Daily Tax Update - December 12, 2012: Congress May Have to Return After Christmas to Work on Fiscal Cliff

CONGRESS MAY HAVE TO RETURN AFTER CHRISTMAS TO WORK ON FISCAL CLIFF:  Today, House Republican leaders said that "serious differences" remained in the "fiscal cliff" negotiations and that lawmakers may have to return after Christmas.  House Majority Leader Eric Cantor said, "The president seems to be walking us ever so slowly towards the cliff."  Cantor added, "We’ve said we’re committed to staying here.  We’re going to stay here right up until Christmas Eve and throughout the time period before the new year because we want to make sure we resolve this in an acceptable way for the American people."

  • House Speaker John Boehner and President Obama traded counteroffers yesterday but differences remain.  Boehner said, "I remain the most optimistic person in this town, but we’ve got some serious differences. . . . The president and I had a frank conversation about just how far apart we remain. . . . The president’s called for $1.4 trillion in revenue.  That cannot pass the House or the Senate."  Boehner added, "We’ve been reasonable and responsible in our approach to this, and we’re going to continue to do that.  It’s time for the president to do his part."  Boehner added, "The president’s plan to avert the fiscal cliff still does not meet the two standards that I laid out the day after the election.  His plan does not fulfill his promise to bring a balanced approach to solving this problem.  It’s mainly tax hikes, and his plan does not begin to solve our debt crisis.  It actually increases spending."
  • House Appropriations Committee Chairman Hal Rogers said, "We’re in for a hard, long fight as long as the White House refuses to get involved by proposing cuts in spending.  Indications are we’ll be here after Christmas."
  • In remarks on the Senate floor today, Senate Majority Leader Harry Reid said, "The American people aren’t going to be under the illusion that the Republicans are sometime in the future going to come up with revenue.  They’re going to come up with raising the rates.  Or . . . we’re going over the cliff. . . . How many times do we have to go through this drill to know that it’s an unfair game?"  

DEMOCRATS NAMED TO WAYS AND MEANS AND FINANCE COMMITTEES:  Today, the House Democratic Caucus voted to name Reps. Linda Sanchez of California, Allyson Schwartz of Pennsylvania, and Danny Davis of Illinois to the House Ways and Means Committee.  All were former Ways and Means members.

  • Senators Sherrod Brown (D-Ohio) and Michael Bennet (D-Colo.) were named to the Senate Finance Committee.  Senators Brown and Bennet will replace outgoing Senators Kent Conrad (D-N.D.) and Jeff Bingaman (D-N.M.), both retiring this year.

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.