SUCCESS

Michael Wright, who starred in such films as “The Five Heartbeats,” “The Principal” and “Sugar Hill,” as well as the TV series “V,” has died.

Cathie Wood, head of Ark Investment Management, often adds to her favorite tech stocks when prices swing.

This week, she’s buying SpaceX (SPCX), continuing to build her position after the newly public stock went through a volatile stretch following its first earnings report.

Last year, the flagship Ark Innovation ETF gained 35.49%, far outpacing the S&P 500’s return of 17.88% in the same period. So far this year, Wood’s flagship Ark Innovation ETF (ARKK) is up 10.71% as of August 21, while the S&P 500 surged 12.11%, Yahoo Finance data shows.

Wood gained a reputation after the Ark Innovation ETF delivered a 153% return in 2020. But her style also brings painful losses in bearish markets, as seen in 2022, when the Ark Innovation ETF tumbled more than 60%.

Those swings have weighed on Wood’s long-term gains. As of August 21, her Ark Innovation ETF has delivered a five-year annualized return of -6.23%, while the S&P 500 has an annualized return of 11.56% over the same period, according to data from Morningstar.

Over the past 12 months through August 20, the Ark Innovation ETF saw roughly $2.91 billion in net outflows.Getty Images

Cathie Wood says AI could help sustain high corporate profits

Wood usually focuses on high-tech companies across artificial intelligence, blockchain, biomedical technology, and robotics. She believes these businesses have strong growth potential, though their volatility often causes fluctuations in the Ark’s funds.

Over the decade ended 2025, the Ark Innovation ETF wiped out nearly $5 billion in investor wealth, according to an analysis by Morningstar’s analyst Amy Arnott. That made it the fourth-biggest wealth destroyer among mutual funds and ETFs in the ranking. 

Wood remains optimistic about AI, which she sees as a major driver of productivity, economic growth, and corporate profits in the years ahead.

Related: Cathie Wood buys $22.3 million of surging semiconductor stock

In an Aug. 9 post on X, Wood said U.S. corporate profits remain unusually strong, with domestic profits before tax at 13.2% of GDP, a level she said is near multi-decade highs. 

Some of that strength came from the massive monetary and fiscal stimulus during the pandemic, but Wood believes another factor is helping sustain margins today: companies are leaning into AI and productivity gains to protect them.

“I think we’re still early in seeing how far that can go,” she said, adding that companies that use AI effectively will “separate themselves from the ones that don’t.”

Wood also found reasons for optimism in the latest U.S. jobs report, despite nonfarm payrolls falling by 23,000.

“It’s not as scary as it looks,” she said, pointing to higher prime-age labor force participation, cooling wages and productivity growth approaching 3%. She also suggested AI may be helping accelerate baby boomer retirements.

Not all investors agree with Wood’s optimism. Over the past 12 months through August 20, the Ark Innovation ETF saw roughly $2.91 billion in net outflows, according to data from ETF research firm VettaFi. 

Cathie Wood buys $28.1 million of SpaceX stock

On Aug. 21, Wood’s Ark funds bought a total of 205,031 shares of Space Exploration Technologies Corp (SPCX), also known as SpaceX, according to Ark’s daily trading information. 

Based on the latest closing price of $136.97, these stocks were worth about $28.1 million, making it one of Wood’s biggest recent buys.

SpaceX is a space technology company founded in 2002 by Elon Musk, who also leads Tesla (TSLA). The company is best known for its reusable rockets and Starlink satellite internet business, which is currently its only profitable segment.

SpaceX shares jumped 19% on their June 15 market debut. Since then, however, the stock has given back much of those early gains. Now the stock is down about 40% from the post-IPO high of $225.64, trading near the $135 IPO price.

On Aug. 4, SpaceX reported better-than-expected revenue for the second quarter in its first earnings report since its IPO. The company posted revenue of $7.81 billion, up 92% from the prior year and topping the $6.93 billion expected by analysts. Its loss came in at 9 cents per share, narrower than the 26-cent loss expected.

Still, SpaceX shares sank 13.6% on Aug. 5 as a surge in artificial intelligence spending rattled investors. The company’s capital expenditures jumped sixfold to $18.4 billion in the second quarter, above analysts’ expectations. Most of that spending went toward AI.

Investors have been wary of heavy AI spending as they look for signs that companies can generate returns on their multibillion-dollar investments. SpaceX CFO Bret Johnsen sought to ease concerns about the spending, saying on the earnings call that the company has been “efficient” with its capital.

