Text Resize

Sunday July 5, 2015

Washington News

Washington Hotline

Will Congress Fix the Tax Code?

As Americans are enjoying the 4th of July holiday, the House Ways and Means Committee staff published a summary of efforts to improve the tax code. These efforts highlight the potential changes in three areas of taxation.

1. Permanent Tax Extenders - There are 55 tax provisions that are extended for one or two years at a time. Unfortunately, the extension in 2014 occurred in mid-December. It is very difficult for people to plan or use provisions such as the IRA charitable rollover when the bills are passed so late in the year. Therefore, Ways and Means Committee staff believe that several of the tax extenders should be made permanent. The committee has passed bills to make permanent the charitable IRA rollover, enhanced deductions for gifts of food to relief organizations, state sales tax deductions and business deductions that create jobs. These bills await Senate action.

2. Highways - America needs better roads, safe bridges, airport improvements and municipal facilities. Select Revenue Measures Subcommittee Chairman Dave Reichert (R-WA) has been seeking "permanent, sustainable funding sources" for the Highway Bill. After 33 short-term extensions of the Highway Bill, Reichert desires to find a permanent solution to fund the much needed infrastructure.

3. Comprehensive Tax Reform - Members of both parties agree that the tax-code is antiquated and needs to be reformed. Most tax reform proposals involve a combination of lower tax rates and a broader tax base with fewer deductions. Committee staff suggest "the goal of tax reform should be to create a fairer, flatter code that makes America more competitive, creating new growth and jobs."

Editor's Note: Both the House and Senate tax-writing committees will continue hearings on tax reform this year and in 2016. The probable legislation for tax reform will be deferred until 2017. It is likely that a comprehensive tax reform bill will be 1000 or more pages. The last major reform in 1986 was the product of two years of detailed effort. To write this comprehensive tax change will require extensive work and negotiation between the House, Senate and White House.

Published July 3, 2015

Previous Articles

Premium Tax Credit Approved

Taxpayer Bill of Rights Enhancement Act of 2015

Identity Fraud Security Summit

Safeguarding Tax Records during Hurricane Season

IRS Progress on Identity Theft

scriptsknown

Share this page

© 2015 Crescendo Interactive, Inc. PRIVACY STATEMENT