Daily Tax Update - January 23, 2013: House Passes Short-Term Debt Limit Bill

HOUSE PASSES SHORT-TERM DEBT LIMIT BILL:  Today, the House passed H.R. 325, the "No Budget, No Pay Act of 2013" by a 285-144 vote.  The bill temporarily suspends the debt ceiling until May 18.  Senate Majority Leader Harry Reid said the Senate would pass the bill quickly.

  • In remarks on the House floor, House Ways and Means Committee Chairman Dave Camp said, "This legislation directs members of the House and Senate to adopt a budget resolution by April 15, 2013.  If either body does not, members of that body will have their pay withheld until they pass a budget.  It’s simple: no budget, no pay.  The American people understand that they don’t get paid if they don’t do their job, and neither should Members of Congress.  In addition, to ensure the complete and timely payment of the obligations of the U.S. Government, this legislation allows Treasury to issue debt between the date of enactment and May 18, 2013.  However, Treasury may only issue enough debt necessary to pay bills coming due before May 18.  I want to be perfectly clear on this point:  this bill does not allow Treasury to run up an unlimited amount of debt between now and May 18.  The debt authorized under this bill must be tied to bills coming due during that time frame.  Further, on May 19, a new debt limit is automatically established."

MISCELLANEOUS GUIDANCE RELEASED:

Notice 2013-10 provides guidance to certain domestic entities concerning the first taxable year they must report specified foreign financial assets under §6038D.  Reporting by domestic entities will not be required before the date specified by final regulations, which will not be earlier than taxable years beginning after December 31, 2012. 

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.

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