Daily Tax Update - July 24, 2007

GRASSLEY INTRODUCES AMT SAFE HARBOR BILL:  Today, ranking Senate Finance Committee member Charles Grassley (R-IA) introduced the AMT Penalty Reduction Act.  Under Grassley’s legislation, in computing tax for purposes of the penalties in the tax code dealing with estimated tax, a taxpayer would be permitted to disregard the alternative minimum tax if the individual was not liable for the alternative minimum tax for the preceding tax year.  Grassley said, “So if you didn’t have to pay AMT last year we aren’t going to penalize you if you don’t file estimated taxes for AMT this year.  Just because Congress can’t do its job, doesn’t mean the taxpayer should be punished.” 

TAX BILLS INTRODUCED JULY 23rd:
H.R. 3125: To amend the Internal Revenue Code of 1986 to allow individuals to designate that their income, estate, or gift tax payments be spent other than for purposes of supporting the war in Iraq and to provide that amounts so designated shall be used to provide funding for Head Start, to reduce the national debt, and to provide college funding for children of Iraq war veterans.
Sponsor: Rep. Velazquez, Nydia M. [NY-12] (introduced 7/23/2007)      Cosponsors (None)

H.R. 3129: To amend the Internal Revenue Code of 1986 to allow taxpayers to designate income tax overpayments as contributions to the Federal Government on their income tax returns.
Sponsor: Rep. Gohmert, Louie [TX-1] (introduced 7/23/2007)      Cosponsors (None)

H.R. 3135: To amend the Internal Revenue Code of 1986 to make permanent the child tax credit and to allow for adjustments for inflation with respect to the child tax credit.
Sponsor: Rep. Weldon, Dave [FL-15] (introduced 7/23/2007)      Cosponsors (None)

S. 1849: A bill to amend the Internal Revenue Code of 1986 to clarify that wages paid to unauthorized aliens may not be deducted from gross income, and for other purposes.
Sponsor: Sen. Smith, Gordon H. [OR] (introduced 7/23/2007)      Cosponsors (None)

S. 1850: A bill to amend the Internal Revenue Code of 1986 to provide for the treatment of Indian tribal governments as State governments for purposes of issuing tax-exempt governmental bonds, and for other purposes.
Sponsor: Sen. Smith, Gordon H. [OR] (introduced 7/23/2007)      Cosponsors (1)

S. 1851: A bill to amend the Internal Revenue Code of 1986 to allow personal exemptions under the individual alternative minimum tax, and for other purposes.
Sponsor: Sen. Sessions, Jeff [ AL] (introduced 7/23/2007)      Cosponsors (1)

S. 1855: A bill to amend the Internal Revenue Code of 1986 to provide relief to individuals from the penalty for failure to pay estimated taxes on amounts attributable to the alternative minimum tax in cases where the taxpayer was not subject to the alternative minimum tax in the preceding year.
Sponsor: Sen. Grassley, Chuck [IA] (introduced 7/23/2007)      Cosponsors (4)

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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