H.R. 652House119th Congress (2025-2027)In Committee

Small Business Investor Tax Parity Act of 2025

To amend the Internal Revenue Code of 1986 to allow the deduction under section 199A to apply to qualified BDC interest dividends in the same manner as qualified REIT dividends.

AI-Generated Summary

Updated November 24, 2025 at 3:22 AM UTC

The Small Business Investor Tax Parity Act of 2025 updates the tax code so that investors can claim the Section 199A qualified business income deduction for interest dividends received from certain business development companies, just as they can for REIT dividends. It defines what counts as a qualified BDC interest dividend and limits the benefit to BDCs that have elected regulated investment company status. The new rules will apply to tax years starting in 2027, affecting individual and entity investors who hold these BDC dividends.

Key Provisions

Amends the qualified business income deduction (Section 199A) to treat qualified business development company (BDC) interest dividends the same way it treats qualified REIT dividends.
Creates a new definition of “qualified BDC interest dividend,” meaning any dividend from an electing BDC that comes from the company’s net interest income and is tied to a qualified trade or business.
Specifies that an “electing BDC” is a BDC that has made the election under Section 851 to be treated as a regulated investment company.
Sets the changes to take effect for taxable years beginning after December 31, 2026.

Legislative Activity

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1 earlier action

HouseIntro Referral Latest Action

Referred to the House Committee on Ways and Means.

Ways and Means Committee

January 23, 2025

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HouseIntro Referral

Introduced in House

January 23, 2025

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

January 23, 2025

Floor Debate

1 member

What members said about H.R. 652 on the floor

1 Republican

Rep. Monica De La CruzR-TX-15 · Jul 9, 2026

Under clause 7 of rule XII, sponsors were added to public bills and resolutions, as follows: H.R. 7: Mr. Van Epps. H.R. 138: Ms. Norton, Ms. Hoyle of Oregon, and Mr. Calvert. H.R. 491: Ms. Wilson of…

Under clause 7 of rule XII, sponsors were added to public

bills and resolutions, as follows:

H.R. 7: Mr. Van Epps.

H.R. 138: Ms. Norton, Ms. Hoyle of Oregon, and Mr. Calvert.

H.R. 491: Ms. Wilson of Florida.

H.R. 516: Mr. Mullin.

H.R. 569: Ms. Fedorchak.

H.R. 614: Mr. Lawler.

H.R. 652: Ms. Moore of Wisconsin.

H.R. 1055: Mr. Costa and Mr. Keating.

H.R. 1065: Ms. Garcia of Texas.

H.R. 1105: Mr. Gallagher.

H.R. 1106: Mr. Riley of New York.

H.R. 1138: Ms. Salazar.

H.R. 1189: Ms. Clarke of New York.

H.R. 1227: Mr. Himes and Mr. Rulli.

H.R. 1229: Mr. Van Epps.

H.R. 1340: Mr. Obernolte.

H.R. 1589: Mr. Pappas.

H.R. 1685: Ms. DelBene.

H.R. 1700: Ms. McCollum.

H.R. 1782: Mr. Case.

H.R. 1787: Ms. Tlaib, Mr. Levin, Mr. Mrvan, Mr. Ivey, Mr.

Pocan, and Mr. Menefee.

H.R. 1946: Mr. Higgins of Louisiana.

H.R. 1970: Mr. Van Orden.

H.R. 2002: Mr. Fitzpatrick.

H.R. 2028: Mr. Torres of New York.

H.R. 2089: Mr. Timmons, Mr. Van Epps, Mrs. Fischbach, and

Ms. De La Cruz.

H.R. 2120: Ms. Perez.

H.R. 2245: Mr. Carson.

H.R. 2305: Mr. Thompson of Pennsylvania and Mr. Magaziner.

H.R. 2332: Mr. Carey.

H.R. 2350: Mr. Thompson of Pennsylvania.

H.R. 2414: Ms. McBride.

H.R. 2509: Mr. Langworthy.

H.R. 2531: Mr. Costa, Ms. Schrier, Mr. Norcross, and Mr.

Van Orden.

H.R. 2587: Mr. Figures.

