Americans vote for every House seat and 35 Senate seats on 3 November. Here is what each result could change for private equity, private credit and real estate, and what it can't.

The quick version. Congress writes US tax law, and on 3 November voters pick who sits in it for the next two years. But President Trump stays in office until January 2029, and he can veto any bill he doesn't like. So whoever wins, big tax changes are hard to pass before then. The election decides something smaller but still real. It decides which ideas get a hearing, what goes into the deals Congress has to make, and where the debate starts in 2029. If you work in or invest through a fund, five things are on the table. They are the tax on carried interest, the corporate tax rate, the limit on deducting interest, the breaks for real estate, and the global minimum tax.

Why a tax site is covering an election

Congress makes tax law. The IRS and the Treasury fill in the details, but the rates, the deductions and the big rules all come from bills that pass the House and the Senate and that the President signs.

The midterms happen halfway through a president's four year term. This time voters elect all 435 members of the House and 35 of the 100 senators. The winners take their seats in January 2027.

Control of each chamber matters for tax. The party with the most seats runs the committees that write tax bills. In the House that is Ways and Means. In the Senate it is Finance. The people who chair those committees decide which bills get a debate and which ones never come up.

Republicans control both chambers today, by small margins. This article won't predict who wins. It walks you through what each likely result means for funds and the people who work in them.

Start with the law you already have

You can't judge what might change without knowing what's in place. In July 2025 Congress passed the One Big Beautiful Bill Act, or OBBBA. Republicans passed it without Democratic votes. It did two big things.

It kept the 2017 tax cuts going. The 2017 tax law cut income tax rates for individuals, but those cuts were set to end after 2025. OBBBA made them permanent. The top rate stays at 37%. The 21% corporate tax rate was already permanent.

It locked in several business breaks. According to the Tax Foundation, these are now permanent.

  • 100% bonus depreciation. A business can deduct the full cost of new equipment in the year it buys it, instead of over many years.
  • Full write off of US research costs in the year they are spent.
  • A looser cap on interest deductions. Under section 163(j), a business can deduct interest up to 30% of its earnings before depreciation and amortisation. Between 2022 and 2025 the cap used a smaller measure of earnings, so companies could deduct less.
  • The 20% deduction for business owners (section 199A). Owners of partnerships and similar businesses can deduct 20% of their business income. Ordinary dividends from REITs, the companies that own property and pay out most of their rent as dividends, qualify too.
  • Opportunity zones. These give tax breaks for investing in poorer areas. They are now a permanent programme, with a new set of zones every 10 years.

A few pieces are temporary. Here is when they end.

  • The $40,000 cap on deducting state and local taxes runs to 2029 and then drops back to $10,000.
  • The deductions for tips, overtime, car loan interest and the extra deduction for seniors end after 2028.
  • The write off for new factory buildings only applies if building starts by the end of 2029.

Carried interest wasn't touched. People talked about changing it during the debate. The final law left it alone.

So here's the point. Almost everything that matters to funds is now permanent. That means nothing forces Congress to act in the next two years, the way the 2025 deadline did last year. If anyone wants to change these rules, they have to pass a new law.

When the 2025 law's temporary tax breaks end

Last year each temporary break applies. Hover or tap a bar.

Temporary breakLast year it applies
Tips and overtime deductions2028
Senior deduction2028
Car loan interest deduction2028
$40,000 SALT cap2029
Factory building write off (building must start)2029
Source: Tax Foundation, One Big Beautiful Bill Does Better with Permanence, but Is Still Full of Temporary Provisions

What the election can't change

Whoever wins, President Trump keeps his veto until January 2029. To override a veto, Congress needs two thirds of the House and two thirds of the Senate. Neither party is anywhere near that.

The Senate has its own hurdle. Most bills need 60 of the 100 senators to get past a filibuster, the tactic the losing side uses to block a vote. Tax bills can skip it through a process called budget reconciliation, which needs a simple majority. Congress passed both the 2017 and the 2025 tax laws this way. Joshua Odintz, a partner at the law firm Holland & Knight, said this month that whichever party runs Washington will use reconciliation, since it shuts the other side out. A reconciliation bill still needs the President's signature.

Put it together. A party that wins Congress but not the White House can block bills, slow them down and bargain. It can't rewrite the tax code alone before 2029.

If Republicans keep the House and the Senate

In this case the 2025 law stays, and Republicans keep the option of a second reconciliation bill.

House Republicans have talked about one all year. According to EY, Budget Committee chair Jodey Arrington supports a bill on health care, housing and fraud in federal programmes. Ways and Means chair Jason Smith and Appropriations chair Tom Cole doubt one can pass. Andrew Siracuse, also a partner at Holland & Knight, said a Republican win would make a rushed bill after the election less likely and a fresh attempt next year more likely.

For funds, this is the no change result. Carried interest, the interest deduction and the real estate breaks would most likely stay as they are. A new bill would more likely extend or adjust breaks than raise taxes.

If Democrats win the House and Republicans keep the Senate

A reconciliation bill has to pass both chambers. With each party holding one, neither can pass one alone.

