Tax Forecast Transparency Act

119th CONGRESS 2d Session H.R. ___ To amend the Congressional Budget Act of 1974 and the Internal Revenue Code of 1986 to require the Congressional Budget Office and the Joint Committee on Taxation to prepare and publicly disclose household-level fiscal impact statements for legislation that would change Federal tax liability or reduce Federal benefit programs used to offset revenue changes, and for other purposes. _______________________________________________________ IN THE HOUSE OF REPRESENTATIVES Mr./Ms. [___] introduced the following bill; which was referred to the Committee on [Rules/Budget/Ways and Means] _______________________________________________________ A BILL To amend the Congressional Budget Act of 1974 and the Internal Revenue Code of 1986 to require the Congressional Budget Office and the Joint Committee on Taxation to prepare and publicly disclose household-level fiscal impact statements for legislation that would change Federal tax liability or reduce Federal benefit programs used to offset revenue changes, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE. This Act may be cited as the "Tax Forecast Transparency Act of 2026". SEC. 2. FINDINGS. Congress finds the following: (1) The Congressional Budget Act of 1974 (Public Law 93-344; 2 U.S.C. 601 et seq.) established the Congressional Budget Office to provide Congress with objective budgetary and economic analysis, yet current law does not require household-level distributional impact analyses of tax legislation to be prepared or made publicly available before a vote. (2) The Joint Committee on Taxation provides official revenue estimates for all tax legislation considered by Congress, but distributional analysis showing the effects of tax law changes across income groups is not a legally required task and is produced only upon request. (3) Tax legislation frequently contains provisions that phase in, phase out, sunset, or are triggered by economic conditions over multiple years, such that the impact on a household in the first year of enactment may differ substantially from the impact in subsequent years. (4) Tax reductions are frequently offset, in whole or in part, by reductions in Federal benefit programs, including but not limited to programs providing healthcare, nutrition assistance, education funding, and housing assistance, and the net fiscal effect of such combined changes on households at each income level may differ significantly from the effect of the tax change alone. (5) The people of the United States are entitled to know, before their elected representatives vote on legislation that changes their tax liability, the full and honest fiscal impact of such legislation on households at every income level, in every State, and over a meaningful time horizon. (6) Transparency in the legislative process is essential to democratic accountability, and Members of Congress cannot be held accountable for the fiscal consequences of their votes if those consequences are not clearly disclosed to the public in advance. SEC. 3. DEFINITIONS. In this Act: (1) COVERED LEGISLATION.--The term "covered legislation" means any bill, joint resolution, amendment, conference report, or amendment between the Houses that-- (A) would result in a change in Federal revenue (as estimated by the Joint Committee on Taxation or the Congressional Budget Office) of $1,000,000,000 or more over the 5-fiscal-year period beginning with the first fiscal year for which the legislation would be effective; or (B) would result in a change in Federal revenue of any amount and contains or is considered contemporaneously with legislation that would reduce direct spending for one or more covered Federal benefit programs. (2) COVERED FEDERAL BENEFIT PROGRAM.--The term "covered Federal benefit program" means any of the following: (A) The Medicare program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.). (B) The Medicaid program under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.). (C) The supplemental nutrition assistance program under the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.). (D) Premium tax credits and cost-sharing reductions under sections 36B and 1402 of the Patient Protection and Affordable Care Act (26 U.S.C. 36B; 42 U.S.C. 18071). (E) The supplemental security income program under title XVI of the Social Security Act (42 U.S.C. 1381 et seq.). (F) Federal Pell Grants under section 401 of the Higher Education Act of 1965 (20 U.S.C. 1070a). (G) The program of block grants for States for temporary assistance for needy families under part A of title IV of the Social Security Act (42 U.S.C. 601 et seq.). (H) The special supplemental nutrition program for women, infants, and children under section 17 of the Child Nutrition Act of 1966 (42 U.S.C. 1786). (I) Federal housing assistance programs under the United States Housing Act of 1937 (42 U.S.C. 1437 et seq.), including the program for tenant-based rental assistance under section 8 of such Act (42 U.S.C. 1437f). (J) The Children's Health Insurance Program under title XXI of the Social Security Act (42 U.S.C. 1397aa et seq.). (K) Any other Federal program providing direct benefits to individuals that the Director of the Congressional Budget Office, in consultation with the Chief of Staff of the Joint Committee on Taxation, determines to be appropriate for inclusion, based on the scope and nature of the covered legislation. (3) HOUSEHOLD IMPACT STATEMENT.