February 12, 2021
House panel advances portion of relief package that includes $1,400 checks – Naomi Jagoda, The Hill. “The House Ways and Means Committee on Thursday advanced a key portion of Democrats’ coronavirus relief package that includes stimulus payments of up to $1,400 per person and an expansion of the child tax credit.”
Cash-in-Pockets Emerges as New Democratic Approach to Federal Aid in Coronavirus Bill – Richard Rubin, WSJ($). “Congressional Democrats are using coronavirus relief legislation to advance a vision of federal aid to households that is focused on cash assistance with few restrictions, moving away from the work requirements and minimum-income thresholds that have been cornerstones of federal policies for decades.”
“The bottom 20% of households by income would see their after-tax incomes rise by 20% because of the plan’s direct payments and tax credit expansions, according to the Tax Policy Center, a project of the Urban Institute and Brookings Institution. That group would get an average benefit of $2,810, while the middle 20% of households would get an average of $3,360, or 5.5% of after-tax income.”
Congress Could Make COVID-19 Relief Payments Fairer, Less Costly, and More Stimulative – James R. Nunns, TaxVox. “Republicans and some leading economists have raised concerns about the cost, fairness, and stimulative effects of proposed cash payments in the pandemic relief legislation Congress is considering. It is possible to redesign those payments to more effectively distribute funds and increase payments to low- and moderate-income households at no additional cost.”
Ways and Means Advances Tax Changes in Relief Bill – Jad Chamseddine, Tax Notes($).
“The proposals are part of President Biden’s American Rescue Plan being advanced by Democrats through a parliamentary procedure known as budget reconciliation, which allows the measure to be adopted by a simple majority in both chambers. The measures approved by the Ways and Means Committee will now be combined with proposals being marked up by other House committees before the bill moves to the House floor for a vote.”
An “Interest”ing Tax Hike in the COVID-19 Relief Proposal – Daniel Bunn, Tax Policy Blog. “As the House Ways and Means Committee continues working on the latest round of fiscal relief amid the pandemic, one curious provision in the legislation is a tax hike on multinational companies. One section of the legislation would repeal a provision in current law that allows U.S. multinationals to choose to allocate their interest costs on a worldwide basis (more on that in a moment).”
IRS May Not Be Equipped to Deliver Monthly Child Credit Long Term – Alexis Gravely, Tax Notes. “Lawmakers will need to consider whether the IRS is the best agency to handle monthly payments of the child tax credit if the proposal passes and is expanded beyond the duration of the coronavirus pandemic, according to researchers.”
No Chance for A Romantic Dinner in Your Favorite Restaurant on Valentine’s Day? Try TPC’s Marriage Calculator Instead – Chenxi Lu and Janet Holtzblatt, TaxVox. “Depressed that you won’t be dining out in a romantic restaurant with your loved one this Valentine’s Day? The Tax Policy Center has a prescription for the pandemic blues. Spend time with TPC’s updated Marriage Calculator for tax year 2021.”
Indiana GOP budget plan boosts school vouchers, smoking tax – Tom Davies, AP News. “The House Republican budget proposal would increase the state’s current 99.5 cents-per-pack cigarette tax that was last more than a decade ago to $1.50 and impose a 10% retail tax on electronic cigarette liquids.”
This is a roundup of tax news and opinion. Any opinions expressed or implied are those of the author and not necessarily those of Eide Bailly. Opinions found in linked items are those of the authors of the linked item, not of your bloggers or of Eide Bailly. “$” means link may be behind a paywall. Items here do not constitute tax advice.