Daily Tax Update - June 9, 2008

MILITARY TAX RELIEF BILL AWAITS PRESIDENT’S ACTION:  The Heroes Earnings Assistance and Relief Tax (HEART) Act of 2008 (H.R. 6081) was sent to President Bush for his signature on June 6th. The President has 10 days to sign or veto the bill.

  • The HEART Act would extend or modify $1.2 billion in tax benefits for active-duty and former military service members.
  • The HEART Act contains several revenue raisers. The offsets include:
    • Treating foreign subsidiaries of US-based government contractors as domestic companies for tax purposes;
    • Taxing US citizens and long-term US residents on their worldwide income as a way to prevent tax avoidance by renouncing their citizenship or moving overseas; and
    • Increasing the general failure-to-file penalty for tax returns.
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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