--The term "Household Impact Statement" means the analysis required under section 4 of this Act. (4) INCOME CATEGORY.--The term "income category" means each of the following categories of expanded income (as defined by the Joint Committee on Taxation): (A) Less than $10,000. (B) $10,000 to $20,000. (C) $20,000 to $30,000. (D) $30,000 to $40,000. (E) $40,000 to $50,000. (F) $50,000 to $75,000. (G) $75,000 to $100,000. (H) $100,000 to $200,000. (I) $200,000 to $500,000. (J) $500,000 to $1,000,000. (K) $1,000,000 and over. (5) NET HOUSEHOLD FISCAL IMPACT.--The term "net household fiscal impact" means the combined effect on a household of-- (A) any change in Federal tax liability (including income taxes, payroll taxes, and excise taxes); and (B) any change in the value of benefits received under covered Federal benefit programs, expressed as a dollar amount. SEC. 4. HOUSEHOLD IMPACT STATEMENT REQUIRED FOR COVERED LEGISLATION. (a) Preparation of Household Impact Statement.-- (1) IN GENERAL.--For any covered legislation, the Director of the Congressional Budget Office, in coordination with the Chief of Staff of the Joint Committee on Taxation, shall prepare a Household Impact Statement in accordance with this section. (2) TIMING.-- (A) COMMITTEE-REPORTED LEGISLATION.--In the case of covered legislation ordered reported by a committee of the Senate or the House of Representatives, the Household Impact Statement shall be completed and made publicly available not later than 72 hours before the covered legislation is scheduled for consideration on the floor of the respective House. (B) AMENDMENTS AND SUBSTITUTES.--In the case of a manager's amendment, amendment in the nature of a substitute, or conference report that constitutes covered legislation, the Household Impact Statement shall be completed and made publicly available not later than 72 hours before a vote on adoption of such amendment or conference report. (C) RECONCILIATION LEGISLATION.--In the case of a reconciliation bill or resolution under section 310 of the Congressional Budget Act of 1974 (2 U.S.C. 641) that constitutes covered legislation, the Household Impact Statement shall be completed and made publicly available not later than 72 hours before the covered legislation is scheduled for consideration on the floor of the respective House. (b) Contents of Household Impact Statement.--Each Household Impact Statement shall include the following: (1) FIVE-YEAR DISTRIBUTIONAL FORECAST.--A year-by-year estimate, for each of the 5 fiscal years beginning with the first fiscal year for which the covered legislation would be effective, of the change in Federal tax liability for each income category, expressed as-- (A) the aggregate change in Federal tax liability for all tax filing units in such income category; (B) the average change in Federal tax liability per tax filing unit in such income category; and (C) the change in the average Federal tax rate for tax filing units in such income category. (2) IDENTIFICATION OF SCHEDULED CHANGES.--A clear and specific identification of any provision in the covered legislation that would-- (A) sunset, expire, or terminate during or after the 5-fiscal-year period described in paragraph (1); (B) phase in or phase out during such period; (C) change rates, thresholds, or eligibility criteria during such period based on a schedule established in the legislation; (D) be triggered by an economic indicator, revenue target, or other contingency; or (E) revert to prior law upon expiration, including a description of the tax liability that would result under such prior law for each income category. (3) BENEFIT OFFSET ANALYSIS.--If the covered legislation includes, or is considered contemporaneously with, provisions that would reduce direct spending for one or more covered Federal benefit programs, the Household Impact Statement shall include-- (A) for each covered Federal benefit program affected, a year-by-year estimate for each of the 5 fiscal years described in paragraph (1) of the aggregate reduction in benefits for households in each income category; (B) the average reduction in benefits per affected household in each income category for each such fiscal year; (C) the number of individuals estimated to lose eligibility for, or experience a reduction in benefits under, each covered Federal benefit program, disaggregated by income category; and (D) a net household fiscal impact calculation for each income category for each such fiscal year, showing the combined effect of the change in tax liability under paragraph (1) and the change in benefits under this paragraph, expressed as-- (i) the aggregate net fiscal impact for all households in such income category; (ii) the average net fiscal impact per household in such income category; and (iii) a clear statement, for each income category, of whether the net fiscal impact is positive (a net gain) or negative (a net cost) for households in such category. (4) STATE-LEVEL ANALYSIS.--For each of the 50 States and the District of Columbia, an estimate of-- (A) the aggregate change in Federal tax liability for tax filing units in such State for each of the 5 fiscal years described in paragraph (1); (B) the average change in Federal tax liability per tax filing unit in such State for each such fiscal year; and (C) if a benefit offset analysis is required under paragraph (3), the aggregate net household fiscal impact for households in such State for each such fiscal year. (5) PLAIN-LANGUAGE SUMMARY.