Ensuring Better Interest Treatment and Deductibility Act (EBITDA)

The Ensuring Better Interest Treatment and Deductibility Act modifies how businesses calculate interest expense limits for tax purposes. It removes a specific exception related to adjusted taxable income calculations that was added in previous legislation. This change applies to tax years starting after December 31, 2025, affecting businesses that deduct interest expenses on their federal income tax returns. The bill aims to alter the rules governing Section 163(j) of the Internal Revenue Code without changing the overall cap on deductible interest.