“On the AI compute side, we’re able to deploy capital in such a way that we’re getting less than a one-year payback,” Johnsen said.

Despite a 13% one-day drop on Aug. 5 following earnings, SpaceX shares have since rebounded 22% through Aug. 22.

Wall Street analysts were mixed on SpaceX following the results.

Related: Veteran fund manager rethinks Intel stock target

Piper Sandler lowered its price target to $140 from $156 and kept a Neutral rating, citing higher capital spending and risks around “cancelable” AI cloud contracts, according to The Fly.

JPMorgan, meanwhile, raised its price target to $240 from $225 and kept an Overweight rating. The firm pointed to SpaceX’s “extreme vertical integration” and stronger expectations for its AI business.

Wood was already a SpaceX investor before the company’s IPO. Ark Invest first bought SpaceX shares in late 2023, and it later became the largest holding in the firm’s roughly $1 billion internal venture fund, according to Business Insider.

Wood has long been one of Musk’s biggest supporters. During a CNBC show covered by TheStreet’s Moz Farooque, she said periods of turmoil often bring out Musk’s best work.

“These difficult times, though, spur Elon’s creativity. He is a troubleshooter and a brilliant technologist,” Wood said. She also heavily invests in Tesla stock.

SpaceX is now the third-largest holding in Wood’s Ark Innovation ETF.

Top 10 Holdings in the Ark Innovation ETF by weight as of August 21, 2026:

Tesla (TSLA) – 9.24%

Tempus AI (TEM) – 6.36%

SpaceX (SPCX) – 5.64%

Circle Internet Group (CRCL) – 5.14%

CRISPR Therapeutics (CRSP) – 4.91%

Coinbase Global (COIN) – 4.46%

Twist Bioscience (TWST) – 3.92%

Shopify (SHOP) – 3.76%

Palantir Technologies (PLTR) – 3.42%

Robinhood Markets (HOOD) – 3.42%

Other than buying SpaceX shares, Wood’s latest trades included buying BWX Technologies (BWXT), Intellia Therapeutics (NTLA), Securitize (SECZ), and Perceptive Capital Solutions (FRNM). 

She also trimmed positions in Palantir Technologies (PLTR), Shopify (SHOP), Deere (DE), Roblox (RBLX), 10x Genomics (TXG), and Brera Holdings (SLMT).

Related: Popular men’s fashion retail chain files Chapter 11 bankruptcy

Nvidia reports August 26. The stock has had a rough few weeks. Bond yields spiked, the broader market sold off, and AI infrastructure names got hit harder than most.

Michael Burry flagged a startup. The circular financing debate keeps resurfacing. There is no shortage of reasons to be cautious heading into next week.

Oppenheimer is not cautious. The firm just reiterated its bullish case with numbers specific enough to be worth examining before the report lands.

Oppenheimer Outperform rating on Nvidia NVDA stock

Oppenheimer maintained its Outperform rating and $265 price target on Nvidia on August 20, according to Investing.com.

The stock trades at a P/E of 33.64 with a PEG ratio of 0.3. Nvidia has delivered 71% revenue growth over the past 12 months. Market cap sits at $5.31 trillion. Gross profit margin is 74%.

Oppenheimer expects Nvidia to beat second-quarter estimates and deliver a stronger-than-expected third-quarter outlook. The firm projects more than $1 trillion in cumulative revenues from Nvidia’s GB200, GB300 and VR200 platforms between 2025 and 2027.

That is a platform-level projection for specific products. It reflects the scale of what hyperscalers and AI developers are committing to spend on infrastructure.

More Nvidia:

Nvidia just made a move Wall Street wasn’t ready for

Nvidia just locked down deal that changes AI race

Nvidia stock is doing something it hasn’t done in years

Nvidia guided to $91 billion in Q2 revenue, plus or minus 2%, with gross margin targets of approximately 75%. Wall Street’s average estimate sits slightly above that at $91.9 billion. The guidance excludes any data center compute revenue from China.

The firm also noted Nvidia’s commitment to SB Energy’s PORTS-Pike Technology Campus in Pike County, Ohio. Nvidia will be the exclusive AI compute infrastructure provider at the campus, with initial capacity of 4.25 gigawatts and an option to expand to 8 gigawatts. OpenAI will lease the campus for 20 years. Nvidia is investing $1.5 billion directly in SB Energy and has provided residual value guarantees capped at $105 billion. Capacity comes online in phases beginning in 2028, CNBC reported.

