On July 4, 2025, OBBBA §70304 amended IRC §163(j) to base the business-interest limitation on adjusted taxable income computed with depreciation, amortization, and depletion added back. ¹ This is a return to the pre-2022 framework, which the practitioner community has been requesting since the EBIT calculation took effect three years ago.
For our real-estate, construction, and capital-intensive manufacturing clients, this is the most consequential change in the bill. It is also among the least covered in the financial press, partly because it sits in a technically dense corner of the Code.
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