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2010 Hiring Incentives to Restore Employment Act |
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March 10, 2010 The Senate approved a nearly $140 billion "tax extenders" package on March 10 by a vote of 62 to 36. The American Workers, State and Business Relief Act of 2010 (H.R. 4213) extends a host of popular but temporary individual, business, charitable, and energy tax incentives through December 31, 2010. The Senate bill also extends eligibility for COBRA premium assistance through December 31, 2010, provides for pension funding relief, allows workers over age 59-1/2 to convert 401(k) distributions to Roth 401(k) plans, and adds a technical modification to the popular first-time homebuyer tax credit, among its list of changes. The Senate extenders bill is partially paid for by codification of the economic substance doctrine and reform of the cellulosic biofuel producer credit.
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Obama Unveils $3.83 Trillion Budget; Tax Proposals Focus On Job Creation, Revenue |
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February 5, 2010 President Obama presented Congress with his fiscal year (FY) 2011 federal budget proposals on February 1, and the $3.83 trillion budget emphasizes job creation and deficit reduction. Tax incentives for individuals and businesses total approximately $300 billion with an additional $100 billion allocated to job creation. On the other hand, proposed tax increases would raise $1.4 trillion. Although rate increases for higher-income taxpayers would bring in the lion’s share of that revenue, the budget calls for over $450 billion in other revenue raisers. Those increases impact many categories of taxpayers but, perhaps most directly, those with international operations.
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IRS Unveils Comprehensive Preparer Reform Blueprint |
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January 14, 2010. After six months of internal study, review of hundreds of comments and a series of public meetings, the IRS has announced a sweeping reform of return preparer oversight. All paid signing preparers, regardless of credentials or licenses, will be required to register with the IRS. Unenrolled preparers will be required to complete competency testing and mandatory continuing education. On January 4, the IRS released a blueprint of its new preparer initiative and indicated that regulations necessary to implement the changes would be released in 2010.
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House-Passed Extenders/Jobs Bills Await Senate Action in 2010 |
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December 28, 2009. The House of Representatives approved a package of tax extenders on December 9, 2009, by a largely party-line vote of 241 to 181. The $31 billion Tax Extenders Act of 2009 (H.R. 4213) extends more than 50 popular, but temporary, tax incentives through December 31, 2010. Two revenue raisers - a change in the taxation of carried interest and heightened information reporting and disclosure requirements for foreign bank and financial accounts - would pay for the one-year extensions.
Read CCH's Special Tax Briefing PDF For Full Coverage
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House Passes Extenders Bill With Carried Interest, Foreign Reporting Revenue Raisers |
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December 10, 2009. The House of Representatives approved a package of tax extenders on December 9, 2009, largely along party lines by a vote of 241 to 181. The $31 billion Tax Extenders Act of 2009 (H.R. 4213) extends more than 50 popular but temporary tax incentives through December 31, 2010. Most of the incentives would have expired after December 31, 2009. Two revenue raisers – a change in the taxation of carried interest and heightened information reporting and disclosure requirements for foreign bank and financial accounts – would pay for the one-year extensions. President Obama has indicated he will sign the extenders bill as passed by the House, but the bill’s fate is uncertain in a Senate focused almost exclusively on heath care reform.
Read CCH's Special Tax Briefing PDF For Full Coverage
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Senate Health Bill Calls For Excise Tax On Insurance Plans, Added Payroll Tax On High-Wage Earners |
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November 19, 2009. Health care reform took another major step forward on November 18 when Senate Democratic leaders unveiled the Patient Protection and Affordable Care Act. The bill is a blended version of bills passed earlier by the Senate Finance Committee (SFC) and the Senate Health, Education, Labor, and Pensions (HELP) Committee. The $849 billion package, with $370 billion in revenue raisers, was drafted not only with an eye toward garnering the 60 votes necessary for full Senate approval but also in preparation for conference committee negotiations. Although the Senate bill is similar in scope to the House-passed Affordable Health Care for America Act (H.R. 3962) many differences remain, especially over revenue raisers.
