Daily Tax Update - May 23, 2016: Senate Finance Committee Leaders Write Letter to Secretary Lew Regarding EU Tax Enforcement

Senate Finance Committee Leaders Write Letter to Secretary Lew Regarding EU Tax Enforcement:  Today, Senate Finance Committee Chairman Orrin Hatch (R-UT), Ranking Member Ron Wyden (D-OR), Senator Rob Portman (R-OH), and Senator Charles Schumer (D-NY) sent a letter to Treasury Secretary Lew regarding the European Commission’s state aid investigations of tax rulings given by member states to US companies or their subsidiaries.  The letter expresses concern that the rulings could lead to retroactive taxation on multinational enterprises.  The letter also says that the European Commission “appears to be asserting supremacy over and becoming the final arbiter of transfer pricing and other international tax determinations in the EU.”  They also point out that four of the five investigations of company-specific tax rulings involve US companies and that “encroachment on U.S. tax jurisdiction that results from these cases appears to be intentional.”   

House Small Business Committee to Hold Hearings on the Taxation of Entrepreneurs:  On May 24, 2016, the House Small Business Committee will hold a hearing titled “The Sharing Economy: A Taxing Experience for Entrepreneurs, Part I,” at 11 a.m. in Room 2360 of the Rayburn House Office Building.  The following witnesses are scheduled to testify:

  • Caroline Bruckner
    Executive-in-residence for accounting and taxation and managing director, Kogod Tax Policy Center, American University
  • Rob Willey
    VP of Marketing, TaskRabbit
  • Morgan Reed
    Executive Director of ACT, The App Association
  • Joe Kennedy
    Senior Fellow, Information Technology and Innovation Foundation

On May 26, the House Small Business Committee will hold Part II of that hearing, at 10 a.m. in Room 2360 of the Rayburn House Office Building.  The following witness will testify:

  • Nina Olson
    National Taxpayer Advocate, Internal Revenue Service

House Ways and Means Committee to Hold Hearing on Need For Tax Reform:  On May 25, the House Ways and Means Tax Policy Subcommittee will hold a hearing on “Perspectives on the Need for Tax Reform.”  The hearing will be held on May 25 at 2 p.m. in Room 1100 of the Longworth House Office Building.  The witnesses have not yet been announced.

Senate Finance Committee to Hold Hearing on Debt and Equity:  On May 24, the Senate Finance Committee will hold a hearing on “Debt and Equity: Corporate Integration Considerations.”  Click here for prior DTU coverage.  For the Joint Committee on Taxation’s Overview of the Tax Treatment of Corporate Debt and Equity, click here

DTU IN DEPTH

Proposed Regulations for Foreign-Owned US LLCs Move Toward Increased Financial Transparency:  On May 5, the US Department of the Treasury (Treasury) announced proposed regulations to increase the reporting and record maintenance requirements of US disregarded entities owned by foreign persons.  If these proposed regulations are finalized, such disregarded entities would also be required to obtain an employer identification number (EIN) by filing an IRS Form SS-4 and disclosing significant information to the IRS about their ownership.  Click here for more in depth coverage.