Daily Tax Update - June 25, 2009

BAUCUS SUGGESTS SOME HEALTH CARE FUNDING MAY COME FROM TAX INCREASES:  Today, Senate Finance Committee Chairman Max Baucus said that he might propose paying for some of his health care reform legislation with tax increases outside the health care system. Baucus explained that offsets would “essentially” come from the health arena, but other options could be considered. Baucus said, “The good news is we have options.” The Congressional Budget Office has provided new cost estimates for health care reform policy options that would allow him to offer a fully offset bill, around $1 trillion. Baucus said, “We’re getting closer. I expect to be ready sooner now that we have CBO numbers to enable us to have options that will fully pay for the bill.”

  • Baucus added that no details about the financing options for the health care bill have been finalized. Baucus said, “We're ready when we're ready. I'm not going to schedule a markup until senators have all the information they need.” Baucus added, “CBO has given us a lot of leeway, a lot of cushion here. We have a lot of options that will enable us to write a $1 trillion bill fully paid-for. But as I've said before, we're not going to put out a mark until we're sure we have it right.”

IRS REMINDS TAXPAYERS TO REPORT CERTAIN FOREIGN BANK AND FINANCIAL ACCOUNTS BY JUNE 30TH:  The IRS reminded US persons who have bank and other financial accounts in a foreign country that they may be required to report those accounts to the Treasury Department by the June 30 deadline. 

  • According to the IRS, “US persons are report to file a Report of Foreign Bank and Financial Accounts (FBAR), Form TD F 90-22.1, each year if they have a financial interest in or signature authority or other authority over any financial accounts, including bank, securities or other types of financial accounts, in a foreign country, if the aggregate value of these financial accounts exceeds $10,000 at any time during the calendar year.”
  • IRS Commissioner Doug Shulman said, “There are responsibilities that go along with owning such foreign bank and financial accounts. Foreign account owners must remember that they may have to report their accounts to the government, even if the accounts do not generate any taxable income.”
  • Additional information can be accessed here.
  • For additional information, contact Catherine W. Wilkinson - cwilkinson@steptoe.com or Philip R. West - pwest@steptoe.com 

H.R.3011: To amend the Internal Revenue Code of 1986 to repeal the excise tax on telephone and other communications services.
Sponsor: Rep Lewis, John [GA-5] (introduced 6/24/2009)      Cosponsors (22)

H.R.3034: To amend the Internal Revenue Code of 1986 to adjust the credit percentage for qualifying advanced energy wind projects based on domestic steel content.
Sponsor: Rep Wilson, Charles A. [OH-6] (introduced 6/24/2009)      Cosponsors (None)

S.1341: A bill to amend the Internal Revenue Code of 1986 to impose an excise tax on certain proceeds received on SILO and LILO transactions.
Sponsor: Sen Menendez, Robert [NJ] (introduced 6/24/2009)      Cosponsors (None)  

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