Daily Tax Update - February 23, 2009

OBAMA TO DELIVER FIRST STATE OF THE UNION ADDRESS TOMORROW:  President Obama will deliver his first State of the Union address tomorrow night. White House Press Secretary Robert Gibbs said that Obama’s speech will be “a much broader economically themed speech, not just the budget.” Gibbs said that the President would “talk about the recovery plan; he'll talk about foreclosures; he'll talk about financial stability...and the reregulation of the financial industry to ensure we don't encounter the same problems again.”

  • On March 5, the President will release his fiscal year 2010 budget outline. The full budget will come about a month later. In a press conference late last week, Gibbs said, “Some of the actions that we are going to take that are out there are some honesty in budgeting, that give people a fuller picture of what's going on -- putting the -- some of the war spending back on budget; putting some disaster spending back on budget; and understanding that what that will show you on Thursday is a deficit far bigger and far redder than what might have first been imagined, because for many years we've used tricks and gimmicks to mask the size of our irresponsibility. But I think what you'll hear from the President on Tuesday is a discussion about the decisions that we are going to have to make collectively to get ourselves back on a path toward some sustainable fiscal track.”
  • Today, the President launched his “fiscal responsibility summit” by pledging to cut the federal deficit in half by the end of his first term and vowing to reinstate pay-as-you-go budgeting. Obama said, “This administration inherited a $1.3 trillion deficit, the largest in our nation's history...We cannot and will not sustain deficits like these without end.”

MISCELLANEOUS GUIDANCE ISSUED TODAY:  
IRS Finalizes Rules on Automatic Contribution Arrangements:  The IRS released final regulations (T.D. 9447) relating to automatic contribution arrangements. The regulations can be accessed here.

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