Read CCH's Special Tax Briefing PDF For Full Coverage
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Worker, Homeownership, and Business Assistance Act of 2009 |
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November 6, 2009. Two popular but temporary tax incentives have been given a new lease on life as part of legislation extending unemployment compensation benefits. The Worker, Homeownership, and Business Assistance Act of 2009 (H.R. 3548), signed into law by President Obama on November 6, 2009, extends those incentives and more. Following several weeks of negotiations, the new law was approved in rapid-fire succession, first by the Senate, 98-0,on November 4 and then by the House,403-12, on November 5.
Read CCH's Special Tax Briefing PDF For Full Coverage
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President-Elect Obama Brings Ambitious Tax Policy Agenda to Washington |
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December 4, 2008. On January 20, 2009, Barack Obama will take the oath of office as the 44th president of the United States. Federal tax policy is guaranteed to be at the forefront of President Obama's agenda. Democrats in Congress are preparing an economic stimulus package, which they hope to have ready for the new president's signature on January 20. It is likely to include significant individual and business tax incentives. The stimulus package may also include tax incentives for individuals and businesses to "go green" along with a huge infusion of federal funds for state and local infrastructure spending.
The president-elect is counting on a stimulus package large enough to jolt the economy out of what some are calling the worse slowdown since the 1930s. One way to jump start the economy in the view of the incoming administration is to get more money into taxpayers' hands, thereby increasing the consumer spending needed to drive the economy.
Read CCH's Special Tax Briefing PDF For Full Coverage
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Presidential Candidates Outline Tax Policies |
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September 18, 2008. As the U.S. prepares to elect its 44th president, tax and accounting professionals and their clients are looking for details about the tax policies of the candidates of the two major parties. This special CCH Briefing describes the tax policies of John McCain, the Republican Party candidate for president, and Barack Obama, the Democratic Party candidate, with analysis of the potential impact of their tax policies.
Whoever is elected on November 4 will likely unveil his tax policies soon after taking office so Congress can begin holding hearings and drafting legislation. Once Congress begins its work, practitioners and taxpayers can expect to see more details about changes in federal tax policy. The track record for newly-elected presidents to get a large tax bill passed during their first year in office is good. That makes 2008 year-end tax planning especially challenging and urgent since the door may close after this year on many current tax breaks.
Read CCH's Special Tax Briefing PDF For Full Coverage
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Congress Enacts Farm Bill Overriding Bush Veto And Passes Military Tax Relief |
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May 22, 2008. The Food, Conservation, and Energy Act of 2008 (H.R. 2419), also known as the Farm Bill, has finally been enacted into law.
The Senate on May 22 successfully overrode President Bush's May 21 veto of the bill by a convincing 82-13 vote. The House overrode the veto the day earlier immediately after the president's veto by a lopsided margin of 316-108.
Due to an enrollment error, however, the legislation contained only 14 of the 15 titles when the House and Senate adopted the conference report on the bill on May 14 and 15, respectively.
Nevertheless, the tax title was included in the legislation sent to the President and in the override votes by Congress. It is not clear at press time if the procedural mix-up will result in litigation challenging the legislation.
Read CCH's Special Tax Briefing PDF For Full Coverage
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Senate Passes Jobs Bill With Hiring Incentives, Expensing Extension |
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Updated: February 24, 2010 Confronted with stubbornly high unemployment numbers and a slow economic recovery, the Senate on February 24 voted 70 to 28 to approve a $15 billion jobs bill, the Hiring Incentives to Restore Employment (HIRE) Act, H.R.2847. The HIRE Act provides new incentives for hiring and retaining workers, along with a one-year extension of enhanced Code Sec. 179 expensing and changes to Build America Bonds. The HIRE Act is partially offset by a package of new foreign account tax compliance rules. The HIRE Act does not include extenders, COBRA premium assistance or an estate tax extension.
