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IRS Modifies Notice 1036 Withholding Tables Incorporating Changes to the Individual Tax Rates

The IRS recently released an updated version of Notice 1036 (includes income tax withholding tables for employers) which integrates the changes made by the recently passed tax legislation. The notice states that employers must implement the withholding tables by February 15, 2018. The IRS anticipates updating its online withholding calculator by the end of February. Read more: New 2018...

Speaker Ryan Foresees only Technical Corrections to the Tax Reform Bill, Rather Than Major Changes

In an interview with C-SPAN, House Speaker Paul Ryan stated that the bill previously known as the Tax Cuts and Jobs Act would require some technical corrections, such as in the area of international taxation, though he did not offer further details. He anticipates that any corrections to the bill would be small changes. House Ways and Means Committee Chair Keven Brady has also stated...

Broad Scope of “Cash” for Tax on Deferred Foreign Income Impacts Financial Sector

The new provision requiring that U.S. companies pay a 15.5 percent tax on deferred foreign earnings to the extent of cash and cash equivalents and a 8 percent tax on additional untaxed foreign earnings produces complications for the financial sector. Companies are reporting that the repatriation tax imposes a heavier burden on the financial sector because such companies typically hold...

CRS Report Analyzes 2017 Federal Tax System In Anticipation of Tax Bill Changes

The Congressional Research Service (CRS) published Report 7-5700 on December 26, 2017, which provides an overview of the federal tax system as in effect through 2017. The report notes that the new tax bill, H.R. 1, will generate broad changes for individuals (personal exemptions; standard deduction) and businesses (different tax rate for pass-through business income; territorial tax...

California Proposes Bill to Permit Donations Instead of State Taxes as Challenge to New Federal Tax Bill

The California legislature has introduced a bill that permits residents to donate to a state “public purpose” fund and receive a dollar-for-dollar tax credit on their returns. This donation is intended to be deductible for federal tax purposes as a means of circumventing the new $10,000 cap on state/local tax deductions included in the recently passed tax bill. White House economic...

New York Challenges Federal Government’s Tax Reform Bill as Unconstitutional Double Taxation

In his recent speech before the state legislature, New York Governor Andrew M. Cuomo stated that the reduction in the state and local tax deduction reflected in the new tax reform bill is unconstitutional double taxation. The governor further indicated that New York would challenge the provision. Cuomo also said that the state will undergo its own tax revision process, shifting away...

IRS Releases Guidance on the Transition Tax Provision

Last week, the IRS released Notice 2018-07 (the “Notice”), which provides guidance on calculating the so-called “transition tax” of the Tax Cuts and Jobs Act. While the Notice itself does not contain any specific regulations, it does describe the regulations that the IRS plans to issue at a later date, including guidance on the effects that the future regulations will have. The Notice...

President Trump Signs Tax Bill into Law

President Trump signed the tax bill passed by the House and Senate this morning. The bill will be generally effective beginning January 1, 2018. Read the bill text here.  Read more about the bill’s passage...

House Passes Revised Bill; Senate to Vote as Early as Tonight

The House has passed the Tax Cuts and Jobs Act, as revised by the Conference Committee, along party lines. The bill will now go to the Senate, who may vote as early as this evening. Should the bill pass both houses, it will be sent to President Trump to sign into law. Read more:  House Passes Final Tax Bill; Senate Votes Next on Republican...

Congress to Begin Voting on the Tax Cuts and Jobs Act Today

With the Conference Agreement finalized, the Agreement must be approved by both the House and Senate, and once approved, it will head to President Trump for his signature. The House is expected to vote later today, and the Senate will vote soon afterwards, either today or tomorrow. Read more:  Tax Voting Starts...

Conference Committee to Release Tax Bill and Report Tonight but Passage not Guaranteed

The conference committee has announced they will approved a conference report on the final version of the Tax Cuts and Jobs Act. The report and the bill text will be released tonight. The Republicans can only afford to lose two votes in the Senate in order to pass the final version.  Senator Marco Rubio announced that he will not support the tax bill unless Senate Republicans are able...

With a Consensus Tax Bill, Christmas May Come Early for Republicans

An agreement between Senate and House Republicans on a tax bill was finalized Wednesday morning. According to lawmakers and reports from aides, Senate and House Republicans have agreed to provisions including the following: • Corporate tax rate will drop from 35% to 21%, to go in effect in 2018. • Individuals will be allowed to deduct up to $10,000 in state and local taxes, split...

Conference Committee Working to Resolve House and Senate Differences

Conference Committee negotiators in the House and Senate over the weekend did not reach a compromise on the different versions of the Tax Cuts and Jobs Act. The main issues include the timing of the 20% corporate rate cut and whether to allow deductions for state and local taxes. Currently, Congressional Republicans hope to finalize the bill by December 20th, and Kevin Brady, Chair of...

Brady Indicates That Tax Legislation Will Include Repeal of Individual Mandate

The Senate voted to go to conference in order to reconcile their tax bill with the House Tax bill today. However, there are many differences that need to be worked out between the two bills. Key differences include the repeal of the alternative minimum tax, the implementation timing of the corporate tax rate reduction, and the repeal of the individual mandate. The repeal of the...

House Sends Tax Cuts and Jobs Act to Conference Committee

The House voted Monday to send the Tax Cuts and Jobs Act to conference committee to resolve the differences between the House and Senate versions of the bill. The committee has 14 House total members, 9 Republican and 5 Democratic. The Republican members are: Keven Brady (the Chair of the House Ways and Means Committee), Ron Bishop, Diane Black, Kristi Noem, Devin Nunes, Peter Roskam,...


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