Blackwell Ultra and Vera Rubin ramp for NVDA investors

Oppenheimer’s near-term case rests on Blackwell Ultra. The next-generation VR200 system is expected to ramp during the current quarter, adding momentum to Nvidia’s data center business in the second half of the year.

Blackwell Ultra’s performance-per-watt advantage is central to the firm’s argument. AI data centers consume enormous amounts of electricity. A chip that produces more computing performance per watt reduces operating costs and helps customers manage limited power capacity.

The firm highlighted two metrics it expects to become increasingly important as AI moves into commercial deployment. Tokens per minute, which measures how quickly a model generates output. Cost per token, which measures how expensive that output is. Oppenheimer says Nvidia is best in class on both.

Nvidia’s advantage isn’t just the GPU itself. The full-stack platform includes GPUs, networking switches, network interface cards, InfiniBand and Ethernet connectivity, NVLink interconnects and CUDA software. Once a customer builds a data center around that stack, switching costs become real.

Oppenheimer is not alone in its bullish stance. Stifel reiterated a Buy at $282.Michael/Getty Images

Vera CPU China H200 and additional Nvidia revenue upside

Oppenheimer expects Nvidia’s Vera CPU to generate approximately $20 billion in revenue in 2026, on a similar scale to Intel and AMD’s CPU businesses, as TheStreet reported.

That widens the Nvidia revenue story beyond accelerators. Data center operators who already buy Nvidia GPUs could increasingly buy a more complete package from a single vendor.

China is the other potential upside. Oppenheimer estimates H200 accelerator sales in China could exceed $50 billion. U.S. export restrictions can change, and policy shifts could alter timing or size. It is upside optionality rather than a base case, but it is a large enough number to move the model meaningfully if conditions align.

Wall Street NVDA price targets ahead of August 26 earnings

Oppenheimer is not alone in its bullish stance. Stifel reiterated a Buy at $282. TD Cowen maintained Buy at $275. Bank of America analyst Vivek Arya set a $350 target and models third-quarter guidance of $107 billion to $108 billion. Goldman Sachs analyst James Schneider holds a Buy with a $285 target and expects meaningful upside to guidance, Investing.com reported.

Moody’s has affirmed Nvidia’s Aa1 senior unsecured rating with a positive outlook. S&P Global Ratings maintained its AA issuer credit rating.

The spread between Oppenheimer’s $265 and BofA’s $350 reflects genuine disagreement about how much of Nvidia’s future growth is already priced in.

What Nvidia needs to do on August 26 is clear. Beat the quarter, raise guidance, show that Blackwell Ultra is ramping as expected, and give investors something specific on the VR200 and Vera Rubin timeline. The stock has already absorbed a lot of bad news. A clean print with strong forward commentary could change the mood quickly. Merely meeting expectations while the broader market is nervous about bond yields and AI financing may not be enough.

Related: Wall Street sends strong signal to Nvidia stock investors

After years of expansion, one of the world’s most recognizable luxury brands is closing stores and exiting an entire market, as it takes a more selective approach to its retail footprint.

The move comes as luxury companies rethink their store networks amid changing consumer behavior, economic uncertainty, and a greater emphasis on high-performing locations and immersive shopping experiences.

Founded in 1854 in Paris, Louis Vuitton is owned by LVMH, the world’s leading luxury group, with more than 75 prestigious brands across fashion, leather goods, wines and spirits, perfumes and cosmetics, watches and jewelry, and selective retailing. Its portfolio includes Louis Vuitton, Fendi, Givenchy, Christian Dior, Tiffany & Co., and more.

Louis Vuitton exits Guizhou, China

Louis Vuitton is closing its only store in Guizhou, a province in southwest China. The Louis Vuitton Guiyang Jianghua store at Lavant Center is scheduled to cease operations on Aug. 31, 2026, ending the brand’s presence in the province after four years.

The Lavant Center opened in 2022 and became a destination for major luxury brands in Guiyang. Louis Vuitton’s departure follows the exit of other high-end brands from the mall, including Cartier and Gucci.

The closure does not mean Louis Vuitton is leaving China entirely. The brand continues to operate in major markets across the country, including Beijing, Shanghai, Chengdu, and Guangzhou.

