House Republicans are heading into the new Congress with a lofty set of tax reform goals, an ambitious agenda made more difficult by a razor-thin majority.

Republicans are on track to have a single-digit-seat edge beginning in January, one that is set to get smaller as some members resign from the House to serve in President-elect Trump’s Cabinet.

That will make the heavy lift of tax reform even weightier for Republican leaders. A small but influential group of GOP lawmakers want to raise the state and local tax (SALT) deduction cap and are vowing to block any bill without their demand, and deficit hawks are sure to voice their concerns about the price tag.

Top Republicans say they are aware of those circumstances but are ready to take up the challenge head-on.

“That’s what the whole process is gonna be, threading that needle,” Rep. Jason Smith (R-Mo.), the chair of the House Ways and Means Committee, told The Hill. “But failure is not an option, we’ll get it done.”

Success, however, will require near-total agreement within the fractious Republican conference.

Republicans are set to control at least 220 seats next year, with Democrats trailing at 213 seats. Two elections in California remain uncalled, with Democrats currently holding a small lead in both, according to Decision Desk HQ.

That GOP majority, though, is set to narrow even further early next year, with Reps. Mike Waltz, R-Fla., and Elise Stefanik, R-N.Y., set to leave the chamber to serve in Trump’s administration and former Rep. Matt Gaetz, R-Fla., not taking the oath of office despite withdrawing from consideration for attorney general.

That ultrathin margin is set to come to fruition during the first 100 days of the Trump administration, when Speaker Mike Johnson, R-La., and other GOP leaders are hoping to use budget reconciliation — a tool parties that control all levers of government can utilize to fast-track their priorities — to extend the tax cuts Trump enacted in 2017.

Several provisions of the 2017 tax package — called the Tax Cuts and Jobs Act (TCJA) — expire at the end of 2025, including all the individual provisions.

Marginal income tax rates will jump from 12 to 15 percent, 22 to 25 percent, or 22 to 28 percent, depending on the tax bracket. The standard deduction will be cut in half for single filers, as will the individual child tax credit. Inheritance tax exclusions will drop from $10 million to $5 million.

Business taxes will also increase. For businesses that pass their tax liability through to their owners, which have proliferated in recent years, the 20-percent deduction will go away and normal individual income tax rates will apply.

Assuming all Democrats oppose the tax package, which is expected, Republicans will need to be almost completely united to clear the legislation, a reality that is emboldening GOP lawmakers in favor of lifting the SALT tax cap.

Members from higher-tax blue states like New York and California for years have pushed to remove or raise the SALT deduction cap, which was implemented as part of the 2017 Trump tax cuts. The legislation caps the SALT deduction at $10,000 for individuals and includes the so-called marriage penalty, which applies the $10,000 SALT deduction cap to married couples who file their taxes jointly and make less than $500,000 a year.

In 2017, 12 Republicans voted against the Trump tax cuts, all of whom were from California, New Jersey or New York. Just three of them, including Stefanik, will still be in the House in January.

Reps. Mike Lawler, R-N.Y., and Nick LaLota, R-N.Y., two members of the SALT Caucus, told The Hill in interviews that they will not support any tax package that does not reform the SALT deduction cap, and said their colleagues in the group will follow suit, a concerning sign for leadership.

“Certainly there’s broad consensus that as members of the SALT Caucus, we will not support a tax bill that does not address the issue of SALT,” Lawler said.

Both lawmakers — who are in their first term and won reelection last month — would not say what their ideal SALT reform looks like. LaLota, who represents parts of Long Island, introduced a bill last year that would increase the SALT deduction cap to $60,000 for individuals and $120,000 for married couples. Going forward, however, he said the numbers may be even larger.

“Higher is better, and $60,000 and $120,000 may have been last year’s price,” LaLota said. “And the price may have gone up.”

Smith told CNBC in a September interview that the SALT deduction will still have a cap, noting that an unlimited ceiling could not clear the GOP House. LaLota said leadership is “fully aware” of the group’s priorities, and discussions over the SALT deduction cap will continue.

SALT Caucus Republicans have pushed to increase the deduction cap throughout the 118th Congress, at times flexing their muscles and showing that the small group could derail legislation if its demands are not met — a potential foreshadowing for the 119th Congress.

In January, for example, four New York Republicans, including Lawler and LaLota, came close to torpedoing a procedural vote for an unrelated bill out of frustration that a bipartisan, bicameral tax deal did not include an increase to the SALT deduction.

The group ultimately voted in favor of the rule, allowing House business to proceed, but the episode showed the power their small group wields in the slim GOP majority. Roughly two weeks later the House moved to advance a bill that would have raised the SALT deduction cap, but a group of conservatives tanked that procedural vote.

This time around, however, SALT Caucus Republicans feel that they are in a better position to extract their demands after Trump voiced support for changing the deduction cap. In September — shortly before holding a rally at Nassau Coliseum on Long Island — Trump wrote on Truth Social “I will turn it around, get SALT back, lower your Taxes, and so much more.”

“It certainly strengthens our position,” LaLota said of Trump’s statement. “President Trump, a native New Yorker, understands the need for our high-tax state to have a higher SALT cap. And yes, it does strengthen our negotiating position that he made that promise on the campaign trail.”

In addition to SALT Caucus Republicans, hard-line conservatives concerned about the ballooning deficit could stymie passage of the forthcoming tax reform package. Rep. Chip Roy, R-Texas, for example, has frequently criticized implementing tax cuts without pay-fors, pointing to the mounting debt.

According to a projection from the Congressional Budget Office, extending the 2017 tax cuts could cost $4.6 trillion.

House and Senate negotiators are engaging in early discussions regarding how long Congress should extend the tax cuts, sources told The Hill, weighing different lengths based on their potential impacts on the federal deficit.

Support from those deficit hawks — similarly to SALT Caucus Republicans — could make or break a tax reform package in the House, giving the group outsized influence as leaders begin discussions over their highly anticipated legislation.

Adding a wrinkle to the Republican priority of extending the TCJA tax cuts is the fact that Trump promised a bevy of new tax cuts while on the campaign trail, including canceling taxes on tips and overtime, getting rid of double taxation for Americans living abroad, doing away with taxes on Social Security, and creating a deduction for auto loan interest — vows that will add to the package’s price tag.

According to one estimate by the Committee for a Responsible Federal Budget, Trump’s campaign plans could add as much as $8 trillion to the national deficit.

“Are we just gonna say every tax cut, no matter what it is, magically pays for itself? Let me give a little hint to Republicans: They don’t all pay for themselves. They don’t,” Roy said on the House floor in September. “It’s simple math. Some tax cuts do because they create economic growth, some tax cuts don’t.”

Tobias Burns contributed.