Daily Tax Update - October 2, 2009

FINANCE COMPLETES HEALTH CARE MARK UP – COMMITTEE VOTE EXPECTED NEXT WEEK: Early this morning, the Senate Finance Committee completed action on its health care reform plan. A vote in the Committee could occur as early as next Tuesday, after which the Finance version must be merged with another Senate Committee health care bill before it comes to the Senate floor for a vote.

• Included among the amendments adopted yesterday is a provision that would reduce the penalty excise tax on individuals who do not purchase insurance and delay its implementation date until 2014. The committee also adopted an amendment that would limit the ability of health insurance companies to use tax deductions for “excessive” levels of executive pay. The sponsor of the amendment, Sen. Blanche Lincoln, said, “My amendment evens the playing field so that consumers can be assured that health insurance company executives are not receiving a personal windfall from this new insurance coverage mandate. It is my hope that this amendment will encourage the insurance companies to put those additional premium dollars toward lower rates and more affordable coverage for consumers, not in their own pocketbooks.”
• The Committee is expected to post a detailed summary later via: http://finance.senate.gov/sitepages/baucus.htm

TAX BILLS INTRODUCED OCTOBER 1st:
H.R.3707: To amend the Internal Revenue Code of 1986 to exclude combat zone compensation of members of the Armed Forces from employment taxes.
Sponsor: Rep Garrett, Scott [NJ-5] (introduced 10/1/2009)      Cosponsors (None)

H.R.3708: To amend the Internal Revenue Code of 1986 to exclude from gross income the earned income of a spouse of a member of the Armed Forces of the United States serving in a combat zone.
Sponsor: Rep Garrett, Scott [NJ-5] (introduced 10/1/2009)      Cosponsors (None)

H.R.3715: To amend the Internal Revenue Code of 1986 to expand the rehabilitation credit, and for other purposes.
Sponsor: Rep Schwartz, Allyson Y. [PA-13] (introduced 10/1/2009)      Cosponsors (40)

H.R.3718: To amend the Internal Revenue Code of 1986 to make residents of Puerto Rico eligible for the refundable portion of the child tax credit.
Sponsor: Rep Towns, Edolphus [NY-10] (introduced 10/1/2009)      Cosponsors (9)

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.

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