Instead, the move reflects a broader effort by luxury companies to reassess where physical stores can generate the strongest returns and where larger, more experiential locations can strengthen relationships with customers.

Louis Vuitton has continued investing in major flagship destinations. LVMH said its new Louis Vuitton locations in Beijing and Seoul have performed strongly, highlighting the group’s focus on distinctive stores and customer experiences.

Why Louis Vuitton is exiting the market

The closure comes as the luxury industry adjusts to a more complex consumer environment.

The global fashion industry is expected to see low-single-digit growth in 2026, according to McKinsey & Company’s State of Fashion 2026 Report, while changing consumer preferences and economic uncertainty continue to reshape the market. McKinsey also expects heightened macroeconomic volatility to drive more value-conscious consumer behavior.

China remains one of the world’s most important luxury markets, but its consumers have become more selective following several years of economic and property-market pressures.

At the same time, the luxury market in China is not moving in only one direction. Some second-tier cities have become increasingly important to luxury brands, with consumers in locations such as Nanjing and Changsha supporting strong luxury sales.

Some of these markets have outperformed traditional first-tier destinations, prompting brands to take a more targeted approach to where they invest, Reuters reported.

That makes Louis Vuitton’s closure in Guizhou notable. Rather than indicating a broad retreat from China, the move appears to be part of a more selective retail strategy in which brands concentrate resources on locations that can support stronger sales, customer engagement, and brand experiences.

The effect of the broader luxury slowdown can also be seen in LVMH’s financial results.

During the first half of 2026, LVMH recorded revenue of €38.6 billion, down 3% from the same period a year earlier on a reported basis, while its Fashion and Leather Goods business posted a 1% decline in organic revenue.

Louis Vuitton exits Guizhou, China. MAGWIN / Getty Images

What this means for the future of Louis Vuitton

LVMH seems to be pursuing a strategy that prioritizes the quality and performance of its retail network rather than simply expanding the number of locations.

The company has emphasized innovation and distinctive in-store experiences as it works to attract and retain customers. Its investments have included major projects for Louis Vuitton and Christian Dior, as well as other properties across the group’s portfolio.

Here’s some of my previous coverage of store closures:

Famous designer-created retailer closes dozens of locations

Fashion giant closes another store amid retail shakeup

200-year-old retailer shares its fate after shutdown warning

LVMH has cited Louis Vuitton’s new flagship locations in Beijing and Seoul as strong performers, reinforcing the company’s focus on larger and more experiential destinations.

At the same time, LVMH’s overall store count declined by 96 locations year over year to 6,217 as of June 30, 2026. The figure points to continued changes across the group’s extensive retail network, although the company is also investing in new and upgraded locations.

That combination suggests the future of luxury retail may be less about having the largest possible physical footprint and more about targeting the right locations.

For Louis Vuitton, that approach points toward continued investment in flagship stores and experiences in markets where the company sees strong potential while reconsidering locations that no longer fit its strategy.

“We will continue to adjust to evolving consumer expectation with distinctive stores and experience, attention to perceived value, and increased brand desirability and innovations,” LVMH CFO Cécile Cabanis said during the company’s latest earnings call.

The Guizhou closure therefore offers another example of how Louis Vuitton is reshaping where and how it reaches customers as the market changes.

Related: Sportswear giant continues store closures nationwide

José Mourinho makes his competitive return to Real Madrid after 13 years, facing immense pressure to deliver silverware following the club’s two-season trophy drought.

Just because you close a business does not mean its expenses end.

In many cases, severance is either legally mandated or agreed upon in contracts with employees. You also have vendor bills, and of course, if you have a long-term lease, that obligation does not terminate just because the business has closed.

To put this in layman’s terms, if you rent an apartment and sign a two-year lease, you can’t move out in a year and stop paying. You still have that bill whether or not you live there.

In the case of Jack in the Box, the struggling restaurant chain announced plans to close 150-200 restaurants in April, 2025, when it introduced its “Jack on Track” plan. The chain has begun those shutdowns, but the closures are not happening as fast as expected, and you can blame lease obligations, according to management.

Jack in the Box explains shutdown plans

CFO Dawn Cooper explained where the company’s shutdown plans stand during its third-quarter earnings call.

“We have closed 40 restaurants year-to-date and expect to close an additional 10 to 20 during the fourth quarter,” she said.

More Restaurants:

52-year-old international restaurant chain closing all locations

46-year-old casual dining chain closes underperforming locations

Classic burger chain has closed down all its restaurants

That’s behind where the company expected to be.

