Daily Tax Update - February 17, 2011: Ways and Means Approves Bills To Repeal Enhanced Form 1099 Reporting Requirements

WAYS AND MEANS APPROVES BILLS TO REPEAL ENHANCED FORM 1099 REPORTING REQUIREMENTS:  Today, the House Ways and Means Committee passed legislation that would repeal the enhanced Form 1099 reporting requirements included in last year's health care reform act (generally requiring businesses, starting in 2012, to report all goods and services transactions valued over $600 to the IRS).

  • Because of disagreement over how to pay for the repeal bill, the Committee had to approve two bills.  The first bill contains no offsets and will not go to the House floor.  The second bill is paid for with modifications to the limitations on amounts required for repayment of advance premium assistance tax credits for health insurance.
  • A summary of the bill can be accessed here.  

ASSISTANT TREASURY SECRETARY FOR TAX POLICY SAYS TAX REFORM DEBATE WILL EXAMINE ELIMINATION OF DEFERRAL:   Today, Michael Mundaca, Assistant Treasury Secretary for Tax Policy, said that discussions on corporate tax reform will include whether to eliminate US taxes on profits earned abroad.  Mundaca also said that corporate tax reform would occur before individual tax reform.  Mundaca said moving to a "territorial" tax system "has to be part of the discussion."

MISCELLANEOUS GUIDANCE RELEASED TODAY:
Revenue Ruling 2011-6 provides various prescribed rates for federal income tax purposes including the applicable federal interest rates, the adjusted applicable federal interest rates, the adjusted federal long-term rate, the adjusted federal long-term tax-exempt rate.  These rates are determined as prescribed by ยง 1274. The rates are published monthly for purposes of sections 42, 382, 412, 1288, 1274, 7520, 7872, and various other sections of the Internal Revenue Code.

Notice 2011-17 informs the public of the effect of Emancipation Day, a legal holiday in the District of Columbia, on the filing deadline for all tax forms required to be filed on April 15, including the Form 1040 series tax returns.

Revenue Ruling 2011-5 provides the rates for interest on tax overpayments and underpayments for the calendar quarter beginning April 1, 2011.  The interest rates will be 4 percent for overpayments (3 percent in the case of a corporation), 4 percent for underpayments, 1 and one-half percent for the portion of a corporate overpayment exceeding 10,000, and 6 percent for large corporate underpayments.  This quarterly determination is required by section 6621 of the Internal Revenue Code.

TAX BILLS INTRODUCED FEBRUARY 16TH:
1.  [112nd] H.R.734: To amend the Internal Revenue Code of 1986 to repeal the medical device tax, and for other purposes.
Sponsor: Rep Bilbray, Brian P. [CA-50] (introduced 2/16/2011)      Cosponsors (2)
Committees: House Ways and Means; House Appropriations
Latest Major Action: 2/16/2011 Referred to House committee. Status: Referred to the Committee on Ways and Means, and in addition to the Committee on Appropriations, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

2.  [112nd] H.R.736: To amend the Internal Revenue Code of 1986 to extend the Build America Bond program, and for other purposes.
Sponsor: Rep Richardson, Laura [CA-37] (introduced 2/16/2011)      Cosponsors (1)
Committees: House Ways and Means
Latest Major Action: 2/16/2011 Referred to House committee. Status: Referred to the House Committee on Ways and Means.

3.  [112nd] H.R.743: To amend the Internal Revenue Code of 1986 to allow the work opportunity credit to small businesses which hire individuals who are members of the Ready Reserve or National Guard.
Sponsor: Rep Jenkins, Lynn [KS-2] (introduced 2/16/2011)      Cosponsors (3)
Committees: House Ways and Means
Latest Major Action: 2/16/2011 Referred to House committee. Status: Referred to the House Committee on Ways and Means.

4.  [112nd] H.R.747: To amend the Internal Revenue Code of 1986 to extend the Build America Bonds program.
Sponsor: Rep Schiff, Adam B. [CA-29] (introduced 2/16/2011)      Cosponsors (None)
Committees: House Ways and Means
Latest Major Action: 2/16/2011 Referred to House committee. Status: Referred to the House Committee on Ways and Means.

5.  [112nd] H.R.749: To amend the Internal Revenue Code of 1986 to permanently extend the subpart F exemption for active financing income.
Sponsor: Rep Tiberi, Patrick J. [OH-12] (introduced 2/16/2011)      Cosponsors (5)
Committees: House Ways and Means
Latest Major Action: 2/16/2011 Referred to House committee. Status: Referred to the House Committee on Ways and Means.

6.  [112nd] S.359: A bill to amend the Internal Revenue Code of 1986 to repeal the expansion of information reporting requirements to payments made to corporations, payments for property and other gross proceeds, and rental property expense payments, and for other purposes.
Sponsor: Sen Johanns, Mike [NE] (introduced 2/16/2011)      Cosponsors (None)
Committees: Senate Finance
Latest Major Action: 2/16/2011 Referred to Senate committee. Status: Read twice and referred to the Committee on Finance.

7.  [112nd] S.361: A bill to amend the Internal Revenue Code of 1986 to provide tax relief for small businesses, and for other purposes.
Sponsor: Sen Collins, Susan M. [ME] (introduced 2/16/2011)      Cosponsors (None)
Committees: Senate Finance
Latest Major Action: 2/16/2011 Referred to Senate committee. Status: Read twice and referred to the Committee on Finance.

8.  [112nd] S.364: A bill to amend the Internal Revenue Code of 1986 to establish a new Small Business Savings Account.
Sponsor: Sen Pryor, Mark L. [AR] (introduced 2/16/2011)      Cosponsors (2)
Committees: Senate Finance
Latest Major Action: 2/16/2011 Referred to Senate committee. Status: Read twice and referred to the Committee on Finance.

9.  [112nd] S.367: A bill to amend the Internal Revenue Code of 1986 to allow the work opportunity credit to small businesses which hire individuals who are members of the Ready Reserve or National Guard, and for other purposes.
Sponsor: Sen Brown, Scott P. [MA] (introduced 2/16/2011)      Cosponsors (1)
Committees: Senate Finance
Latest Major Action: 2/16/2011 Referred to Senate committee. Status: Read twice and referred to the Committee on Finance.

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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