Daily Tax Update - July 23, 2009

PRESIDENT INDICATES SUPPORT FOR REVAMPING HEALTH CARE SURTAX–SENATE POSTPONES ACTION ON BILL UNTIL FALL:  In a press conference last night, President Obama said that he supports a House Democratic leadership proposal to revise the health care surtax provision so that it only taxes millionaires. The President said, “If I see a proposal that is primarily funded through taxing middle class families, I'm going to be opposed to that because I think there are better ideas to do it.” Obama added, “I have not yet seen what the Senate Finance Committee is producing. They've got a number of ideas, but we haven't seen a final draft. The House suggested a surcharge on wealthy Americans, and my understanding, although I haven't seen the final versions, is that there's been talk about making that basically only apply to families whose joint income is a million dollars. To me, that meets my principle that it's not being shouldered by families who are already having a tough time. But what I want to do is to see what emerges from these committees, continuing to work to find more savings, because I actually think that it's possible for us to fund even more of this process through identifying waste in the system; try to narrow as much as possible the new revenue that's needed on the front end; and then see how we can piece this thing together in a way that's acceptable to both Democrats and, I hope, some Republicans.”

  • Today, Senate Majority Leader Reid said that the health care bill will not come to the Senate floor until after its August recess. Reid said, “We'll come back in the fall" to work on the bill. Finance Chairman Max Baucus said that he still hopes to be able to hold a Finance markup of the health bill before the start of the Senate’s recess. Meanwhile, House Speaker Pelosi said that she would consider keeping the House in session longer than its targeted adjournment date. Pelosi said, “I’m not afraid of August. It’s a month.”
  • Regarding possible changes to the surtax provision as passed by the House Ways and Means Committee, Chairman Rangel said yesterday, “I don't see any dramatic changes being made. We don't have time for all that.” Select Revenue Subcommittee Chairman Neal added, “We vetted these issues for months, right in that room, day after day after day. And I think that there's an acknowledgement in our committee, even by people who didn't necessarily like the outcome, that it was a pretty good piece of legislative work.”

TAX BILLS INTRODUCED JULY 22nd:
H.R.3301: To amend the Internal Revenue Code of 1986 to increase the alternative tax liability limitation for small property and casualty insurance companies.
Sponsor: Rep Pomeroy, Earl [ND] (introduced 7/22/2009)      Cosponsors (1)

S.1491: A bill to amend the Internal Revenue Code of 1986 to provide that corporate tax benefits based upon stock option compensation expenses be consistent with accounting expenses shown in corporate financial statements for such compensation.
Sponsor: Sen Levin, Carl [MI] (introduced 7/22/2009)      Cosponsors (1)

S.1497: A bill to amend the Internal Revenue Code of 1986 to allow tax-exempt bond financing for fixed-wing emergency medical aircraft.
Sponsor: Sen Cantwell, Maria [WA] (introduced 7/22/2009)      Cosponsors (1)

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.

STEPTOE & JOHNSON LLP - TAX PRACTICE
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