Daily Tax Update - November 19, 2009

REID INTRODUCES $849 BILLION SUBSTITUTE HEALTH CARE BILL: Last night, Senate Majority Leader Harry Reid introduced a 2,074-page substitute Senate health care bill “The Patient Protection and Affordable Care Act.” Reid needs 60 votes to overcome an expected Republican filibuster attempt and open Senate debate on the bill. It would take another 60 votes to close debate, while final approval of the bill would require only a simple majority. The bill would reduce the deficit by $127 billion over a decade. A procedural vote may occur this weekend.

• The bill would create a new government-run insurance plan to compete with private insurers, but would allow the states to opt out of participating. The bill is paid for in part through (1) Medicare cuts, (2) an increase in the Medicare payroll tax for individuals making $200,000 or more and couples earning $250,000 or more to 1.95 percent, and (3) a tax on high-cost “Cadillac” insurance plans valued at $8,500 for individuals and $23,000 for families. The bill includes a new 5-percent excise tax on elective cosmetic surgeries as well as fees on drug makers and medical device manufacturers.
• Senate Budget Ranking member Judd Gregg said, “The healthcare reform plan revealed...reaffirms the intentions of the majority party in Congress to grow the size of our government exponentially, explode federal spending, and provide lower quality, government-run health care for all Americans. Though this plan may claim to be deficit-neutral, it uses sleight-of-hand budgetary tricks by assuming unrealistic tax increases and Medicare cuts that members of Congress will not be willing to follow through on.”
• The text of the bill can be accessed here. 

MISCELLANEOUS GUIDANCE ISSUED TODAY:
Notice 2009-93 creates a pilot program allowing filers of information returns to truncate an individual payee’s nine-digit identifying number on paper payee statements for calendar years 2009 and 2010 if the filers meet the requirements set forth in this notice.

TAX BILLS INTRODUCED NOVEMBER 18^TH:
H.R.4100: To amend the Internal Revenue Code of 1986 to provide individual and corporate income tax relief, to reduce the employee share of payroll taxes, and to rescind unobligated stimulus funds, and for other purposes.
Sponsor: Rep Broun, Paul C. [GA-10] (introduced 11/18/2009)      Cosponsors (9)

H.R.4109: To amend the Internal Revenue Code of 1986 to allow the low income housing credit to be carried back 5 years, and for other purposes.
Sponsor: Rep Pascrell, Bill, Jr. [NJ-8] (introduced 11/18/2009)      Cosponsors (None)

H.R.4112: To amend the Internal Revenue Code of 1986 to modify the requirements for windows, doors, and skylights to be eligible for the credit for nonbusiness energy property.
Sponsor: Rep Yarmuth, John A. [KY-3] (introduced 11/18/2009)      Cosponsors (7)

S.2794: A bill to amend the Internal Revenue Code of 1986 to provide tax incentives for the donation of wild game meat.
Sponsor: Sen Schumer, Charles E. [NY] (introduced 11/18/2009)      Cosponsors (None)

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
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