H.R. 2678: Mr. Garcia of Illinois, Mrs. McIver, and Mr.

Conaway.

H.R. 2767: Mr. Lynch.

H.R. 2859: Ms. Ross.

H.R. 2936: Mrs. Foushee, Mr. Carbajal, and Mr. Amo.

H.R. 3045: Mr. Riley of New York and Mr. Whitesides.

H.R. 3057: Mr. Hunt.

H.R. 3105: Mr. Fitzgerald.

H.R. 3111: Mr. Pallone.

H.R. 3184: Mr. Crow and Mrs. Grijalva.

H.R. 3199: Mrs. Kim.

H.R. 3206: Mr. Cuellar.

H.R. 3223: Ms. Perez.

H.R. 3243: Mr. Cohen, Mr. Gomez, Mr. Espaillat, Mr. Casar,

Mrs. Foushee, Mr. Case, Ms. Clarke of New York, Ms.

Pettersen, Mr. Castro of Texas, Ms. Brown, and Ms. Meng.

H.R. 3295: Mrs. Kim.

H.R. 3307: Mr. Thanedar, Mr. Mackenzie, and Mr. Buchanan.

H.R. 3310: Mr. Moskowitz.

H.R. 3505: Mr. Amo.

H.R. 3644: Mr. Subramanyam.

H.R. 3821: Mr. Riley of New York.

H.R. 3906: Ms. Williams of Georgia.

H.R. 4092: Mr. Fulcher.

H.R. 4119: Mr. DesJarlais and Mr. Van Epps.

H.R. 4180: Mr. Beyer.

H.R. 4443: Mr. Larson of Connecticut.

H.R. 4487: Ms. Waters.

H.R. 4525: Mr. Deluzio.

H.R. 4620: Ms. De La Cruz.

H.R. 4696: Ms. Crockett and Mr. Torres of New York.

H.R. 4763: Mr. Raskin.

H.R. 4876: Ms. Scholten, Mr. Frost, and Mr. Crow.

H.R. 4881: Mr. Case.

H.R. 4958: Ms. Schrier.

H.R. 5106: Mr. Gallagher and Mr. Hamadeh of Arizona.

H.R. 5199: Mr. Nunn of Iowa.

H.R. 5203: Ms. Stansbury.

H.R. 5335: Mr. Gimenez.

H.R. 5448: Mr. McGovern.

H.R. 5463: Mr. Onder.

H.R. 5486: Mr. Pallone and Mrs. Fletcher.

H.R. 5521: Ms. Salinas.

H.R. 5543: Mr. Raskin.

H.R. 5549: Mrs. Spartz and Mr. Fulcher.

H.R. 5731: Mr. Figures.

H.R. 5791: Mr. Carbajal and Ms. Meng.

H.R. 6056: Mr. Correa, Mr. Meeks, and Ms. Williams of

Georgia.

H.R. 6130: Mr. Gray, Mr. Mrvan, Mr. Raskin, Mr. Larson of

Connecticut, Mrs. Ramirez, Mr. Schneider, Mr. Costa, Mr.

Garbarino, Mr. Rouzer, and Ms. McClellan.

H.R. 6181: Mr. Cisneros and Mr. Harder of California.

H.R. 6509: Mr. Mrvan.

H.R. 6520: Mr. Messmer.

H.R. 6529: Mr. Vindman.

H.R. 6574: Ms. Goodlander.

H.R. 6610: Mr. McCormick.

H.R. 6617: Ms. Hoyle of Oregon.

H.R. 6677: Ms. Hoyle of Oregon and Mr. Amo.

H.R. 6682: Mr. Riley of New York.

H.R. 6694: Ms. Velazquez and Ms. Ocasio-Cortez.

H.R. 6718: Mr. Carson.

H.R. 6766: Mr. Landsman and Mr. Obernolte.

H.R. 6806: Mr. Olszewski and Mr. Amo.

H.R. 6832: Mr. Feenstra.

H.R. 6849: Mr. Costa.

H.R. 7016: Mr. Beyer, Mr. Raskin, and Ms. Simon.

H.R. 7411: Mr. Carson.

