Daily Tax Update - January 8, 2013: President Obama to Nominate Jacob Lew As Treasury Secretary

PRESIDENT OBAMA TO NOMINATE JACOB LEW AS TREASURY SECRETARY:  Reports indicate that President Obama will nominate White House Chief of Staff Jacob Lew as soon as this week to serve as the next Treasury secretary.  Geithner said that he would remain in his position until after Obama’s inauguration on January 20.  Once officially nominated, Lew’s nomination will have to be approved by the Senate Finance Committee and full Senate.

JOINT COMMITTEE ISSUES OVERVIEW OF FISCAL CLIFF LEGISLATION:  The Joint Committee on Taxation issued an overview of the present-law Federal tax system as in effect for 2013 as a result of the enactment of "The American Taxpayer Relief Act – H.R.8."  According to the Joint Committee, "The current Federal tax system has four main elements: (1) an income tax on individuals and corporations (which consists of both a ‘regular’ income tax and an alternative minimum tax); (2) payroll taxes on wages (and corresponding taxes on self-employment income) to finance certain social insurance programs; (3) estate, gift, and generation-skipping taxes, and (4) excise taxes on selected goods and services.  This document provides a broad overview of each of these elements.”

  • The document can be accessed via:  JCX-2-13

IRS WILL BEGIN PROCESSING TAX RETURNS ON JANUARY 30:  The IRS plans to open the 2013 filing season and begin processing individual income tax returns on January 30.  According to the IRS, "The IRS will begin accepting tax returns on that date after updating forms and completing programming and testing of its processing systems.  This will reflect the bulk of the late tax law changes enacted January 2.  The announcement means that the vast majority of tax filers -- more than 120 million households -- should be able to start filing tax returns starting January 30.  The IRS estimates that remaining households will be able to start filing in late February or into March because of the need for more extensive form and processing systems changes.  This group includes people claiming residential energy credits, depreciation of property or general business credits.  Most of those in this group file more complex tax returns and typically file closer to the April 15 deadline or obtain an extension."  The IRS added, “The opening of the filing season follows passage by Congress of an extensive set of tax changes in ATRA on January 1, 2013, with many affecting tax returns for 2012.  While the IRS worked to anticipate the late tax law changes as much as possible, the final law required that the IRS update forms and instructions as well as make critical processing system adjustments before it can begin accepting tax returns.”

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.