--A plain-language summary, written at a reading level accessible to the general public (not higher than an 8th-grade reading level, as measured by the Flesch-Kincaid readability test or a comparable standard), that-- (A) describes the overall effect of the covered legislation on households at each income category in each year of the 5-fiscal-year period; (B) identifies any year in which a tax reduction provided in the first year is reduced, eliminated, or reversed for any income category; (C) identifies any income category for which the net household fiscal impact (taking into account both tax changes and benefit changes) is negative in any year of the 5-fiscal-year period; and (D) includes a statement in the following form: "If you earn between $[lower bound] and $[upper bound], this legislation is estimated to [increase/ decrease] your Federal taxes by an average of $[amount] in [year]. Taking into account changes to [program names], your net [gain/cost] is estimated to be $[amount] in [year]." (c) Methodology and Assumptions.-- (1) TAX ESTIMATES.--All estimates of changes in Federal tax liability shall be prepared by the Joint Committee on Taxation using the microsimulation models and methodology described in the most recent edition of the Joint Committee on Taxation's overview of revenue estimating procedures. (2) BENEFIT ESTIMATES.--All estimates of changes in benefits under covered Federal benefit programs shall be prepared by the Congressional Budget Office using its standard estimating methodology. (3) COORDINATION.--The Director of the Congressional Budget Office and the Chief of Staff of the Joint Committee on Taxation shall jointly establish procedures for coordinating the preparation of Household Impact Statements, including procedures for reconciling differences in assumptions, income classifications, and time periods. (4) ASSUMPTIONS DISCLOSED.--Each Household Impact Statement shall include a clear disclosure of all material assumptions used in preparing the estimates, including assumptions regarding-- (A) economic growth, inflation, and interest rates; (B) behavioral responses of taxpayers; (C) participation rates in covered Federal benefit programs; and (D) the interaction between tax provisions and benefit eligibility. SEC. 5. AMENDMENTS TO THE CONGRESSIONAL BUDGET ACT OF 1974. (a) Additional Duties of the Congressional Budget Office.--Section 202 of the Congressional Budget Act of 1974 (2 U.S.C. 602) is amended by adding at the end the following: "(h) Household Impact Statements.-- "(1) IN GENERAL.--The Director shall, in coordination with the Chief of Staff of the Joint Committee on Taxation, prepare Household Impact Statements for covered legislation as required under section 4 of the Tax Forecast Transparency Act of 2026. "(2) DEFINITIONS.--For purposes of this subsection, the terms 'covered legislation' and 'Household Impact Statement' have the meanings given such terms in section 3 of the Tax Forecast Transparency Act of 2026.". (b) Public Access.--Section 203 of the Congressional Budget Act of 1974 (2 U.S.C. 603) is amended by adding at the end the following: "(e) Household Impact Statements.--The Director shall make each Household Impact Statement prepared under section 202(h) available to the public on the website of the Congressional Budget Office in a searchable, downloadable, and machine-readable format not later than the time such statement is transmitted to the relevant committee or chamber.". SEC. 6. AMENDMENT TO THE INTERNAL REVENUE CODE OF 1986. (a) Additional Duty of the Joint Committee on Taxation.--Section 8022 of the Internal Revenue Code of 1986 (26 U.S.C. 8022) is amended by adding at the end the following: "(5) HOUSEHOLD IMPACT STATEMENTS.-- "(A) IN GENERAL.--The Joint Committee shall, in coordination with the Director of the Congressional Budget Office, prepare the tax liability components of Household Impact Statements for covered legislation as required under section 4 of the Tax Forecast Transparency Act of 2026. "(B) DISTRIBUTIONAL ANALYSIS REQUIRED.--The distributional analysis prepared by the Joint Committee under subparagraph (A) shall include, for each income category (as defined in section 3(4) of the Tax Forecast Transparency Act of 2026), the information described in section 4(b)(1) of such Act. "(C) PUBLIC AVAILABILITY.--Notwithstanding any other provision of law, the distributional analysis and other information prepared by the Joint Committee under this paragraph shall be made publicly available at the same time and in the same manner as the Household Impact Statement of which it is a part.". SEC. 7. POINTS OF ORDER. (a) In the House of Representatives.-- (1) POINT OF ORDER.--It shall not be in order in the House of Representatives to consider covered legislation unless the Household Impact Statement required under section 4 has been publicly available for not less than 72 hours. (2) WAIVER.--The point of order described in paragraph (1) may be waived or suspended in the House of Representatives only by a specific provision in a special rule reported by the Committee on Rules, and any such special rule shall include a statement explaining why the Household Impact Statement was not available. (b) In the Senate.-- (1) POINT OF ORDER.--It shall not be in order in the Senate to proceed to the consideration of covered legislation unless the Household Impact Statement required under section 4 has been publicly available for not less than 72 hours. (2) WAIVER.--The point of order described in paragraph (1) may be waived or suspended in the Senate only by an affirmative vote of three-fifths of the Members, duly chosen and sworn. (3) APPEAL.