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house Bill H.R. 88

Extending Expiring Tax Code Provisions, Modernizing the IRS, and Providing Tax Relief for Disaster Victims

Argument in favor

This bill extends provisions of the tax code that would cause economic hardship to many Americans if they were to expire, while modernizing the customer service experience at the IRS to improve taxpayers’ experience. It also expands retirement opportunities, helps start-ups, and makes needed technical corrections to the tax code.

Morris's Opinion
···
11/30/2018
Why does Washington not figure out how to live with in their means rather than how to tax anything and everything?
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SneakyPete's Opinion
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11/30/2018
👍🏻 H.R. 88 - Modernization of the 🇺🇸 IRS 👍🏻 I’m in support of this House bill (H.R. 88) which has been amended to extend expiring tax code provisions to prevent tax hikes, expand retirement savings opportunities, modernize the Internal Revenue Service’s (IRS) IT services to improve taxpayers’ experience, provide tax relief to individuals affected by disasters, and make technical corrections to the tax code. In its original form, the bill adjusted the boundary of the Shiloh National Military Park and designated the Parker’s Crossroads Battlefield, but those provisions have been removed. This bill extends provisions of the tax code that would cause economic hardship to many Americans if they were to expire, while modernizing the customer service experience at the IRS to improve taxpayers’ experience. It also expands retirement opportunities, helps start-ups, and makes needed technical corrections to the tax code. SneakyPete..... 👍🏻👍🏻👍🏻👍🏻. 11*29*18.....
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Mary's Opinion
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02/27/2017
From Congress.gov: This bill modifies the boundary of Shiloh National Military Park to include the Fallen Timbers Battlefield, the Russell House Battlefield, and the Davis Bridge Battlefield. The Department of the Interior may acquire lands by donation, purchase from willing sellers, or exchange.
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Argument opposed

This bill didn’t go through regular order and was hurriedly thrown together to not only extend expiring provisions of the tax code but also make significant changes to Americans’ retirement opportunities. It also makes technical corrections to fix mistakes that were enacted with GOP tax bill that was also rushed through floor consideration.

Erin's Opinion
···
11/30/2018
There are too many issues being handled under this bill. A lot of these issues once again seem to benefit the wealthy. I don’t know about most middle class Americans, but I don’t own a horse and this I cannot deduct its value and receive a tax credit over a three year period. Once again, one of the few tax credits I am eligible for is being reduced/eliminated. Thanks again for nothing.
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John's Opinion
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11/30/2018
Never trust a tax bill sponsored by Repugnacants!
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Theresa's Opinion
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11/30/2018
Too many things in one bill. This is what is a major problem with Congress. How about you vote for each things individually based on its merits & stop it with these package deals!
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate Passed June 6th, 2018
    Passed by Voice Vote
      senate Committees
      Committee on Energy and Natural Resources
  • The house Passed December 20th, 2018
    Roll Call Vote 220 Yea / 183 Nay
      house Committees
      National Parks, Forests, and Public Lands
      Committee on Natural Resources
    IntroducedJanuary 3rd, 2017

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What is House Bill H.R. 88?

(Updated 11/27/18) This bill has been amended to extend expiring tax code provisions to prevent tax hikes, expand retirement savings opportunities, modernize the Internal Revenue Service’s (IRS) IT services to improve taxpayers’ experience, provide tax relief to individuals affected by disasters, and make technical corrections to the tax code. In its original form, the bill adjusted the boundary of the Shiloh National Military Park and designated the Parker’s Crossroads Battlefield, but those provisions have been removed. A breakdown of the bill’s current contents can be found below.

TAX EXTENDERS

This section of the bill would extend, make permanent, and/or phase-out a variety of provisions in the tax code. The $1 per gallon biodiesel and renewable diesel credit would be extended through 2021, gradually reduced each year over the 2022-24 period, and phased-out entirely starting in 2025. The Railroad Track Maintenance Credit would be made permanent and modified to give short- and medium-line railroads a 30% credit for spending on track maintenance.

Extensions for the 2018 Tax Year:

  • The treatment of mortgage insurance premiums as interest for the mortgage interest deduction;

  • The exclusion from gross income the discharge of indebtedness on a principal residence.

  • The above-the-line deduction of qualified higher education tuition and related expenses capped at $4,000 for those earning up to $65k and $2,000 for earners up to $80k.