“While closures have occurred a bit slower than we had anticipated, franchisees have increased their willingness to close ahead of franchise agreement expiration to focus on higher-performing restaurants and improve margins of their portfolio,” she added.

Leases, however, have delayed some locations from closing.

“We’ve said that the closures have occurred at a slower pace than we had expected, and that’s due to the lease obligation that remains once the restaurant is closed. Sometimes that burden is more than the loss they incur for operating the restaurant,” she shared.

Jack in the Box, however, is taking steps to speed up the process.

“That being said, we have hired a third-party firm to work with us on exiting the leases. They are currently working through the list of restaurants, prioritizing, and are up and running,” she added. “So we do expect that the closure rate will accelerate.”

Hopper also said more restaurants would likely close, but the company was still evaluating, since Jack in the Box has reported same-store losses for four additional quarters since Jack on Track was announced.

“I think the restaurants that we didn’t close in ’26, you can expect to carry forward into ’27, and I would expect elevated closures to continue into ’28,” she shared.

Jack in the Box is expanding the timetable for its restaurant closures.Shutterstock

Jack in the Box has a perception problem

In college, we went to Jack in the Box as a late-night indulgence. It was a fourth meal or a splurge, much like Taco Bell, and the chain has leaned into that over the years.

Jack in the Box has a problem caused by its menu and marketing history. The restaurant brand has, over the years, leaned into the idea of offering decadent food. It has also emphasized its late-night operating hours.

The chain, for example, offered “Snoop’s Munchie Meal,” a limited-time offer that made a not-so-subtle nod to people eating indulgently after smoking marijuana.

“Late at night, indulgence is key, so we focus on bringing back fan-favorite items at just the right moments — like Monster Tacos during Halloween — to create excitement and give our guests something to look forward to,” former Jack in the Box Chief Customer Officer Ryan Ostrom told QSR Magazine.

That perception may be a drag on the brand in the current GLP-1 era.

“You cannot force a customer to see Jack in the Box as not being a guilty pleasure,” RTMNexus CEO Dominick Miserandino told TheStreet.He thinks the chain can lean into its reputation and give consumers what they want.

“Today’s consumer wants real food and high protein, even when they are pulling into a drive-thru late at night after a few drinks. They should be launching ultra-premium, high-protein versions of their classic tacos, or adding real, whole-muscle chicken strips to their midnight menu,” he said.It’s a subtle but meaningful change that celebrates the brand’s history while embracing current trends.“By making the late-night indulgence feel higher quality and more filling, they give the consumer a reason to justify the trip without alienating the loyal audience that built the brand,” he added.

Related: Kroger has a customer problem that may be its own fault

Back-to-school season brings a lot of stress. 

Between changing daily routines, coordinating new schedules, shopping for supply lists, and figuring out how to pay for it all, the return to school can be more demanding for parents than students. 

In fact, one study by Life360 found that 68% of parents feel burdened by the sheer number of back-to-school tasks they have to complete, and another 60% report being reduced to tears due to the pressures of back-to-school preparation.

This year, DoorDash is committed to helping reduce that stress, partnering with several iconic brands to make back-to-school shopping easier than ever.

DoorDash partners with new retailers 

In August, DoorDash revealed it would partner with several quintessential back-to-school retailers just in time for the 2026-2027 school year.

Shoppers can now add items from Gap, Gap Factory, Kohl’s, Carter’s, and Barnes & Noble to their carts. 

The delivery platform says the move is designed to “give parents and students back the time they’d otherwise spend running between stores, with school clothes, supplies, classic and new reads, and everyday kids’ essentials all delivered to their door.”

“Back-to-school is one of those seasons where there’s just no time to plan every trip. As a dad, I know how this goes. It’s the sports uniform you realize is missing the night before practice, or the notebook nobody remembers until they’re already out the door,” Mike Goldblatt, vice president of Enterprise Partnerships at DoorDash, said in a statement. 

For the retailers, the partnerships offer another opportunity to expand their reach and build trust with consumers.

“We’re focused on creating seamless experiences that bring customers closer to the products they love,” said Gap Brand CEO Mark Breitbard in a press release. “Partnering with DoorDash extends the reach of Gap and Gap Factory, combining iconic style with the convenience and immediacy that our customers expect.”

Retail convenience is becoming a competitive advantage

Convenience and immediacy have become deciding factors for many consumers when considering where to make a purchase.