--An affirmative vote of three-fifths of the Members, duly chosen and sworn, shall be required to sustain an appeal of the ruling of the Chair on a point of order raised under this subsection. (c) DISPOSITION OF POINT OF ORDER IN THE SENATE.-- (1) IN GENERAL.--If a point of order is sustained under subsection (b), the covered legislation shall be returned to the calendar until such time as the Household Impact Statement has been publicly available for not less than 72 hours. (2) SESSION DAYS.--For purposes of this section, the 72-hour period shall be calculated based on calendar hours, not legislative days. SEC. 8. ONLINE HOUSEHOLD IMPACT TOOL. (a) Establishment.--Not later than 1 year after the date of enactment of this Act, the Director of the Congressional Budget Office, in consultation with the Chief of Staff of the Joint Committee on Taxation, shall establish and maintain a publicly accessible, interactive online tool (referred to in this section as the "Household Impact Tool") on the website of the Congressional Budget Office. (b) Functionality.--The Household Impact Tool shall allow any individual to-- (1) select covered legislation that is pending before or has been passed by either House of Congress; (2) enter the individual's State of residence and approximate income category; and (3) receive a plain-language estimate of-- (A) the estimated change in the individual's Federal tax liability for each year of the 5-fiscal-year period covered by the Household Impact Statement; (B) the estimated change in the value of benefits the individual may receive under covered Federal benefit programs for each such year; and (C) the estimated net household fiscal impact for each such year. (c) Disclaimer.--The Household Impact Tool shall prominently display a disclaimer stating that the estimates provided are based on averages for the selected income category and State and do not constitute individualized tax or financial advice. (d) Accessibility.--The Household Impact Tool shall comply with section 508 of the Rehabilitation Act of 1973 (29 U.S.C. 794d) and shall be available in English and Spanish. (e) Data Format.--All data underlying the Household Impact Tool shall be made available in open, machine- readable formats for download by the public. SEC. 9. REPORTING REQUIREMENTS. (a) Annual Report.--Not later than March 1 of each year, the Director of the Congressional Budget Office shall submit to the Committee on the Budget of the Senate, the Committee on the Budget of the House of Representatives, the Committee on Finance of the Senate, and the Committee on Ways and Means of the House of Representatives a report that includes-- (1) the number of Household Impact Statements prepared during the preceding calendar year; (2) the average time required to prepare each such statement; (3) any methodological changes made during the preceding year; and (4) recommendations for improving the accuracy, timeliness, or accessibility of Household Impact Statements. (b) Retrospective Accuracy Review.-- (1) IN GENERAL.--Not later than 3 years after the date of enactment of any covered legislation for which a Household Impact Statement was prepared, the Director of the Congressional Budget Office, in coordination with the Chief of Staff of the Joint Committee on Taxation, shall prepare and make publicly available a retrospective accuracy review comparing-- (A) the estimates contained in the Household Impact Statement with the actual fiscal effects of the covered legislation, to the extent such actual effects can be determined; and (B) any significant deviations between estimated and actual effects, together with an explanation of the factors contributing to such deviations. (2) PUBLIC AVAILABILITY.--Each retrospective accuracy review under this subsection shall be made publicly available on the website of the Congressional Budget Office. SEC. 10. AUTHORIZATION OF APPROPRIATIONS. (a) Congressional Budget Office.--There are authorized to be appropriated to the Congressional Budget Office such sums as may be necessary to carry out the additional duties imposed by this Act, including the development and maintenance of the Household Impact Tool under section 8. (b) Joint Committee on Taxation.--There are authorized to be appropriated to the Joint Committee on Taxation such sums as may be necessary to carry out the additional duties imposed by this Act. SEC. 11. RULEMAKING. (a) Exercise of Rulemaking Powers.--Sections 7(a) and 7(b) of this Act are enacted by Congress-- (1) as an exercise of the rulemaking power of the House of Representatives and the Senate, respectively, and as such they shall be considered as part of the rules of each House, respectively, and such rules shall supersede other rules only to the extent that they are inconsistent therewith; and (2) with full recognition of the constitutional right of either House to change such rules (so far as relating to such House) at any time, in the same manner, and to the same extent as any other rule of such House. SEC. 12. EFFECTIVE DATE. (a) In General.--Except as provided in subsection (b), this Act shall take effect on the date that is 180 days after the date of enactment of this Act. (b) Online Tool.--Section 8 shall take effect on the date that is 1 year after the date of enactment of this Act. (c) Application.--The requirements of this Act shall apply to covered legislation introduced or reported on or after the effective date described in subsection (a). ``` ---