  • Non-business home energy efficiency improvement credits and the deduction for commercial energy efficiency projects;

  • Credits for fuel cell motor vehicle & 2-wheeled plug-in electric vehicles;

  • Empowerment zone tax incentives;

  • Electricity produced from biomass, geothermal, landfill gas, trash, hydropower, or marine & hydrokinetic renewable energy; and coal produced by Indian tribes;

  • Rules allowing the classification of racehorses as 3-year property for depreciation purposes;

  • Expensing of advanced mine safety equipment & the mine rescue team training credit;

  • The credit for employing members of Indian tribes;

  • Expensing rules for qualified film, television, and live theatrical productions.

  • The American Samoa economic development credit.

For the 2019 tax year, the Oil Spill Liability Trust Fund financing rate would be extended, as would the Black Lung Liability Trust Fund Excise Tax.

RETIREMENT & SAVINGS

Multiple employer retirement plans that have a pooled plan provider that administers it and ensures it meets applicable tax-law and ERISA requirements would be considered “pooled employer plans”. If one employer in the pooled provider plan violates a tax-law requirement, the other employers in the pool would be unaffected. Additionally, the ERISA requirement that all pool participants be related in some fashion (such as industry or region) would be eliminated, which would make it easier for employers to join pooled plans. These provisions would be effective for plan years starting in 2020.

Employers would have until the 30th day before the close of the plan year to choose to use the non-elective contribution safe harbor for the year. Employers would have until the end of the following plan year to choose the safe harbor if the employer picks an enhanced non-elective contribution of at least 4% of the employee’s compensation (instead of 3% which is generally required under the safe harbor).

Fellowship grants, scholarships, or other amounts paid to an individual to help their pursuit of graduate or postdoctoral study or research and are includable in their taxable income would be treated as income for IRA-contribution purposes effective starting in the 2019 tax year.

Other provisions of this section would:

  • Repeal the maximum age for traditional IRA contributions to allow individuals over age 70.5 years of age to make contributions starting in 2019.

  • Prohibit employer-sponsored retirement plans from offering account loans that can be accessed through credit cards starting on the date of this bill’s enactment.

  • Allow current employees who have defined-contribution accounts invested in annuities to choose to keep their investment by rolling the annuity into an IRA if the employer discontinues the annuity as an investment option starting in 2019.

  • Require the Treasury Dept. to issue guidance to ensure there’s no disruption when an employer terminates at 403(b) plan so its assets are contributed to a custodial account with an IRS-approved nonbank trustee starting in 2019.

  • Clarify that certain employees can participate in retirement plans for church organizations, including ordained, commissioned, or licensed ministers regardless of the source of their compensation for plans year beginning after 2009.

  • Increase by $500 per year the small employer retirement plan start-up tax credit for employers creating new 401(k) and SIMPLE IRA plans that include automatic enrollment features.

  • Require employers sponsoring defined contribution plans to provide a lifetime income disclosure to each plan participant that includes information about the lifetime income stream equivalent of their account balance if they were to purchase an annuity.

DISASTER TAX RELIEF

Benefits would be provided for individuals and businesses affected by Hurricanes Florence and Michael, Typhoons Mangkhut and Yutu, California fires, Kilauea volcanic eruptions and earthquakes, and Hawaii severe storms, flooding, landslides, and mudslides.

Special rules would allow beneficiaries access to retirement funds, temporary suspension of limits on deductions for charitable contributions, allowance of deductions for personal casualty disaster losses, special rules for measurement of earned income for purposes of qualification for tax credits, and a special credit for employee retention.

TAXPAYER FIRST ACT

This section of the bill would aim to modernize the Internal Revenue Service’s (IRS) information technology systems, infrastructure, and services to improve taxpayers’ experience with the agency. It would codify an independent appeals process for taxpayers, bolster enforcement of tax laws, and reform the tax court.

Independent Appeals Process

This part would codify the IRS Independent Office of Appeals into law and provide for additional congressional oversight over decisions to withhold taxpayers from the administrative review process. The IRS had been required to establish an independent appeals process, but after doing so increasingly withheld certain taxpayers from accessing the review process.

The IRS would be required to provide taxpayers with their case file prior to the start of any dispute resolution process. Under current law taxpayers have to file a Freedom of Information Act (FOIA) request to access their file.

Improved Service

The IRS would be required to develop and submit to Congress a comprehensive customer service strategy which addresses how the IRS will assist taxpayers, which will include metrics and benchmarks for measuring success.

The existing Free File Program, which offers free tax preparation software and electronically fillable forms, would be codified into law. Programs providing free tax return assistance for low-income populations, persons with disabilities, taxpayers with limited English proficiency, and other underserved communities would be permanently -- rather than temporarily -- funded with matching grants.