“The near-instantaneous gratification of online retail has evolved from amenity to necessity for many shoppers,” a report from Morgan Stanley says.

That same report found that 77% of consumers cited convenience (comfort, speed, accessibility, and availability) as a key factor when making purchasing decisions.

More retail news:

Walmart makes key move to compete with Amazon

Home Depot faces uphill battle amid a growing customer problem

Sportswear giant ends 10-year partnership amid store closures

“Consumers are willing to pay up to 5% more, on average, for convenience, and they will, in many cases, choose one product or service over another if it is more convenient,” said Morgan Stanley U.S. Thematic Strategist Michelle Weaver.

“We believe companies selling products or services to simplify consumers’ lives or make the purchasing process itself easier will see the most benefit from the convenience premium.” 

DoorDash, which is available in 22,000 zip codes and provides fast third-party delivery for 60% of the U.S. population (as of the first quarter of 2026), is one of the leading convenience platforms. 

For brands like Gap, Kohl’s, and Barnes & Noble, partnering with DoorDash offers a way to capitalize on the convenience premium. They can immediately expand their accessibility without sinking millions of dollars into building a delivery network of their own. 

And the more convenient the retail option, the more likely shoppers are to choose it over competitors, particularly during a hectic season when parents are juggling dozens of competing demands.

DoorDash has partnered with new retailers, including Gap, Kohl’s, Carter’s, and Barnes & Noble, to make back-to-school shopping more convenient.Getty Images

DoorDash’s push to become your convenience destination

DoorDash first launched back in 2013 as a restaurant delivery platform. But over the last few years, the company has rapidly expanded beyond food delivery into everyday retail.

From the outside, it appears that the platform is working to establish itself as the place consumers go when they need something quickly, whether that be dinner or an outfit for the first day of school.

Amazon may have cornered the market on one-day delivery, but its same-day and immediate delivery offerings haven’t necessarily made it the default choice for consumers who need something within the next few hours. 

That leaves an opening for DoorDash to position itself as the go-to platform for those last-minute purchases.

DoorDash’s back-to-school push is therefore about more than helping parents grab those last-minute supplies and outfits. 

It’s a bet that convenience (especially at particularly stressful points of the year) will prove so valuable that it can turn its platform into an everyday shopping destination.

Related: Home Depot is making a big bet on cautious consumers

The Los Angeles Dodgers’ star shortstop offered a “tough” response on his teammate’s slump after signing a $240 million deal.

The Treasury Department and IRS proposed regulations on Aug. 19 that would block an estimated 200,000 to 700,000 noncitizen filers from receiving refund checks tied to four federal tax credits: the earned income tax credit, child tax credit, adoption tax credit, and American opportunity tax credit. 

The rule would reclassify the refundable portions of these credits as federal public benefits under the 1996 welfare reform law known as Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA). 

Projected savings range from $700 million to $2.6 billion for 2026 alone. The rule is not final, but filers using Individual Taxpayer Identification Numbers (ITINs) instead of Social Security numbers already face a potential eligibility shift.

How refundable credits would be reclassified as federal public benefits

Under current IRS practice, refundable tax credits have not been treated as “federal public benefits” under PRWORA of 1996.  

The proposed regulations change that, drawing on a Justice Department Office of Legal Counsel analysis concluding these four credits meet the statutory definition, Accounting Today reported. 

Scott Bessent, Treasury Secretary, said the regulations protect taxpayer dollars from unauthorized benefit claims.

Related: Bessent says Treasury changing who’s eligible for tax-credit refunds

“American taxpayers should not be forced to foot the bill for benefits going to those who are barred by law from receiving them,” Bessent said. “These proposed regulations end the abuse, protect the integrity of the tax system, and put Americans first.”

Only the refundable portion is affected, the amount exceeding a filer’s tax liability that gets paid as a cash refund. Filers who do not qualify as “qualified aliens” could still use the non-refundable portion to offset taxes owed. 

Anyone claiming the refundable portion must declare eligibility under penalty of perjury. On joint returns, only one spouse must meet the citizenship or qualified-alien threshold, Accounting Today reported.

4 tax credits worth thousands face a new eligibility barrier

The proposed rule covers four refundable tax credits that collectively served about 24 million taxpayers in recent years, The Center Square reported.

