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FACTOID OF THE WEEK: TIMING OF RECONCILIATION PROCESS
In ourspecial Tax Policy Update on the budget reconciliation process, we explained why reconciliation should not be regarded as a “fast-track” legislative tool. This week, let’s take acloser look at the timing of the reconciliation process.
Since 1980, Congress has produced 24 reconciliation bills, but only 20 of these measures were enacted into law. The Trump Administration and congressionalGOP leaders have made no secret of their desire to use reconciliation back-to-back next year to repeal Obamacare and pass tax reform legislation. The planis to do this as quickly as possible while President Donald Trump is still in his honeymoon period with America. But given the elaborate legislativehurdles that a reconciliation measure must overcome, how quickly can Congress get reconciliation done?
The timing of legislative action on previous reconciliation bills provides little certainty. The amount of time required to complete work on reconciliationlegislation varies greatly: the fastest record for Congress is 27 days, and the slowest clocks in at 384 days. On average, it takes Congress about 155 days(or 5 months) to get from inception to adoption. In 2017, congressional Republicans will likely try to get both reconciliation measures moving in the firsthalf of the year. The length of the legislative battles will largely depend on how neatly Republicans can craft the legislation and the intensity of theDemocratic opposition.
Go Home, Congress. Please. This may be the final legislative work week of the 114th Congress. Lawmakers are aiming to leave Washington by Friday for the holidays. Butbefore doing so, they must pass another CR to keep the federal government in operations beyond Dec. 9, when the current stopgap funding measure expires. Atthis writing, the text to the CR has not yet been posted but is expected to come Tuesday afternoon. The CR is expected to…
Trump as Cabinetmaker. President-elect Donald Trump has selected Steven Mnuchin, former partner at Goldman Sachs and finance chair of the Trump campaign, to serve as Treasurysecretary. Mnuchin spent almost 20 years at Goldman Sachs, eventually becoming chief information officer. After leaving the firm, Mnuchin foundedthe hedge fund Dune Capital Management and has several investments in the film industry. Mnuchin has no prior government experience. Mnuchin’sappointment has been met with criticism from Democrats due to…
House Committees Play Musical Chairs. Last week, the House Republican Steering Committee convened and approved the list of committee chairs for the 115th Congress. Rep. Kevin Brady(R-TX) will continue to wield the gavel of the powerful Ways and Means Committee. With Rep. Sandy Levin (D-MI) stepping down as ranking member next year,Brady will have to contend with…
Tax Reform Remains Talk of the Town. House Republicans have wasted no time in getting Donald Trump on board with their plans for tax reform in 2017. House Ways and Means Chairman Kevin Bradyindicated that the House GOP is in talks with the Trump team about the timing for legislation to reform the tax code. Brady noted that the provisions ofthe bill are currently being drafted, though he did not indicate a date for release. House Republicans are pushing to move legislation early next year,preferably within…
An Endowment Tax May Be Part of 2017 Tax Reform. The tax-exempt status that institutions of higher education have long enjoyed may be at risk under a Donald Trump administration.
Rep. Tom Reed (R-NY), the vice-chair of Trump’s transition team recently indicated that U.S. colleges may lose their tax-exempt status, unless they spend acertain percentage of their endowment gains on financial aid for middle-class families. Specifically, Reed’s proposal would require all colleges withendowments of more than $1 billion to use…
Trump Victory Puts IRS Restructuring on the 2018 Agenda. The election of Donald Trump puts the restructuring of the Internal Revenue Service on the agenda for 2018. Though Trump has not spoken extensively on therestructuring of the agency, the House GOP blueprint provides a high level overview of what may be in store for the IRS…
Trump to Meet With Koskinen. Even after the election, House Freedom Caucus Chairman Jim Jordan continues to push for IRS Commissioner John Koskinen’s impeachment. However, otherRepublican lawmakers have shown little appetite to pursue the charges, fearing that it will distract from their top priority of tax reform. Earlier thismonth, Koskinen indicated that he expects to meet…
Look Here! IRS Released a Bunch of Stuff. The IRS has recently released the following notices and guidance:
- On Tax Avoidance. In Notice 2016-73, the IRS announced the modification of rules under I.R.C § 367 that would address certain triangular reorganizations. Specifically, the IRS would like to target reorganizations where a foreign subsidiary acquires parent stock for property and uses that stock to acquire a target corporation. The IRS is concerned that corporations use…
- On Divided Equivalent Payments. The IRS issued Notice 2016-76 on the enforcement and administration of I.R.C. § 871(m). The notice addresses various industry concerns by phasing in certain provisions related to delta-one transactions and equity-linked instruments in 2017. Non-delta transactions will not subject to the rules under § 871(m) until 2018. The IRS issued final and temporary regulations under § 871(m)…
- On Tax Preparer Penalties. The IRS expanded the scope of penalties that tax return preparers are subject to if they fail to confirm an individual’s credit eligibility or determine the right credit amount. Pursuant to the Protecting Americans Against Tax Hikes (PATH) Act of 2015, preparer penalties now apply to four credits…
House Financial Services Committee
The Monetary Policy and Trade Subcommittee holds a hearing on “Unconventional Monetary Policy.”
House Financial Services Committee
The Capital Markets and GSE Subcommittee holds a hearing on “The Impact of Regulations on Short-Term Financing.”
Securities and Exchange Commission
SEC holds a meeting of the Dodd-Frank Investor Advisory Committee to discuss investor protection priorities for the New Year.
Department of the Treasury
The Treasury Department and the Office of the Comptroller of the Currency holds a meeting of the Mutual Savings Association Advisory Committee to advisethe OCC on regulatory changes or other steps the OCC may be able to take to ensure the continued health and viability of mutual savings associations andother issues of concern to existing mutual savings associations.
The institution hosts “Central Bank Governance & Oversight Reform: A Panel Discussion” with economists and former Fed officials Michael Bordo, JohnCochrane, Charles Plosser, John Taylor, and Kevin Warsh.
National Economists Club
The National Economists Club holds a luncheon discussion on “The Impact of the Dodd-Frank Act on Banks’ Non-Interest Expenses.”
The Atlantic holds the “Summit on Infrastructure and Transportation.” Participants include: former Transportation Secretary Ray LaHood, co-chair ofBuilding America’s Future; former Homeland Security Secretary Janet Napolitano, president of the University of California; and former Gov. Ed Rendell,D-Pa., co-chair of Building America’s Future.
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