On The Hill

Tax Update (November 30)

Dec 3, 2018 | SHARE  
The Fate of Extenders


Ways and Means Chairman Kevin Brady’s (R-TX-08) year-end tax bill is on life support after being pulled from the House floor today. Republican leadership is blaming low attendance and steering committee scheduling, but it’s more than likely Republicans did not have the votes. Even if the bill can be resurrected next week, Chairman Brady’s 379 page bill is effectively dead-on-arrival with most House Democrats and in the Senate. Incoming Ways and Means Chair Richard Neal (D-MA-01) Ranking Finance Senator Ron Wyden (D-OR) were both a vocal opponent of the bill from the beginning. House Democrats pledged to hold hearings to expose procedural flaws and errors in the Tax Cuts and Jobs Act (TCJA) before they consider technical or more substantive fixes to the bill. However, substantive corrections to the TCJA, such as fixing major glitches affecting retailers and veterans, are more likely to pass if Democrats can agree on what price to extract from Republicans to pass the provision.  This would be similar to this year’s “grain glitch” fix for rural co-operatives that was accompanied by a Low Income Housing tax credit expansion. Brady also proposed making the short line railroad tax credit permanent and has a long phase-out for biofuels credits, which is incoming Senate Finance Chairman Chuck Grassley’s (R-IA) top priority.


Senate Effort


The Senate is likely to make major modifications to the TCJA  package. Most notably, the extenders will cover two years (if at all) – one year back and one year forward – and the technical corrections will almost certainly will be dropped.  There is also bipartisan support for retirement and most IRS reform components of the bill.


Foreign Tax Credit and 163(j) Guidance


This week, Treasury and the Internal Revenue Service (IRS) released proposed regulations that established guidance relating to the determination of the foreign tax credit. They also released guidance on 163(j) limits on business interest deduction.  The guidance provides general rules and definitions, as well as rules for calculating the limitation in consolidated groups, partnerships, and international contexts.


Upcoming Hearings

House Committee Meeting Schedule


Senate Committee Meeting Schedule



Congressional Calendar

The House and Senate are in session next week.


House Calendar


Senate Calendar


The Week Ahead

For the main events of the next week and more, go straight to the key events on the house.gov website.

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The Week Ahead

For the main events of the next week and more, go straight to the key events on the senate.gov website.

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