What happens instead is bargaining over the bills Congress has to pass, such as the yearly bills that fund the government. Odintz expects a spending bill both parties can agree on, with a small tax section. He says Democrats would push for what they call affordability measures. Those include bringing back the bigger health insurance tax credit that ended after 2025, and larger credits for low paid workers and for families with children.

Every deal needs a trade, and business taxes are one place to find the money. Congress also has to decide on a short list of breaks that are running out, such as a credit for hiring people who have trouble finding work, and a credit for building chip factories that ends after 2026. Odintz called this year's list thin, which leaves less to trade.

For funds, a split Congress most likely means few big changes. Expect more hearings, more investigations and more bills that serve as opening bids for 2029.

If Democrats win the House and the Senate

Democrats could then pass bills, including through reconciliation. The President could still veto them. Siracuse said Democrats would try to take back tax benefits that went to high earners and multinational companies, but he didn't expect those efforts to get far soon.

You can see what Democrats want from bills they've already introduced. EY lists three.

  • The Keep Your Pay Act, from Senator Cory Booker, would make the first $75,000 of income free of income tax for married couples. A higher corporate tax rate, a higher tax on stock buybacks (when a company buys back its own shares) and tighter limits on deducting executive pay would cover part of the cost.
  • The Working Americans' Tax Cut Act, from Senators Chris Van Hollen, Booker, Mark Kelly and others, would cover its tax cuts with an extra tax on millionaires. For a single person it starts at 5% of income above $1 million and rises to 12% above $5 million.
  • Senator Bernie Sanders wants a 5% tax each year on the wealth of billionaires.

Kimberly Clausing and Natasha Sarin, who both worked at the Treasury under President Biden, have also written a paper on raising money through the corporate tax. One of their ideas is applying the 15% global minimum tax in full to US companies, according to the accounting firm Eide Bailly.

None of these would get past a veto. They matter as a list of ideas for 2029, when a new president takes office.

Why carried interest keeps coming back

Carried interest is the share of a fund's profit that goes to the people who run it, usually 20%. Say a fund buys a company for $100 million and sells it four years later for $200 million. The $100 million profit is mostly paid out to the fund's investors, but around $20 million goes to the managers as carry.

If the fund held the investment for more than three years, the managers pay tax on that carry at the long term capital gains rate, 20% at the top. Wages are taxed at up to 37%. On $20 million, that gap is worth about $3.4 million.

Critics say carry is really pay for work and should be taxed like wages. Supporters say it's a real share of the risk and the profit, and that taxing it more would mean fewer long term investments.

In April 2026, Senators Ron Wyden, Sheldon Whitehouse and Angus King introduced the Ending the Carried Interest Loophole Act. According to the law firm DLA Piper, it would make managers pay income tax every year on an assumed amount of pay, based on the money in the fund, whether the fund made a profit or paid out anything. That's a form of phantom income, meaning tax on money you haven't received. The bill has no Republican backers.

The election won't settle this. Democrats have talked about changing carried interest for years and didn't do it even when they ran Washington. President Trump has also called for changing it in the past. A Democratic Congress would give the idea a stage, with hearings, votes and a bill ready for 2029.

The other rules that matter to funds

Interest deductions. Private equity firms and property investors borrow heavily to buy companies and buildings. The looser section 163(j) cap lets those companies deduct more of their interest, which cuts their tax bill. Tightening the cap is a way to raise money without raising tax rates, so it could come up in any deal.

The corporate rate. Most companies owned by private equity funds pay corporate tax. A higher rate leaves less profit for investors and lowers the price a buyer will pay for the company. Democratic bills would raise it. Republicans cut it to 21% in 2017 and haven't proposed raising it.

Real estate. The REIT dividend deduction, opportunity zones and bonus depreciation are all permanent now. Changing them takes a new law.

The global minimum tax. Dozens of countries have agreed to a 15% minimum tax on big multinational companies. A deal known as the "side by side" agreement currently exempts US companies from parts of it. Clausing's plan would end that exemption. Eide Bailly expects Republicans to reject it.

Why you can stay calm, and why you might not

Reasons to stay calm. The veto lasts until January 2029. Most of the 2025 law is permanent. Nothing forces Congress to act. The most likely outcome in every case is that the tax rules funds rely on today look much the same in 2028. And plenty of ideas floated before an election never become law.

Reasons to pay attention. When one party holds Congress and the other holds the White House, deals often pair a popular tax cut with a quieter way to raise money. The interest deduction is one of the first places lawmakers look. Hearings can shift public opinion. And funds hold investments for five to ten years. When they buy today, they are betting on the tax rules of 2029 and later, and the next two years will shape those rules.

What to watch

  • 3 November. Who wins the House and the Senate. The new Congress starts in January 2027.
  • The lame duck weeks. Between the election and January, the current Congress can still pass bills, including a year end spending deal with tax pieces in it.
  • The committee chairs. Whoever runs Ways and Means and Finance decides which tax bills move.
  • Breaks running out. The health insurance credit, the hiring credit and the chip factory credit.
  • The 2028 race. Expect carried interest, the corporate rate and the global minimum tax to come up in the presidential campaign.

This is analysis, not tax or investment advice.

Sources