What Is Budget Reconciliation?

Budget reconciliation is a special legislative process in the United States Congress that allows certain tax, spending, and debt limit legislation to pass the Senate with a simple majority of 51 votes rather than the 60-vote supermajority typically needed to overcome a filibuster. Created by the Congressional Budget Act of 1974, reconciliation was originally designed to help Congress align spending and revenue levels with the targets set in the annual budget resolution. In practice, reconciliation has become one of the most powerful tools available to the majority party for enacting major policy changes, particularly on taxes and entitlement programs. Notable legislation passed through reconciliation includes the Tax Cuts and Jobs Act of 2017, the Affordable Care Act in 2010, and portions of welfare reform in 1996. The process is governed by the Byrd Rule, which restricts the inclusion of provisions that do not have a direct budgetary impact, are merely incidental to the budget, or would increase the deficit beyond the budget window. Understanding reconciliation is essential for following major legislative debates in Congress, as it often determines whether significant policy proposals can realistically become law.

This entry is part of the Republican Leaders Political Glossary, an educational reference on American government, legislative processes, and civic institutions.