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New Law Allows 2010 Haiti Relief Contribution Deductions On 2009 Returns |
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Updated January 25, 2010. Taxpayers making charitable cash contributions in early 2010 to help Haiti after the devastating January 12 earthquake can claim a deduction on their 2009 federal tax returns. The House of Representatives unanimously passed H.R. 4462 on January 20 to allow taxpayers to claim a charitable deduction on their 2009 returns for qualified Haiti disaster relief contributions made after January 11, 2010 and before March 1, 2010. The Senate approved the measure on January 21, and President Obama promptly signed it into law on January 22.
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Senate Passes Health Care Reform Legislation |
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December 28, 2009. By a vote of 60-39, the Senate approved a massive health care reform bill on December 24, 2009 with over $390 billion in revenue raisers and new taxes on employers and individuals. The Patient Protection and Affordable Care Act (H.R. 3590) is a version of bills passed earlier by the Senate Finance Committee (SFC) and the Senate Health, Education, Labor, and Pensions (HELP) Committee. Although the Senate bill is similar in scope to the House-passed Affordable Health Care for America Act (H.R. 3962) many differences remain, especially over revenue raisers.
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Estate Tax Extension Passes House, Fails In Senate; Carryover Basis To Be Effective January 1, 2010 |
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December 28, 2009. On December 3, the House approved the Permanent Estate Tax Relief for Families, Farmers and Small Businesses Bill of 2009 (H.R. 4154), which would permanently extend the top federal estate tax rate of 45 percent with a $3.5 million exclusion ($7 million for married couples who fully utilize their exclusions). The House Bill also provides for continuation of the gift and generation-skipping transfer (GST) tax provisions as they exist in 2009. However, after several year-end parliamentary maneuvers, the bill failed to win support in the Senate, as did a temporary stop-gap measure to extend the 2009 estate tax regime through March 2010.
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House Passes Permanent Estate Tax Relief Bill; Fate in Senate Uncertain |
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December 4, 2009. The House on December 3, 2009, passed long-awaited legislation, the Permanent Estate Tax Relief for Families, Farmers and Small Businesses Bill of 2009 (H.R. 4154), permanently extending the top federal estate tax rate of 45 percent with a $3.5 million exclusion ($7 million for married couples who fully utilize their exclusions). The 225 to 200 vote reflected the urgency felt by some House lawmakers to provide certainty to estate planning planning and disagreement over whether to abolish the tax entirely or provide for a lower exclusion. The House Bill also provides for continuation of the gift and generation-skipping transfer (GST) tax provisions as they exist in 2009. The $233 billion cost over 10 years of the House Bill is not offset.
Read CCH's Special Tax Briefing PDF For Full Coverage
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House Passes Higher-Income Surtax,New Limits On FSAs, and More To Fund Health Care Reform |
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November 9, 2009. Health care reform took a major step forward late on November 7 when the House passed, 220-215,a mammoth 2,000+ page bill overhauling health insurance coverage for Americans.The Affordable Health Care for America Act (H.R. 3962) imposes a new surtax on higher-income individuals expected to raise more than $400 billion over 10 years to help pay for nearly universal coverage.
Read CCH's Special Tax Briefing PDF For Full Coverage
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Treasury Releases "Green Book" of Tax Proposals |
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May 14, 2009. The Obama administration released much-anticipated details about its proposed tax cuts and revenue raisers on May 11. The Treasury Department's General Explanations of the Administration's Fiscal Year 2010 Revenue Proposals (also known as the "Green Book") describes the administration's tax agenda, including permanent Making Work Pay, American Opportunity and research credits; a package of international tax reforms; reinstatement of the 36 and 39.6 percent individual marginal income tax rates; expanded information reporting; and automatic enrollment in IRAs. According to the Treasury, the proposals would generate $736.5 billion in savings for individuals (largely aimed at middle income taxpayers) and $71 billion in long-term savings for businesses. Revenue raisers would bring in roughly $900 billion.
