Daily Tax Update - February 2, 2009

PRESIDENT OBAMA URGES SUPPORT FOR STIMULUS PLAN AS SENATE BEGINS DEBATE:  President Obama will meet with Congressional leaders today to urge bipartisan support for the economic stimulus plan. Today, the President said, “What we can't do is let modest differences get in the way of the overall package moving forward swiftly.”  Yesterday, the President said, “I am confident that by the time we actually have the final package on the floor that we are going to see substantial support.” Obama said that he would push for provisions to be removed from the bill “that are not relevant to putting people back to work right now.” The Senate will begin debating the $888 billion economic stimulus package later today.

  • Meanwhile, Senate Republicans voiced opposition to the bill in its current form. Senate Minority Leader Mitch McConnell said he doubted the economic stimulus bill can pass the Senate unless changes are made. McConnell said, “If we're going to spend anywhere near this ... it needs to be timely, temporary and targeted.
  • Late last week, Senate Democratic Conference Vice Chairman Charles Schumer said that Senate Majority Leader Harry Reid “will let Republican amendments come to the floor and be debated.” Schumer added, “If there are things that Republicans find objectionable, they can offer an amendment and get a majority vote to take it out. Or if they want to make a switch between the ratio of tax cuts to spending they can try. Speaking for myself, and I think I speak for most Democrats...I am not sure they would get much Democratic support to greatly cut back on the spending side and further increase the tax cuts. Schumer continued, “I believe that Republicans in the Senate will be more engaged in working together and at the end of the day because we are approaching this in an open way and we are willing to compromise we are going to get more Republican support in the Senate than there was in the House.”

BROKERS MAY FURNISH CERTAIN YEAR-END FORMS BY FEBRUARY 17TH: The IRS reminded taxpayers that many investors will receive their year-end tax statements later than in past years.  A new law, enacted last fall, changed the deadline from January 31 to February 15, when brokers (including brokerage firms, mutual fund companies and barter exchanges) must furnish year-end Forms 1099-B to their customers. Where a broker furnishes these forms by mail, this means that the forms must be mailed, not received, by that date.

  • Because February 15 falls on Sunday in 2009, and Monday, February 16 is a federal holiday, the deadline is February 17 this year. In addition, the IRS said earlier this month that for calendar-year 2008 reporting, the February 17 deadline also applies to other tax information that brokers report to their customers, including such items as interest and dividends, on a combined year-end statement.
  • Additional information can be accessed here.

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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