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Bramwell's Lunch Beat: Dems Focus on EITC, Cadillac Tax, Solar Tax Credit

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Dec 4th 2015
Staff Writer and Editor AccountingWEB
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Warren, Cummings press for family benefits in package of tax breaks
Sen. Elizabeth Warren (D-MA) and Rep. Elijah Cummings (D-MD) called on Congress Thursday to make a set of benefits for low-income families permanent as part of a massive package of year-end tax breaks currently in the works, wrote Naomi Jagoda of The Hill. The liberal stalwarts are looking to cement the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC), as Democrats and Republicans are negotiating a deal on temporary tax provisions known as “extenders.” A deal would appeal to Democrats by making permanent the EITC and CTC expansions and appeal to Republicans by solidifying business tax breaks that expired at the end of 2014. “Republicans in Congress are considering spending billions of dollars on dozens of tax breaks for businesses, including one giveaway to Wall Street that costs $13.4 billion alone,” Cummings said. “If big business gets tax breaks, low-income Americans deserve a break, too.”

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Senate forwards effort to repeal ‘Cadillac tax'
Kimberly S. Johnson and Maxwell Murphy of CFO Journal wrote that the Senate took steps on Thursday to repeal the “Cadillac tax,” or excise tax on high-cost health plans, with overwhelming bipartisan support. In a 90-10 vote, lawmakers voted for the inclusion of an amendment axing the tax as part of a larger bill that would make deep cuts to stipulations in the Affordable Care Act. The tax, set to go into effect in 2018, would require businesses and municipalities pay a 40 percent tax on the excess cost of healthcare plans that exceed government-mandated thresholds. Albeit a small part of the nearly 1,000-page Affordable Care Act, discussion of the tax is on the rise as the start date looms. As of Dec. 2, the term “Cadillac tax” was mentioned 249 times in communications from US elected officials and federal agencies in 2015, according to Voxgov, a company that tracks information from government entities.

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US solar industry in urgent push to extend tax incentive
As world leaders convene in Paris to forge a pact to curb carbon emissions, the US solar industry is pushing to seal a smaller deal in Washington that for it is arguably more urgent: preventing a key clean energy incentive from disappearing, wrote Nichola Groom of Reuters. Solar supporters want US lawmakers to extend a 30 percent tax credit for solar installations, possibly as part of a package of renewed temporary tax breaks Congress is working to pass in the next two weeks. The tax credit is currently slated to step down to 10 percent for commercial solar systems, and expire for residential systems, at the end of 2016. The industry says extending the 30 percent tax credit now will help companies gear up for investments next year, rather than spending 2016 preparing for a rollback. “It's critical that leaders act this year to give certainty to solar workers,” said Bryan Miller, senior vice president of public policy and power markets at Sunrun Inc.

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US corruption charges filed against 16 more high-ranking FIFA officials
The US Justice Department's widening probe of international soccer led to 16 high-ranking FIFA officials being indicted on corruption charges on Thursday, including the presidents of two federations overseeing the sport in the Americas, wrote Kevin Baxter and Timothy M. Phelps of the Los Angeles Times. A 92-count indictment unsealed in a federal courtroom in Brooklyn accuses the men of racketeering, wire fraud, and money laundering, among other offenses, over a 24-year period and brings the total number of individuals and entities charged since May to 41. Justice Department officials said the criminal investigation, which has also involved the FBI and the IRS, will continue both in the United States and in Switzerland, FIFA's headquarters, where American authorities have been working with local officials. “We have, we believe, a very good picture of the scope of the bribery and the scope of the corruption,” said US Attorney General Loretta Lynch.

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Quick Links:

  • 2015 becomes the biggest M&A year ever (Wall Street Journal)
  • Luxembourg to appeal EU Fiat tax deal decision (Wall Street Journal)
  • The IMF is pushing for carbon taxes, but at what price? (Wall Street Journal)
  • Here are some health initiatives accounting firms should consider for the upcoming busy season (Going Concern)
  • The IRS is losing hundreds of criminal investigators (Bloomberg)
  • A battle over billions in tax incentives (CBS News)
  • Deficit worries over a permanent extenders package? (Tax Foundation)
  • Millennials pay very little in income taxes (Tax Foundation)
  • The Sanders corporate tax reform plan (Huffington Post)
  • The highway bill takes Congress on a FAST track to more debt (TaxVox)

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