Daily Tax Update - April 24, 2009

TENTATIVE DEAL REACHED ON FY 2010 BUDGET RESOLUTION:  Agreement has been tentatively reached on the fiscal year 2010 budget resolution according to Democratic staff. The agreement is said to include reconciliation instructions for health care and education legislation, which would prevent the legislation from being filibustered in the Senate. Senate Budget Committee Chairman Kent Conrad said that the conferees are leaning toward the Senate budget resolution's provision of the alternative minimum tax, which would not offset any patch for the first three years but offset it in the next two years. Conrad said, “I think the likelihood is that it will be three years on AMT.” Final passage is expected next week.

Revenue Procedure 2009-26 provides guidance under § 1211 of the American Recovery and Reinvestment Tax Act of 2009 on how a taxpayer that is an eligible small business makes an election to carry back a net operating loss (NOL) for a taxable year ending after 2007, for 3, 4, or 5-years instead of the normal 2-years. Rev. Proc. 2009-26 modifies the election procedures in Rev. Proc. 2009-19, 2009-14 I.R.B. 747. A taxpayer may make the election by attaching a statement to the taxpayer’s original income tax return for the taxable year of the 2008 NOL or by claiming the NOL carryback on the appropriate form (Form 1045, Form 1139, or an amended return).

H.R.2069: To amend the Internal Revenue Code of 1986 to provide a credit for the purchase of new motor vehicles.
Sponsor: Rep Hoekstra, Peter [MI-2] (introduced 4/23/2009)      Cosponsors (None)

H.R.2080: To amend the Internal Revenue Code of 1986 to extend the credit for nonbusiness energy property and to include biomass heating appliances in energy-efficient building property.
Sponsor: Rep Hodes, Paul W. [NH-2] (introduced 4/23/2009)      Cosponsors (None)

H.R.2091: To amend the Internal Revenue Code of 1986 to impose a retail tax on single-use carryout bags, and for other purposes.
Sponsor: Rep Moran, James P. [VA-8] (introduced 4/23/2009)      Cosponsors (None)

H.R.2096: To amend the Internal Revenue Code of 1986 to allow long-term care insurance to be offered under cafeteria plans and flexible spending arrangements and to provide additional consumer protections for long-term care insurance.
Sponsor: Rep Pomeroy, Earl [ND] (introduced 4/23/2009)      Cosponsors (3)

H.R.2098: To amend the Internal Revenue Code of 1986 to extend the look-through treatment of payments between related controlled foreign corporations.
Sponsor: Rep Tanner, John S. [TN-8] (introduced 4/23/2009)      Cosponsors (2)

S.885: A bill to amend the Internal Revenue Code of 1986 to provide special depreciation and amortization rules for highway and related property subject to long-term leases, and for other purposes.
Sponsor: Sen Bingaman, Jeff [NM] (introduced 4/23/2009)      Cosponsors (1)

S.888: A bill to amend the Internal Revenue Code of 1986 to terminate certain incentives for oil and gas.
Sponsor: Sen Schumer, Charles E. [NY] (introduced 4/23/2009)      Cosponsors (None)

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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