Sensible Enforcement

The existing Free File Program, which offers free tax preparation software and electronically fillable forms, would be codified into law. Programs providing free tax return assistance for low-income populations, persons with disabilities, taxpayers with limited English proficiency, and other under-served communities would be permanently -- rather than temporarily -- funded with matching grants.

The IRS would only be permitted to deem seized property as “perishable” if it’s liable to perish, as current law allows it to be so deemed if the property would lose value by being kept or can’t be kept without great expense. That leads to property being sold without minimum bid requirements and for significantly less than could be received at auction.

A taxpayer under audit would have to be notified by an IRS employee before the IRS initiates third party contacts during the audit. Currently, this notice typically occurs at the beginning of an audit, early enough that it doesn’t function as a notice of impending contact.

It would be prohibited for a person other than an IRS officer or employee from examining books, records, and witness testimony as part of an examination other than when serving as an expert.

Cyber Security & Identity Protection

Recent IRS efforts aimed at combating identity theft tax refund fraud (IDTTRF) through public-private partnerships would be codified into law. Recommendations by the Electronic Tax Administration Advisory Committee to address the threat of IDTTRF.

The IRS would also participate in an IDTTRF information sharing and analysis center (ISAC) with state and private sector partners. Limited return information could be shared, such as IP address and the speed at which the return was filed, with paid return preparers who are members of the ISAC.

Modernization

The IRS would require individuals filing 10 or more returns would be required to file them electronically, with the requirement phased in between 2021 and 2024 (the current threshold for this requirement is 250 returns). All tax-exempt organizations that are required to file annual returns would have to submit them electronically. The IRS would be allowed to directly accept credit and debit card payments for taxes as long as the fee is paid by the taxpayer.

The IRS would be required to develop and implement an IT strategic plan in alignment with the IRS’s overall goals to ensure adequate consideration and planning for the IRS’s long-term IT needs. Robust and secure online accounts for taxpayers and their preparers would have to be developed by 2023 in order to supplement (not replace) other taxpayer services offered by the IRS, in addition to an internet portal for filing Forms 1099.

The Office of the National Taxpayer Advocate (NTA) issues Taxpayer Advocate Directives (TADs), and this bill would strengthen TADs by requiring the IRS Commissioner or Deputy Commissioner to respond within a specified timeframe. Any TADs not honored by the IRS would have to be reported to Congress. The IRS Oversight Board, which has been ineffective because of the lack of a quorum for a few years, would be permanently eliminated.

Tax Court

Judges in the Tax Court would be subject to the same grounds for disqualification as judges of other federal courts to ensure independence and impartiality. The judicial terminology of “opinion”, “judgment”, and “magistrate judges” used by other federal courts would be adopted by the Tax Court to provide greater clarity. References in current law to the Board of Tax Appeals would be eliminated as they’re “deadwood” (ie obsolete).

TECHNICAL CORRECTIONS

Several provisions of the tax code would be modified as they relate to the Tax Cuts and Jobs Act:

  • Attorneys’ fees involved in non-disclosure agreements related to sexual harassment or abuse claims wouldn’t be deductible for defendants.

  • Carryovers and carrybacks of net operating losses (NOLs) would apply to NOLs beginning in the 2018 tax year.

  • The cost recovery period for qualified improvement property would be 15 years under the modified accelerated cost recovery system and 20 years under the alternative depreciation system.

  • Individual shareholders of a regulated investment company (RIC) that owns stock in a real estate investment trust (REIT) or interests in a publicly traded partnership who receive dividends or income from an RIC would be attributable to qualified REIT dividends.

The low-income housing tax credit’s general public use requirement would be clarified to include veterans’ housing.

Taxpayers would be able to deduct up to $20,000 in start-up and organizational costs (indexed for inflation) to the extent that total start-up and organizational costs don’t exceed $120,000 (also indexed). Start-ups that change ownership wouldn’t be subject to the “section 382 limitation”, which limits the amount of pre-change losses that can be counted in the lookback period for tax purposes.

Impact

The tax code and American taxpayers; start-ups; and the IRS.

Cost of House Bill H.R. 88

The CBO estimates that enacting this bill would decrease tax revenue by $53 billion over the 2019-2028 period.