H.R. 7539: Mr. Gallagher, Mr. Fine, Mrs. Miller of

Illinois, and Mr. Stauber.

H.R. 7601: Ms. Ocasio-Cortez.

H.R. 7622: Mr. Carson and Mr. Amo.

H.R. 7625: Mr. Garamendi.

H.R. 7651: Mr. Alford, Mr. Austin Scott of Georgia, and Ms.

Boebert.

H.R. 7905: Mr. Bacon.

H.R. 7945: Mr. Kustoff.

H.R. 7961: Ms. Houlahan and Mr. Amo.

H.R. 7977: Mr. Norcross.

H.R. 7986: Ms. Lofgren.

H.R. 7998: Ms. Norton.

H.R. 8016: Ms. Wasserman Schultz.

H.R. 8045: Mr. Scott of Virginia.

H.R. 8073: Mr. Figures.

H.R. 8162: Mr. Lawler.

H.R. 8200: Mr. Bost.

H.R. 8205: Mrs. Miller of West Virginia, Mrs. Hayes, Mr.

Latimer, Mr. Davis of North Carolina, Ms. McBride, Mr. Riley

of New York, Mr. Conaway, Ms. Stansbury, Ms. Ross, Ms.

Pingree, Mr. Himes, Mrs. Watson Coleman, Mr. Casten, Mr.

Landsman, Mrs. Grijalva, Ms. Mejia, Mr. Larson of

Connecticut, Mr. Sorensen, Mr. Peters, Mr. Jackson of

Illinois, Ms. Adams, Ms. Budzinski, Mrs. Beatty, Mr.

Magaziner, Ms. Kaptur, Mr. Carter of Louisiana, Mr. Suozzi,

and Ms. Scanlon.

H.R. 8271: Ms. Tenney.

H.R. 8330: Mr. Gallagher.

H.R. 8373: Mrs. Grijalva.

H.R. 8375: Mr. Carter of Louisiana, Ms. Budzinski, and Mr.

Ciscomani.

H.R. 8411: Mr. Johnson of Georgia.

H.R. 8465: Mr. Keating.

H.R. 8468: Mr. Hunt.

H.R. 8490: Mr. Carson.

H.R. 8501: Mr. Figures and Mr. Thompson of California.

H.R. 8600: Mr. Whitesides.

H.R. 8666: Mr. DeSaulnier, Ms. Friedman, and Mr. Tran.

H.R. 8691: Mr. Carson and Mr. Costa.

H.R. 8730: Mrs. Miller of West Virginia, Ms. Crockett, and

Mr. Mrvan.

H.R. 8839: Mr. Moskowitz.

H.R. 8887: Mr. Neguse.

H.R. 8892: Mr. Carey.

H.R. 8898: Ms. McBride and Mrs. Miller-Meeks.

H.R. 8909: Ms. Velazquez.

H.R. 8939: Ms. Waters.

H.R. 8955: Mr. Crow.

H.R. 8979: Mr. Figures.

H.R. 8982: Mr. Suozzi, Ms. Simon, and Mr. Subramanyam.

H.R. 8990: Mr. Moran.

H.R. 9021: Mr. Thanedar, Ms. Titus, and Mrs. McIver.

H.R. 9032: Ms. Waters and Ms. Crockett.

H.R. 9043: Mr. McDowell.

H.R. 9048: Mr. Riley of New York, Mrs. Kiggans of Virginia,

and Mr. Weber of Texas.

H.R. 9129: Ms. Salinas.

H.R. 9169: Mr. Van Drew.

H.R. 9183: Ms. Crockett.

H.R. 9189: Ms. Tlaib.

H.R. 9199: Mr. Norman.

H.R. 9204: Ms. Chu.

H.R. 9205: Ms. Chu.

H.R. 9211: Mr. Buchanan and Mr. Bell.

H.R. 9216: Mr. Cohen and Ms. Waters.

H.R. 9250: Mr. Garbarino, Ms. DelBene, Mr. Moore of West

Virginia, Mr. Garcia of California, Mr. Harrigan, Mr. Levin,

Mr. Flood, Ms. Chu, Mr. Meuser, and Ms. Crockett.

H.R. 9289: Mr. Vindman.

