United States: Tax Policy Update - December 8, 2015

NOTABLE QUOTABLE

Whispers of a reported deal on tax extenders among tax policy observers last week prompted Senate Finance Chairman Orrin Hatch's spokeswoman to send out an email shutting down rumors that lawmakers are close to a compromise. Check out the special section below on tax extenders to get the latest update.

LEGISLATIVE LANDSCAPE

Tax Extenders — the Good, the Bad, and the Ugly. Last week, negotiations over tax extenders hit a rough patch when Senate Finance Chairman Hatch threatened to walk away from talks if Democrats continued to...

Come One, Come Omnibus. Lawmakers must pass a package of spending bills by Dec. 11 to avoid a government shutdown. The offer and counter-offer game between Republicans and Democrats continues. It's no secret that the omnibus will need...

President Obama Signs Highway Bill. Thank goodness because we were running out of highway puns! Obama signed the $305 billion, five-year surface transportation reauthorization bill just before the temporary patch expired on Dec. 4. The renewal of the Export-Import Bank charter also hitched a ride with the bill. According to a cost estimate released by the Congressional Budget Office (CBO), the Fixing America's Surface Transportation Act or "FAST Act" would reduce the deficit by about...

REGULATORY WORLD

IRS Campaign to Protect Taxpayers from Fraud. The IRS recently announced the implementation of new measures as part of its "Taxes. Security. Together." campaign, developed in collaboration with leaders in the tax preparer industry and state tax officials to help prevent identity theft and refund fraud. This is the latest step in an effort that began in March 2015. The IRS anti-fraud campaign is designed to...

McDonald's Lands in Hot Water with the European Commission. Most recently, McDonald's Corp. was added to a growing list of U.S. firms accused of avoiding taxes in the EU through tax rulings. The EU accused Luxembourg and McDonald's of breaking state-aid rules from 2009 by allowing a McDonald's unit to escape taxation by misusing a double-taxation accord. This comes months after trade unions accused...

EU FTT Deadline Approaching, No Agreement in Sight. The fate of the Financial Transactions Tax (FTT) remains uncertain, as countries are unable to reach a consensus on the scope of the tax. The finance ministers, who are set to gather Dec. 7 to meet a looming year-end deadline, must overcome various differences to negotiate a deal. According to a state-of-play document, several unresolved issues still remain, including...

IRS Issues Corrected Rules on the Treatment of Dividend Equivalents. The IRS issued corrections, effective Dec. 7, on final and temporary rules on treatment of dividend equivalents. The dividend equivalent regulations are designed to stop foreign investors from circumventing...

The corrections document contains changes to final and temporary regulations (TD 9734), published on Sept. 18, 2015 and a change to the effective date that was applicable to transactions issued on or after Jan. 1, 2016, and before Jan. 1, 2017. The corrections document also contains guidance to nonresident alien individuals and foreign corporations that hold certain financial products providing for payments that are contingent upon or determined by reference to U.S. source dividend payments.

LOOKING AHEAD

Tuesday, 12/8

Americans for Tax Reform Foundation
The foundation, along with the Conservative Reform Network, holds a discussion on tax policy with the staff of GOP presidential candidates. Read more here.

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