Read CCH's Special Tax Briefing PDF For Full Coverage
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Congress Passes Emergency Pension Tax Relief/Technical Corrections |
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December 11, 2008. In response to the continuing drumbeat of bad economic news, Congress passed the Worker, Retiree, and Employer Recovery Act of 2008 (H.R. 7327), suspending required minimum distributions (RMDs) from 401(k) plans, IRAs and similar retirement accounts for 2009, providing pension pension plan funding relief, and including technical corrections to the Pension Protection Act of 2006. A $14 billion automaker rescue package, passed by the House on December 10, appears to be stalled in the Senate at this time. The White House has indicated that President Bush will sign the Worker, Retiree, and Employer Recovery Act as soon as it reaches his desk.
Read CCH's Special Tax Briefing PDF For Full Coverage |
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President Signs Financial Markets Rescue Plan, AMT Patch, Extenders, Disaster Relief and More |
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October 3, 2008. President Bush signed the historic Emergency Economic Stabilization Act of 2008, on October 3, 2008; the same day that the House passed the legislation by a vote of 263 to 171. The House vote came just two days after the Senate passed the measure by a vote of 74 to 25, and four days after the House failed to pass a similarly title bill.
The landmark legislation gives the Treasury $250 billion immediately, and requires the president to certify if an additional $100 billion is necessary. An additional $350 billion may be disbursed subject to Congressional approval. The Treasury Department is required to report on the use of the funds and progress made in addressing the crisis. An oversight board and a special inspector general will also be created to watch over the Treasury department
Read CCH's Special Tax Briefing PDF For Full Coverage
Special Resources from CCH for Tax Legislation
For additional CCH tax legislation resources, including white papers on the sub-prime lending crisis and SEC rules on short selling, please visit: http://www.cch.com/rescue/
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President Signs the Housing and Economic Recovery Act of 2008 |
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Updated July 30, 2008. Reacting to the continuing slump in housing sales, along with rising unemployment numbers and weakness in the credit markets, Congress passed the Housing and Economic Recovery Act of 2008 (H.R. 3221). Although the tax provisions are only one part of the larger American Housing Rescue and Foreclosure Prevention Act, they make significant changes.
The tax title includes $15.1 billion in tax incentives that are fully offset by far-reaching revenue raisers. While the tax incentives are targeted principally to home ownership and affordable housing, the offsets are collected from a variety of sources. New provisions that require credit card purchase information reporting by merchants and close a home sale exclusion loophole for vacation and rental property are among the more prominent offsets that will require a shift in tax strategies.
President Bush signed the bill into law on Wednesday, July 30, 2008.
Read CCH's Special Tax Briefing PDF For Full Coverage
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President signs Economic Stimulus Act of 2008 With Rebates and Business Incentives |
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Updated February 13, 2008. President Bush signed into law the Economic Stimulus Act of 2008 (HR5140). The legislation, estimated to cost $125 billion over a ten-year period, includes a recover rebate credit for 2008.
In addition to rebates, the new law includes $44.8 billion in business incentives that include generous expensing and bonus depreciation allowances, as well as additional help for homeowners facing foreclosure because of the mortgage meltdown.
Read CCH's Special Tax Briefing PDF For Full Coverage |
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President Bush Signs Small Business and Work Opportunity Tax Act of 2007 |
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Updated May 29, 2007. Following months of political wrangling, President Bush signed on May 25, 2007 the Small Business and Work Opportunity Tax Act of 2007, which is part of a much larger and more controversial bill, the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act of 2007 (H.R. 2206).
The legislation passed the House by a 280-142 vote on May 24, 2007, followed the same day by Senate approval by a 80 to 14 margin.
The new tax law targets nearly $5 billion in tax incentives principally to small businesses but also to some larger ones. It also includes tax incentives to help taxpayers recovering from Hurricane Katrina, as well as an important package of S corporation reforms.
However, unlike past tax bills, the revenue raisers that mean more taxes for certain taxpayers are significantly fewer in number; although one - an expansion of the kiddie tax to apply to children who are 18 years old or who are full-time students up to age 24 - will impact millions of families.
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