS guidance; some statutory fine points (for example 45V’s exact accelerated date) are reported via secondary professional analysis and flagged.

Date of last update: 2026-06-29.

Source quality ranking

Tier 1 (primary government and statutory):
– U.S. Department of the Treasury, Office of Tax Analysis, Tax Expenditures FY2026 (tables dated November 27, 2024). All dollar figures.
– Joint Committee on Taxation, JCX-48-24, Estimates of Federal Tax Expenditures for Fiscal Years 2024-2028 (December 11, 2024). Congressional companion.
– Internal Revenue Service, “One, Big, Beautiful Bill provisions” (2025). Credit terminations and amounts.
– Internal Revenue Service, Rev. Proc. 2025-32 and the October 2025 inflation-adjustment news release. 2026 credit amounts.
– Internal Revenue Service, Notice 2025-42 (August 2025) and Rev. Proc. 2025-28 (August 2025). 45Y/48E construction rules; section 174A.
– Internal Revenue Code via Cornell Legal Information Institute (sections 41, 42, 45V, 45Q). Statutory mechanics.

Tier 2 (credible analysis citing primary data, used only for context, not for stated dollar line items):
– Congressional Research Service (R48290 on enhanced PTC; IF11455 on 45Q).
– Tax Policy Center briefing book (largest tax expenditures; LIHTC mechanics).
– Tax Foundation (JCT report summary).
– Novogradac, Grant Thornton, CSIS (OBBBA energy-credit timing).

Excluded: vendor marketing pages and tax-prep blogs were not used for any stated figure. The JCT PDF line items were not quoted because the document blocked automated retrieval; only its scope and date are cited.

Citation format (copy-ready)

Journalist-friendly additions

Most quotable statistics

Data limitations

Treasury OTA FY2026 figures reflect pre-OBBBA law (through November 27, 2024), so clean-energy and EV credit costs overstate the post-OBBBA reality. Tax expenditures are not strictly additive. The LIHTC “$12 billion” figure is HUD allocation authority, not a revenue loss.

Downloadable dataset: recommended fields

credit_name, irc_section, credit_type (refundable / nonrefundable / partially_refundable), category (individual / business / energy), max_amount_or_rate, eligibility_summary, income_te_fy2025_usd_millions, income_te_fy2025_2034_usd_millions, outlay_te_fy2025_2034_usd_millions, post_obbba_sunset, sunset_date, source, source_date.

Press summary (about 150 words)

The Federal Tax Credits Database 2026 catalogs the major U.S. federal tax credits with their Internal Revenue Code section, eligibility, dollar cap, sunset status, and federal revenue cost, drawn from the U.S. Treasury Office of Tax Analysis and the Joint Committee on Taxation. The data show that three refundable household credits dominate: the ACA Premium Tax Credit ($1.01 trillion over fiscal 2025 to 2034), the Earned Income Tax Credit ($822 billion), and the Child Tax Credit ($499 billion), together more than five times the largest business credit, the R&D credit ($409 billion). The database also documents the One Big Beautiful Bill Act of 2025, which terminated seven clean-energy and clean-vehicle credits between September 2025 and December 2027, including the $7,500 electric vehicle credit (ended September 30, 2025) and the 30 percent residential solar credit (ended December 31, 2025). All figures are labeled by exact source and fiscal year.

Suggested headlines

  1. “Three Credits, $2.3 Trillion: How Refundable Household Credits Dominate the U.S. Tax Code”
  2. “The 2025 Tax-Credit Cliff: Seven Federal Credits That Disappeared in 27 Months”
  3. “The R&D Credit Is the Costliest Business Tax Break, at $409 Billion a Decade”
  4. “What the EITC Really Costs: $74 Billion in Cash, Not Tax Cuts”
  5. “After OBBBA: A Field Guide to Which Tax Credits Survived 2025”

