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News and updates

House Considers Charitable Tax Extenders

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Last week, the House voted to renew most extenders for one year — restoring them for the current 2014 tax year so that companies and individuals can make use of the breaks when filing their 2014 tax returns. The Senate expects to clear that measure in the coming days.

Today, the House considered HR 5806, the Support America’s Charitities Act, which would make permanent a number of popular charitable tax provisions related to food contributions, conservation property and contributions from certain retirement accounts to charitable entities..

The measure’s provisions were previously passed by the House as part of December’s one-year tax extender bill (HR5771) passed last week. This measure, however, makes these provisions permanent.

Of not for universities,  the legislation would make permanent the rule allowing certain tax-free distributions from individual retirement accounts (IRAs) for charitable purposes. Taxpayers must be at least 70-and-a-half years old and make distributions of $100,000 or less per year directly to a qualifying charitable organization.  According to the House Ways and Means Committee, in the first two years that the IRA provision was available, it led to more than $140 million in charitable donations, with the median gift just under $4,500. The Joint Committee on Tax has previously estimated that enacting this provision would reduce revenues, and thus increase federal budget deficits, by about $8.4 billion over 10 years.

The measure is noncontroversial and is expected to pass under suspension of the rules. It is unlikely the Senate will consider the bill. The Administration issued a Statement of Administrative Policy against the legislation, which included a veto threat.

This Week in Congress

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With the current continuing resolution set to expire on Thursday, December 11, all eyes and ears are on House and Senate negotiators as they work toward an agreement on an omnibus spending bill that would fund the federal government through the remainder of the fiscal year.
 
Here are the committee hearings we’re paying attention to this week.
 
Tuesday, December 9
 
Senate Judiciary Committee
SEXUAL ASSAULT ON UNIVERSITY CAMPUSES
10 a.m. Dec. 9, 226 Dirksen Bldg.
Subcommittee Hearing
 
Wednesday, December 10
 
Senate Judiciary Committee
OBAMA IMMIGRATION POLICY
Dec. 10, 2:30 p.m., 226 Dirksen Bldg.
Full Committee Hearing
 
Senate Foreign Relations Committee
INTERNATIONAL RESPONSE TO EBOLA
10:30 a.m., 419 Dirksen Bldg.
Subcommittee Hearing
 
House Foreign Affairs Committee
U.S. AND THE ARCTIC
2 p.m., 2200 Rayburn Bldg.
Subcommittee Hearing

House Narrowly Passes Immigration Response

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In a fairly narrow and mostly party line vote, the House passed a measure disapproving of Obama’s immigration action yesterday. It likely stops there: Senate Majority Leader Harry Reid says the Senate won’t take it up. 

Congressman Ted Yoho (R-FL) has lead the effort in the House meant to channel conservative anger and stop the Administration’s recently announced Executive Order on immigration. 

On November 20th, President Obama announced the US would extend legal status to an estimated 4 million people who have lived in the United States for at least five years and are parents of U.S. citizens or of lawful permanent residents. The move is designed to end deportations that separate families that have been together in the United States. This action will reinforce a 2011 prosecutorial discretion order telling customs and Justice Department officials to focus deportations on immigrants who threaten public safety or national security. The Executive Order will not go into effect until next year.

Late Thursday, House lawmakers passed the bill, HR 5759, the Preventing Executive Overreach on Immigration Bill, sponsored by Rep. Yoho, which would prohibit the administration from exempting or deferring from removal certain categories of undocumented immigrants. It also would prohibit the executive branch from treating such undocumented immigrants as if they were lawfully present, had lawful immigration status or providing them authorization to work legally.

In a 219-197 vote, Seven Republicans voted against it, three Democrats voted for it, and three Republicans voted present.

The bill and the vote is largely symbolic since Senate Majority Leader Harry Reid has already announced that the Senate will not take up the measure.

Republican lawmakers are seeking other routes for nullifying the President’s executive order, including via a year-end fiscal year 2015 appropriations omnibus that would fully fund most of the government but provide only temporary spending for immigration-related activities as a way to revisit the immigration issue in the next Congress.

 

 

House to Pass Tax Extenders

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The House is set to consider HR 5771, the Tax Increase Prevention Act today. The measure would retroactively extend more than 50 expired tax breaks for one year. It would renew the individual deduction for state and local sales taxes and the equalization of tax-free benefits for transit and parking, the business research and development tax credit, bonus depreciation and other expensing rules along with the work opportunity tax credit.

Most of the renewed tax extenders, notably the R&D and tuition tax credits, expired at the end of calendar year 2013.  In total, Joint Committee on Taxation (JCT) estimates that the tax extenders would reduce revenue by $41.6 billion over 10 years.

These provisions expired on December 31, 2013, but will receive a one year extension. Originally, Senate Democratic leaders began negotiations with House Republicans on a potential deal on extenders that would renew most for two years and make a number of provisions permanent — at an overall cost of more than $400 billion over 10 years. The White House, however, last week announced that the President would veto such a deal because, while it made certain business tax breaks permanent, it would not permanently extend tax provisions for the working poor such as the expanded earned income tax credit and child tax credit. These provisions were last extended in January 2013 in the American Taxpayer Relief Act, which was the measure to avert the fiscal cliff.

Tax reform is expected to be a central focus for the next Congress. In coming Chairman of the tax-writing Ways and Means Committee, Rep. Paul Ryan (R-WI) has announced his intention to examine and reform the nation’s tax structure.

Update:  The measure passed by a vote of 378-46.

NDAA Sent to Senate

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The House passed HR 3979 the FY15 National Defense Authorization Act (NDAA) by a vote of 300-119. The Senate is expected to take up and pass the measure next week.

The measure, which must be passed annually, authorizes all Pentagon and defense-related programs for the fiscal year. In FY15, the measure authorizes $577.1 billion for the Pentagon and defense-related programs for FY 2015, of which $63.7 billion is war-related funding — including $5.1 billion requested by the president to counter the Islamic State in Iraq and Syria. Defense spending continues to account for well over 50% of overall federal discretionary spending.

The bill extends the administration’s authority to train and equip Syrian rebels fighting both ISIS and the Assad regime and authorizes funding to help train the Iraqi Army in its fight against ISIS. It includes new provisions to combat sexual assault in the military, continues restrictions on the transfer of Guantánamo Bay detainees and allows the Pentagon to slightly reduce servicemembers’ housing allowances and impose a small copay for prescription drugs. It also includes a major package of non-defense-related land management provisions, including an appropriation for the PILT program and provisions creating new National Park units.

Additionally, the legislation includes strong language on increasing military cyber security.  These efforts come in the wake of two years of leaks from Defense Department insiders and cyberattacks on both the department and its contractors, including Manning and Snowden.

The measure would require the Defense Department to report back to Congress by March 2015 on its efforts to build both interim and long-term capabilities to continuously evaluate the security status of employees with access to classified information. Another provision in the bill is directly linked to a report the Senate Armed Services Committee released in September detailing what congressional leaders called a disturbing lack of communication on cyberattacks between agencies.

Additionally, the bill would add cybersecurity to the department’s list of major force programs. The department groups certain activities into those groups for budgeting and mission planning — the current list includes programs such as special operations, mobility forces and guard and reserve forces. Breaking cybersecurity out into its own major force would serve a symbolic move to show that the issue has been elevated to a high priority for the department.