Daily Tax Update - March 06, 2006

March 6, 2006

TREASURY, IRS RELEASE UPDATE OF THE 2005-2006 PRIORITY GUIDANCE PLAN:
Today, the Treasury Department and IRS released the first periodic update of the 2005-2006 Priority Guidance Plan. According to the Treasury Deparment, "The attached update sets forth the guidance on the original 2005-2006 Priority Guidance Plan that we have published. Although the update may indicate that a particular item on the plan has been completed, it is possible that one or more additional projects may be completed in the plan year relating to that item. The update also includes 58 items of additional guidance, some of which have already been published."

  • The document can be accessed here.    

WAYS AND MEANS COMMITTEE CHAIRMAN WILL NOT SEEK REELECTION:
Today, House Ways and Means Committee Chairman Bill Thomas (R-CA) announced that he would not seek reelection to Congress. Under the House Republicans’ term limits for committee chairmen, Thomas could not continue to serve as chairman after this year. Thomas said, "One of the great honors I have received was being selected House Ways and Means Chairman in 2001, not because I was the first Californian to achieve this post, but because of the great challenge it offers to legislate in wide-ranging national issues.  We passed over $2 trillion in tax relief for hardworking American families, we provided the President with trade promotion authority so that he could seek freer and fairer trade markets, and we approved a long overdue voluntary prescription drug benefit in Medicare for the first time in the program's history. Over the next nine months, I intend to continue to work hard and finish my congressional term with the same vigor as my first.  Challenges lie ahead, and I intend to work hard to tackle the problems caused by our outdated entitlement programs and our currently flawed income tax structure."

IRS COMMISSIONER ISSUES STATEMENT ON TAX CONSEQUENCES OF OSCAR "GOODIE BAGS":
The IRS Commissioner reminded the Academy Award celebrities that the six-figure goodie bags handed out last night qualify as taxable income and must be reported on their tax returns.

  • IRS Commissioner Mark Everson said, "As the world watches the glamour and glitz of the Academy Awards, it’s important to keep in mind that movie stars face the same tax obligations as ordinary Americans. We want to make sure the stars ‘walk the line’ when it comes to these goodie bags." Everson added, "This has become big business for companies promoting their products. These things aren’t given without pride and prejudice. There is a tax implication for them. We just want to make sure no one crashes into the tax code."

TAX BILL INTRODUCED MARCH 3:

  • S.2366 sponsored by Sen. Blanche Lincoln (D-AR) would replace the recapture bond provisions of the low income housing tax credit program.

INTERNAL REVENUE SERVICE - CIRCULAR 230 DISCLOSURE:
As provided for in Treasury regulations, advice (if any) relating to federal taxes that is contained in this communication (including attachments) is not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any plan or arrangement addressed herein.

STEPTOE & JOHNSON LLP - TAX PRACTICE
Steptoe & Johnson LLP has one of the largest and most diverse law firm tax practices in the country. The practice covers the entire spectrum of federal taxation, including representation of businesses before the Congress, Treasury and the national office of the IRS; transactional planning for domestic and multinational corporations; complex audit and controversy work for corporations and other business interests contesting IRS adjustments; litigation before the Tax Court, Court of Federal Claims, district courts, courts of appeals and the Supreme Court. The firm's tax practice also encompasses all aspects of employee benefits (ERISA), executive compensation, tax-exempt organizations and charitable giving.  Steptoe has an extensive state and local tax practice, representing an array of business clients on complex sales and use tax, corporate income tax and property tax matters, both advising those clients and handling audits, administrative appeals, and litigation for them.  Read  more information on Steptoe's tax practice