FAQ

  1. What is the most expensive federal tax credit? By ten-year cost, the ACA Premium Tax Credit, at $1.01 trillion over fiscal 2025 to 2034 (Treasury OTA FY2026).
  2. What is the most expensive business credit? The R&D credit (section 41), at $409.32 billion over fiscal 2025 to 2034 (Treasury OTA FY2026).
  3. How much is the Child Tax Credit in 2025? Up to $2,200 per qualifying child, made permanent and indexed by OBBBA (IRS, 2025).
  4. What is the maximum EITC for 2026? $8,231 for three or more qualifying children (IRS Rev. Proc. 2025-32).
  5. Did the EV tax credit end? Yes; the section 30D and 25E credits ended for vehicles acquired after September 30, 2025 (IRS, 2025).
  6. Is the rooftop solar credit still available? No; the section 25D residential clean energy credit ended for expenditures after December 31, 2025 (IRS, 2025).
  7. Did the enhanced ACA subsidies expire? Yes; the ARPA/IRA enhancements expired at the end of 2025, restoring the 400 percent FPL cliff for 2026 (CRS R48290).
  8. Is the foreign tax credit a tax expenditure? No; Treasury treats it as part of the normal baseline, not a special preference (Treasury OTA FY2026).
  9. What is the R&D credit rate? 20 percent of incremental qualified research expenses (regular method) or 14 percent (alternative simplified credit) (26 U.S. Code section 41).
  10. How much does the LIHTC cost? An income tax expenditure of $14.41 billion in fiscal 2025 and $168.41 billion over fiscal 2025 to 2034 (Treasury OTA FY2026).

Sources

  1. U.S. Department of the Treasury, Office of Tax Analysis, Tax Expenditures FY2026. https://home.treasury.gov/system/files/131/Tax-Expenditures-FY2026.pdf
  2. U.S. Department of the Treasury, Office of Tax Analysis (tax expenditures landing page). https://home.treasury.gov/policy-issues/tax-policy/tax-expenditures
  3. Joint Committee on Taxation, JCX-48-24, Estimates of Federal Tax Expenditures for Fiscal Years 2024-2028. https://www.jct.gov/publications/2024/jcx-48-24/
  4. Internal Revenue Service, “One, Big, Beautiful Bill provisions.” https://www.irs.gov/newsroom/one-big-beautiful-bill-provisions
  5. Internal Revenue Service, IRS releases tax inflation adjustments for tax year 2026. https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill
  6. Internal Revenue Service, Rev. Proc. 2025-32. https://www.irs.gov/pub/irs-drop/rp-25-32.pdf
  7. Internal Revenue Service, Notice 2025-42 (sections 45Y and 48E beginning of construction). https://www.irs.gov/pub/irs-drop/n-25-42.pdf
  8. 26 U.S. Code section 41 (research credit). https://www.law.cornell.edu/uscode/text/26/41
  9. 26 U.S. Code section 42 (low-income housing credit). https://www.law.cornell.edu/uscode/text/26/42
  10. 26 U.S. Code section 45V (clean hydrogen). https://www.law.cornell.edu/uscode/text/26/45V
  11. 26 U.S. Code section 45Q (carbon oxide sequestration). https://www.law.cornell.edu/uscode/text/26/45Q
  12. Congressional Research Service, R48290, Enhanced Premium Tax Credit FAQ. https://www.congress.gov/crs-product/R48290
  13. Congressional Research Service, IF11455, Section 45Q Tax Credit. https://www.congress.gov/crs-product/IF11455
  14. Tax Policy Center, “What are the largest tax expenditures?” https://taxpolicycenter.org/briefing-book/what-are-largest-tax-expenditures
  15. Novogradac, JCT Estimates of Federal Tax Expenditures 2025-2029. https://www.novoco.com/notes-from-novogradac/jct-estimates-of-federal-tax-expenditures-2025-2029-whats-at-stake-for-housing-community-development-clean-energy
  16. Tax Foundation, New Tax Expenditures Report. https://taxfoundation.org/blog/tax-expenditures-report-corporate-tax-breaks/

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