4 credits affected by the proposed rule

Earned income tax credit (EITC): Targets low-to-middle-income workers. Worth up to $8,046 for filers with three or more qualifying children for the 2025 tax year, the IRS confirmed.

Child tax credit (CTC): Worth up to $2,200 per qualifying child for 2025, with the refundable additional child tax credit capped at $1,700, the IRS noted.

American opportunity tax credit (AOTC): Covers higher education costs, worth up to $2,500, with 40% (up to $1,000) refundable.

Adoption tax credit: Worth up to $17,280 per eligible child for 2025, with up to $5,000 refundable, a refundable portion added by the OBBBA and effective for tax year 2025, the IRS confirmed.

The premium tax credit under the Affordable Care Act (ACA) was excluded from the proposal. The Treasury acknowledged that Congress built separate immigration restrictions into the ACA, Accounting Today reported.

Four major refundable tax credits could face new eligibility restrictions.Weedezign / Getty Images

DACA recipients, TPS holders, and asylum applicants could lose refund checks

The term “qualified alien” under PRWORA is narrowly defined. It covers lawful permanent residents, granted asylums, refugees, parolees admitted for at least one year, and certain battered noncitizens. 

It excludes pending asylum applicants, Deferred Action for Childhood Arrivals (DACA) recipients, those with Temporary Protected Status (TPS), and many visa holders.  

In 2023, there were 2.6 million asylum applicants, 650,000 people under TPS, and 600,000 DACA enrollees, The Hill reported, citing Pew Research Center data. 

More IRS:

The final word on this year’s tax refunds just came in

IRS rules may fail to protect Americans from one AI tax risk

Roth catch-up mandate reshapes 401(k)s for high earners in 2026

Some noncitizens with Social Security numbers who are authorized to work in the U.S. could also lose access to these credits, Margot Crandall-Hollick of the Urban-Brookings Tax Policy Center told CNBC. 

The number of undocumented workers filing federal returns has likely dropped since then due to the administration’s immigration crackdown.

The rule draft’s own estimate of 200,000 to 700,000 affected filers represents fewer than 3% of total claimants, The Hill noted.

From executive order to tax code enforcement

The proposed rule is the latest step in a policy chain that began with a February 2025 executive order directing federal agencies to identify programs providing financial benefits to undocumented immigrants. 

Congress followed with the One Big Beautiful Bill Act, signed into law in July 2025, which narrowed eligibility for programs including Medicaid, Medicare, ACA premium tax credits, Supplemental Nutrition Assistance Program (SNAP), and the child tax credit, Mark Greenberg, an immigration expert at the Brookings Institution, noted in the CNBC piece. 

The Treasury and IRS proposal now extends that effort into the tax code itself. The tax proposal fits within a broader push “to restrict immigrants’ access to public benefits,” Greenberg wrote in a July 24, 2026, analysis, CNBC reported.

A 45-day comment window before final rules are drafted

The proposed regulations are now in a public comment period. Written or electronic comments and requests to speak at the public hearing must be received by October 5, 2026, the Federal Register entry confirmed.

A public hearing is scheduled for Oct. 14, 2026, and if finalized this year, the regulations would apply to tax returns for the 2026 tax year, filed in early 2027. The Treasury and IRS will consider public comments before issuing final rules.

What ITIN filers face before the next filing season

The rule has not taken effect, but the refundable versus non-refundable distinction now has real weight. Filers using ITINs instead of Social Security numbers face a potential eligibility shift. 

The rule must still survive its comment period, and its final form remains uncertain. Filers would need to attest to eligibility under penalty of perjury, but the IRS has not clarified whether additional verification methods will follow. 

Data-sharing with the Department of Homeland Security remains a possibility. Mixed-status households face particular complexity, one spouse may qualify while the other does not, leaving filing implications for these families unresolved.

Related: IRS has good tax deduction news for workers

Mortgage rates have hovered in the mid- to high-6% range for about three months. As of Aug. 20, the average 30-year fixed mortgage rate was 6.65%, according to Freddie Mac data.

So, if you’re a homeowner interested in taking out a home equity line of credit (HELOC), you’re probably expecting your interest rate to be somewhere around 6.65%, right?

Actually, the national average HELOC rate is 7.31%, based on Bankrate data from Aug. 19.

You might be surprised — even annoyed — that you’d pay a higher interest rate on a HELOC than on a primary mortgage.

But you might be even more surprised to know that 7.31% is an excellent HELOC rate right now. Especially considering how high 30-year fixed rates are.