More Information

In-Depth: Rep. Kevin Brady (R-TX) introduced this bill to extend expiring provisions of the tax code, overhaul the IRS’ customer service system, provide tax relief to disaster victims, and make technical corrections to the tax code:

“This broad, bipartisan package builds on the economic successes we continue to see throughout our country. The policy proposals in this package have support of Republicans and Democrats in both chambers. I look forward to swift action in the House to send these measures to the Senate.”

Sen. Ron Wyden (D-OR) expressed opposition to this bill, telling reporters on Tuesday:

"Using the media as a middleman to distribute tax proposals didn't get the Republicans bipartisan support for their tax ideas in 2017, and I don't think it's going to help them now. My take is, when the other essentially learns about it for the first time in the press, which was last night, is invariably messaging and gamesmanship."

The National Retail Federation and the National Association of Manufacturers expressed support for this bill.


Of Note: The House passed the Taxpayer First Act on a 414-0 vote in April 2018 as a standalone bill, but it hasn’t been taken up by the Senate.


Media:

Summary by Eric Revell

(Photo Credit: iStock.com / cabania)

AKA

Shiloh National Military Park Boundary Adjustment and Parker's Crossroads Battlefield Designation Act

Official Title

To modify the boundary of the Shiloh National Military Park located in Tennessee and Mississippi, to establish Parker's Crossroads Battlefield as an affiliated area of the National Park System, and for other purposes.

    Why does Washington not figure out how to live with in their means rather than how to tax anything and everything?
    Like (40)
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    There are too many issues being handled under this bill. A lot of these issues once again seem to benefit the wealthy. I don’t know about most middle class Americans, but I don’t own a horse and this I cannot deduct its value and receive a tax credit over a three year period. Once again, one of the few tax credits I am eligible for is being reduced/eliminated. Thanks again for nothing.
    Like (55)
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    Never trust a tax bill sponsored by Repugnacants!
    Like (38)
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    Stop bundling bills
    Like (28)
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    Too many things in one bill. This is what is a major problem with Congress. How about you vote for each things individually based on its merits & stop it with these package deals!
    Like (24)
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    Protecting our land and parks is essential. But where is the information to make an informed decision?
    Like (20)
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    👍🏻 H.R. 88 - Modernization of the 🇺🇸 IRS 👍🏻 I’m in support of this House bill (H.R. 88) which has been amended to extend expiring tax code provisions to prevent tax hikes, expand retirement savings opportunities, modernize the Internal Revenue Service’s (IRS) IT services to improve taxpayers’ experience, provide tax relief to individuals affected by disasters, and make technical corrections to the tax code. In its original form, the bill adjusted the boundary of the Shiloh National Military Park and designated the Parker’s Crossroads Battlefield, but those provisions have been removed. This bill extends provisions of the tax code that would cause economic hardship to many Americans if they were to expire, while modernizing the customer service experience at the IRS to improve taxpayers’ experience. It also expands retirement opportunities, helps start-ups, and makes needed technical corrections to the tax code. SneakyPete..... 👍🏻👍🏻👍🏻👍🏻. 11*29*18.....
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    Another GOP lie.
    Like (13)
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    No I don’t trust these folks in any regard related to taxation. They have already hosed [technical term] our tax law enough.
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    Not a clear bill.
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    No. Expire all taxes and start over with defined end dates for the taxes in effect. Live only within a defined tax stream projected extremely conservative budget.
    Like (11)
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    No, come up with something better. Stop wasting money
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    We should do away with the IRS and go to a flat tax system where everybody pays the same
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    From Congress.gov: This bill modifies the boundary of Shiloh National Military Park to include the Fallen Timbers Battlefield, the Russell House Battlefield, and the Davis Bridge Battlefield. The Department of the Interior may acquire lands by donation, purchase from willing sellers, or exchange.
    Like (8)
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    A whole lot of evil lies hidden in this bill as gifts for industries and I foresee global warming catastrophes from saying tribes can continue to produce oil, coal etc. Based on history, one suspects that by “tribe” the bill means corporate barrons. So many of us, including people suffering disasters particularly, need to tax relief, but this is too much for too many. Please produce a reasonable tax relief bill that helps most of us and harms as few as possible.
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    This bill has too much crap in it to assess it properly. Stop combining a ton of unrelated bills into one piece of legislation!
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    Let’s just wait until the new Congress is seated, please. When things won’t stink so much!
    Like (6)
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    Not enough details about this bill have been provided for me to be comfortable with voting yea. Need more transparency
    Like (6)
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    Rushed through Bills have “extras” beware the wolf in sheep’s clothing
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    I don't trust it.
    Like (5)
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