Daily Tax Update - March 17, 2005

SENATE DEFEATS "PAY-GO" AMENDMENT:
Yesterday, the Senate narrowly defeated an amendment sponsored by Sen. Russell Feingold (D-WI) which would have required that any spending increases or tax cuts be offset by equal spending cuts or tax increases. Senate Republican leaders have argued that pay-as-you-go should apply only to spending and not to taxes. Senate Finance Committee member Trent Lott (R-MS) said, "The problem is not tax cuts. The problem is we can't control our insatiable appetite for spending." Lott added that the pay-go amendment "would actually lead to tax increases of $70 billion on working Americans and families with children." The House continues its deliberations on its budget resolution today.

REP. NUNES EXPECTED TO ASSUME SEAT ON WAYS AND MEANS COMMITTEE:
Today, President Bush nominated House Ways and Means Committee member Rep. Rob Portman (R-OH) to serve as the U.S. Trade Representative. Once Portman is confirmed as trade representative, Rep. Devin Nunes (R-CA) is expected to assume Portman’s seat on the Committee. Nunes was appointed to serve on the Committee in January, but there were only four vacancies.

TAX BILLS INTRODUCED MARCH 16:

  • H.R. 1345 sponsored by Rep. Nancy Johnson (R-CT) would expand the tip tax credit to employers of cosmetologists and promote tax compliance in the cosmetology sector.
  • H.R. 1352 sponsored by Rep. Allyson Schwartz (D-PA) would allow employers to claim a work opportunity credit for hiring military service personnel returning from service in Iraq or Afghanistan and for hiring their dependents and dependents of deceased personnel.

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