H.R. 9293: Mr. Evans of Colorado and Mr. Mackenzie.

H.R. 9332: Mr. Vindman.

H.R. 9339: Mr. Vindman.

H.R. 9361: Mr. Finstad and Mr. Jackson of Texas.

H.R. 9370: Ms. Brown and Ms. Scholten.

H.R. 9371: Mr. Frost.

H.R. 9382: Mr. Mannion and Ms. Tenney.

H.R. 9401: Mr. Lawler, Mr. Crow, and Ms. DelBene.

H.R. 9411: Mr. Fitzpatrick.

H.R. 9414: Mr. Vindman, Mr. Cisneros, Mr. Keating, and Ms.

McBride.

H.R. 9417: Mr. Moylan, Mr. Haridopolos, Mr. Rogers of

Kentucky, and Mr. McDowell.

H.R. 9421: Ms. Tenney and Mr. Steube.

H.R. 9441: Ms. Dexter and Mr. Tonko.

H.R. 9448: Ms. Ross, Mr. Lieu, and Mr. Nadler.

H.R. 9451: Mr. Fitzpatrick.

H.R. 9492: Mr. Fitzpatrick.

H.R. 9508: Mr. Fitzpatrick.

H.R. 9535: Mr. Van Drew.

H.R. 9580: Mr. Messmer.

H.R. 9591: Ms. Crockett, Mr. Evans of Pennsylvania, Ms.

Williams of Georgia, Ms. Underwood, Ms. Simon, Ms. Wilson of

Florida, and Ms. Chu.

H.J. Res. 12: Mr. Ciscomani.

H.J. Res. 135: Mr. Whitesides.

H.J. Res. 200: Mr. Menendez and Mr. Pallone.

H. Con. Res. 37: Mr. Tonko, Ms. Bonamici, and Mrs. Foushee.

H. Con. Res. 44: Ms. Pingree, Ms. Garcia of Texas, Mr.

Vargas, Ms. Wasserman Schultz, Mr. Krishnamoorthi, and Mr.

Pocan.

H. Res. 547: Ms. Waters.

H. Res. 1025: Ms. Waters.

H. Res. 1382: Mrs. Biggs of South Carolina.

H. Res. 1384: Mr. Bell, Ms. Brown, Mr. Garcia of Illinois,

Mrs. Beatty, Ms. Norton, Mrs. McIver, Mr. Goldman of New

York, Mr. Castro of Texas, Ms. Strickland, Mr. Davis of

Illinois, Ms. Barragan, Ms. Mejia, Mr. Conaway, Mr. Takano,

Mr. Menefee, Ms. Salinas, Mrs. Foushee, Ms. Chu, Mr. Cohen,

and Mr. Gomez.

H. Res. 1395: Mr. Fields.

H. Res. 1415: Mr. DeSaulnier and Ms. Jayapal.

H. Res. 1420: Ms. Underwood and Ms. Bynum.

Bill Text

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Introduced in HouseIssued January 23, 2025

119th CONGRESS

1st Session

H. R. 652

IN THE HOUSE OF REPRESENTATIVES

January 23, 2025

Mr. Arrington introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to allow the deduction under section 199A to apply to qualified BDC interest dividends in the same manner as qualified REIT dividends.

Short title

This Act may be cited as the Small Business Investor Tax Parity Act of 2025.

Deduction for qualified business income to apply to certain interest dividends of qualified business development companies

(a)

In general

Subsections (b)(1)(B) and (c)(1) of section 199A of the Internal Revenue Code of 1986 are each amended by inserting , qualified BDC interest dividends, after qualified REIT dividends.

(b)

Qualified BDC interest dividend defined

Section 199A(e) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(5)

Qualified BDC interest dividend

(A)

In general

The term qualified BDC interest dividend means any dividend from an electing business development company received during the taxable year which is attributable to net interest income of such company which is properly allocable to a qualified trade or business of such company.

(B)

Electing business development company

For purposes of this paragraph, the term electing business development company means a business development company (as defined in section 2(a) of the Investment Company Act of 1940) which has an election in effect under section 851 to be treated as a regulated investment company.

(c)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2026.