Legislative Activity

Tax Reform Working Groups to Accept Public Comments on Tax Reform

Per prior coverage, the Senate Finance Committee has formed five Working Groups to “spur congressional comprehensive tax reform efforts in the 114th Congress,” including groups focused on: (1) Individual Income Tax; (2) Business Income Tax; (3) International Tax; (4) Savings and Investment; and (5) Community Development and Infrastructure. As part of this effort, Senate Finance Committee Chairman Orrin Hatch (R-UT) announced that the Working Groups will accept comments from interested stakeholders regarding their suggestions on tax reform.

The Squire Patton Boggs Tax Public Policy Group stands ready to assist stakeholders in drafting their comments and welcomes any questions on the process.

Senators Reintroduce Marketplace Fairness Act

Last week, a bipartisan group of Senators led by Senators Heidi Heitkamp (D-ND), Mike Enzi (R-WY), Dick Durbin (D-IL), and Lamar Alexander (R-TN) reintroduced the Marketplace Fairness Act. The legislation, similar to legislation introduced in 2013, would authorize states to enforce state and local sales and use tax laws. Specifically, those states that sign the Streamlined Sales and Use Tax Agreement would be permitted to require remote sellers to collect and remit sales and use taxes. The bill includes an exemption for companies making less than $1 million annually nationwide. Although the legislation has support from numerous retailers, many online businesses have expressed concern about the measure’s potential negative impact. While the legislation failed to pass last Congress, many key stakeholders are calling for the law’s “swift adoption.”

This Week’s Hearings:

  • Tuesday, March 17: The Senate Finance Committee will hold a hearing titled “Building a Competitive U.S. International Tax System.”
  • Tuesday, March 17: The House Ways and Means Subcommittee on Human Resources will hold a hearing titled “Using Evidence to Help Low-Income Individuals and Families Get Ahead.”
  • Wednesday, March 18: The House Ways and Means Subcommittee on Select Revenue Measures will hold a hearing titled “The Burden of the Estate Tax on Family Businesses and Farms.”
  • Wednesday, March 18: The House Appropriations Committee will hold a budget hearing on the Internal Revenue Service (IRS).

Regulatory Activity

IRS Lifts Stay on Issuance of MLP Private Letter Rulings

Last week, the IRS indicated that it has lifted its stay on issuing private letter rulings for Master Limited Partnerships (MLPs) and will soon release guidance on qualifying income. The IRS’s guidance on qualifying income is expected to focus on natural resource qualifying income such as “exploration, development, mining and production, processing, refining, transportation, and marketing of minerals and natural resources” and “services provided by contractors to others in the oil and gas industry.” Moreover, with regard to the issuance of private letter rulings, a senior IRS official remarked that “[i]t may take some time to process the ruling requests as we reach out to the relevant taxpayers where additional information is needed, but we expect to work diligently to process these as promptly as we can.”