Daily Tax Update - December 21, 2010: Senators Plan Debt-Reduction Bill

THE DAILY TAX UPDATE WILL BE PUBLISHED ON A PERIODIC BASIS UNTIL THE 112TH CONGRESS CONVENES ON JANUARY 5TH.  

SENATORS PLAN DEBT-REDUCTION BILL: Sens. Saxby Chambliss (R-GA) and Mark Warner (D-VA) said yesterday that they will introduce legislation early next year that parallels the report by the White House's debt-reduction commission. The Senators are working with a bipartisan group of 18 senators who have called on the Senate to tackle debt reduction by the end of next year.

  • Chambliss said, "At the very least, [the debt commission’s] recommendations can serve as a starting point for a serious debate on how we can ensure a better life for our children and our grandchildren."
  • Warner said, "It is time for us in the Senate - excuse the language - to put up or shut up." Warner added, "You’ve got 15 percent of GDP coming in on revenues and 24 percent going out on spending. You don’t need a PhD in economics to understand that’s not sustainable."
  • President Obama has promised to make tax reform a top agenda item in the next two years.

CONGRESS EXPECTED TO PASS CONTINUING RESOLUTION: Later today, the Senate and House will pass a continuing resolution to fund the government through March 4. The resolution provides a small increase of $1.16 billion over 2010 spending levels. Congress could adjourn later tonight or early Wednesday morning.

MISCELLANEOUS GUIDANCE RELEASED TODAY:
Announcement 2010-96 announces the release of Form 8944, Preparer e-file Hardship Waiver Request, which tax return preparers who meet the definition of a specified tax return preparer and who believe they may qualify for an undue hardship waiver may begin to use to voluntarily submit an undue hardship waiver request to the IRS now. Preparers must use Form 8944 to voluntarily request a waiver; they are encouraged to submit their requests as soon as possible, although approval of the requests will not occur prior to the publication of final regulations and a final revenue procedure, which is expected in early 2011.

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
Steptoe & Johnson LLP has one of the largest and most diverse law firm tax practices in the country. The practice covers the entire spectrum of federal taxation, including representation of businesses before the Congress, Treasury and the national office of the IRS; transactional planning for domestic and multinational corporations; complex audit and controversy work for corporations and other business interests contesting IRS adjustments; litigation before the Tax Court, Court of Federal Claims, district courts, courts of appeals and the Supreme Court. The firm's tax practice also encompasses all aspects of employee benefits (ERISA), executive compensation, tax-exempt organizations and charitable giving. Steptoe has an extensive state and local tax practice, representing an array of business clients on complex sales and use tax, corporate income tax and property tax matters, both advising those clients and handling audits, administrative appeals, and litigation for them. Read more information on Steptoe's tax practice.