Why? Because interest rates for first mortgages and second mortgages (which is what a HELOC is) are not based on the same factors. And HELOC interest rates and 30-year fixed rates are typically very different.

Why HELOC rates are usually higher than 30-year mortgage rates

Even though HELOCs and primary mortgages are both types of home loans, they’re impacted by different factors.

HELOC rates are primarily tied to the prime rate, which moves with the federal funds rate. Fixed mortgage rates, meanwhile, are influenced heavily by the 10-year Treasury yield.

“Most HELOCs have variable rates tied to the prime rate, so changes in the Federal Reserve’s interest rate can have a more direct impact on what borrowers pay,” Roger Boschulte, head of home lending products at Bank of America, told TheStreet.

“Traditional mortgages typically have fixed rates that are influenced by longer-term market conditions,” Boschulte continued. “That’s why homeowners may see mortgage rates move one way while HELOC rates move differently or change at a different pace.”

Related: Bank of America names HELOC risk homeowners should know

The prime rate is typically set around 3% above the federal funds rate.

The target range for the federal funds rate has been 3.5% to 3.75% since December 2025. Add 3%, and you get 6.5% to 6.75% (the actual current prime rate is 6.75%). This is below the average HELOC rate, but you might qualify for a lower rate if you have stellar credit.

“While the Fed’s rate decision may impact fixed mortgage rates, it is not the only determining factor,” Erik Schmitt, head of consumer direct sales at JPMorganChase, told TheStreet.

Various factors affect fixed mortgage rates, especially the 10-year Treasury yield. There’s usually a 1.5% to 2% spread between the 10-year yield and the 30-year fixed rate.

The 10-year yield closed at 4.69% on Aug. 20. The average 30-year fixed mortgage rate was 6.65%. That’s a spread of 1.96%.

HELOC interest rates are directly impacted by the prime rate and federal funds rate. Rates on 30-year mortgages are affected by the 10-year Treasury yield. And that’s why the rates are different.

Homeowners should expect to pay higher interest rates on HELOCs than on primary mortgages.MoMo Productions / Getty Images

7.31% is actually a good HELOC interest rate

A 7.31% HELOC rate may look high next to today’s 6.65% mortgage rate. But historically, it’s actually a relatively low HELOC rate.

To get a better idea of how HELOC rates might typically work, let’s use January 2024 as an example.

In the first week of 2024, the average Freddie Mac 30-year fixed mortgage rate was 6.62%. Meanwhile, the average HELOC rate was 10.16%, according to Bankrate data.

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HELOC vs. Cash-out refinance: Costs & tradeoffs

The 30-year mortgage rate was almost identical to today’s rate, but the HELOC rate was much higher. In January 2024, the gap between the average 30-year fixed rate and the average HELOC rate was 3.54%. In August 2026, it was just 0.66%.

So, even though mortgage rates have been stubbornly high so far in 2026, HELOC rates are actually relatively low.

In January 2024, the prime rate was 8.5%, according to JPMorganChase reporting. In August 2026, it’s 6.75%. So, it makes sense that HELOC rates aren’t increasing at the same pace as primary mortgage rates.

Key takeaways: What to know about current HELOC rates

HELOC rates should stay low as long as the federal funds rate and prime rate remain unchanged. If you’re seriously considering a HELOC, today’s low interest rates could be the push you need.

“After the Fed chose to keep the prime rate unchanged last month, our HELOC rates are closer to par with our mortgage rates, giving customers additional borrowing options and reinforcing the appeal of HELOCs for homeowners looking to access equity without refinancing an existing mortgage,” Wendy Morrel, head of relationship retail and home equity strategist with U.S. Bank, told TheStreet.

However, the Fed could increase the federal funds rate. The likelihood of a rate hike at its September meeting is dwindling, but it will probably raise rates at some point.

And that future hike will affect people with HELOCs. Interest rates on HELOCs are typically variable, meaning they adjust periodically. So if the federal funds rate and the prime rate go up, your HELOC rate could, too.

Getting a HELOC is like buying a house or trading stocks. You can’t time it perfectly, and there’s no crystal ball to know what rates will do in the future.

If you’ve already been considering a HELOC, today’s rates are relatively favorable compared with recent years. But the right time to borrow depends on your financial situation, how much equity you have, and what you’ll use the money for — not just the rate.

Related: HELOC vs. home equity loan: Which is better for your situation?