(a) In general.—Section 55(d)(4) is amended—
(1) in subparagraph (A), by striking “, and before January 1, 2026”, and
(2) by striking “and before 2026” in the heading.
(b) Modification of inflation adjustment.—Section 55(d)(4)(B) is amended—
(1) by striking “2018” and inserting “2018 (2026, in the case of the $1,000,000 amount in subparagraph (A)(ii)(I))”, and
(2) by striking “determined by substituting ‘calendar year 2017’ for ‘calendar year 2016’ in subparagraph (A)(ii) thereof.” and inserting “determined by substituting for ‘calendar year 2016’ in subparagraph (A)(ii) thereof—
“(1) ‘calendar year 2017’, in the case of the $109,400 amount in subparagraph (A)(i)(I) and the $70,300 amount in subparagraph (A)(i)(II), and
“(2) ‘calendar year 2025’, in the case of the $1,000,000 amount in subparagraph (A)(ii)(I).”.
(c) Modification of phaseout amount.—Section 55(d)(4)(A)(ii) is amended by striking “and” at the end of subclause (II), and by adding at the end the following new subclause:
“(IV) by substituting ‘50 percent’ for ‘25 percent’, and”.
(d) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2025.