Passed
341 Yea79 Nay11 Not voting1/2 required
HR-7006-119
Received in the Senate.
Sponsored by Tom Cole (R-OK)
What it does
This bill would appropriate funds for the federal government's financial services, general government operations, and national security/foreign affairs programs for fiscal year 2026 (ending September 30, 2026). Division A funds the Department of the Treasury (including the IRS, FinCEN, and the CDFI Fund), the Executive Office of the President, the federal judiciary, the District of Columbia, and various independent agencies. Division B funds the Department of State, foreign assistance programs, international security assistance, and multilateral and export programs. The bill also includes government-wide policy provisions, reporting requirements, and a $174,000 payment to the widow of a deceased Member of Congress.
Who benefits
U.S. taxpayers who use IRS services, including low-income filers served by the Community Volunteer Income Tax Assistance program ($46M) and elderly taxpayers served by the Tax Counseling for the Elderly program ($12M). Low-income taxpayer clinic clients ($28M in grants). Residents of economically distressed communities served by Community Development Financial Institutions (CDFIs), including those in persistent-poverty counties and Native American, Native Hawaiian, and Alaska Native communities. Small businesses and individuals in food deserts served by the Healthy Food Financing Initiative ($24M). Communities in high-intensity drug trafficking areas. Foreign aid recipients and partner nations receiving bilateral and multilateral assistance. Federal employees across Treasury, the Executive Office of the President, and the State Department. Victims of financial crimes and sanctions targets' adversaries, through the Office of Terrorism and Financial Intelligence ($237M). Treasury cybersecurity infrastructure beneficiaries, including agencies relying on secure federal financial systems.
Who is hurt
Taxpayers and agencies that may face reduced flexibility due to strict transfer caps and congressional approval requirements. Organizations that could be affected by the freeze on IRS guidance regarding 501(c)(4) social welfare organization standards, potentially locking in pre-2010 rules. Federal employees whose bonuses or rehiring may be restricted based on tax compliance and conduct reviews. Agencies or programs not funded or funded at lower levels than requested. Foreign governments or international organizations that may receive reduced or conditioned assistance under Division B. Potential museum visitors or stakeholders if the U.S. Mint is barred from constructing museums without multi-committee approval. Parties who might prefer updated IRS regulatory guidance on nonprofit political activity standards, which this bill would block for FY2026.
Supporters argue
Supporters argue that this bill funds essential government operations — including $4.999 billion for IRS tax enforcement and $3.037 billion for taxpayer services — that directly affect every American who files a tax return, while including meaningful accountability provisions such as quarterly IT reporting requirements and restrictions on ideologically targeted IRS scrutiny. They contend the CDFI Fund's $324 million in targeted community lending, the $298 million High Intensity Drug Trafficking Areas program, and the $237 million for terrorism and financial intelligence represent high-return investments in economic inclusion and national security. They further argue that the bill's reporting requirements on the Strategic Bitcoin Reserve and Treasury Forfeiture Fund reflect responsible congressional oversight of novel and high-risk government asset programs.
Opponents argue
Opponents argue that the bill's freeze on IRS 501(c)(4) guidance — locking standards at their January 1, 2010 baseline — prevents the agency from updating rules to reflect current law and court decisions, effectively using appropriations to override the regulatory process. They contend that the bill's scale and complexity, spanning two major divisions and dozens of agencies, limits meaningful congressional deliberation on individual funding decisions and policy riders. They further argue that provisions restricting IRS employee bonuses and rehiring based on tax compliance, while superficially reasonable, could be used to suppress workforce morale and reduce enforcement capacity at an agency already managing significant backlogs.
Constitutional context
The Appropriations Clause (Art. I, §9, cl. 7) gives Congress exclusive authority to appropriate funds, and this bill is a direct exercise of that power. The bill's freeze on IRS regulatory guidance for 501(c)(4) organizations raises a potential separation of powers question: using appropriations riders to direct or block executive agency rulemaking is a well-established but occasionally contested practice. Post-Loper Bright (2024), any IRS or Treasury rules issued under existing statutory authority will face independent judicial scrutiny rather than deference, making the bill's reporting and oversight provisions more consequential as a check on agency action.
Checks and balances
Congress gains direct control over executive branch spending and policy through appropriations riders and reporting mandates; the executive branch retains implementation discretion within funded accounts, subject to advance committee approval for most fund transfers.
Historical precedent
Annual Financial Services and General Government appropriations bills have been enacted each fiscal year since the modern appropriations structure was established; the use of riders to freeze agency rulemaking, as with the 501(c)(4) guidance block, follows a pattern used in prior-year versions of this same bill.
Passed