The $40,000 cap would begin this year, with the same $500,000 income phaseout, and both figures would rise by 1% annually from 2026 through 2033.

The U.S. Senate approved Donald Trump's tax cut and spending bill with a 51-50 vote, passed by the tie-breaking vote from Vice President JD Vance.

The version of the ‘big, beautiful’ spending bill that passed the Senate permanently extends Trump’s 2017 tax cuts.