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Thursday November 20, 2014

Washington News

Washington Hotline

IRA Rollover and Tax Extenders Debate

As the House and Senate return for the November lame-duck session, both leadership elections and tax extenders are on the front burner. Sen. Mitch McConnell (R-KY) will be the Majority Leader and Sen. Harry Reid (D-NV) will be the Minority Leader in the Senate in January. Next year, Rep. John Boehner (R-OH) will be the Speaker of the House and Rep. Nancy Pelosi (D-CA) will be the Minority Leader.

With the leadership elections over, the focus now turns to tax extenders. House Ways and Means Chairman Dave Camp (R-MI) advocates making several tax extender provisions permanent. The House passed bills with six business and six charitable provisions that would be permanent. While there is substantial cost with a permanent extension, Chairman Camp observes that the extenders previously were passed without any offsets or tax increases.

Camp enters the tax extenders negotiation with a hope that most or all of these 12 provisions could be permanent. He stated to reporters this week, “It has been the House’s position and my view that we should get as much policy permanent as possible.” When asked whether a one year extension would be acceptable, he noted that this is an alternative. Camp continued, “But I think we want to get as much policy as long as possible.”

Senate Finance Committee Chairman Ron Wyden (D-OR) is an advocate for the Expiring Provisions Improvement Reform and Efficiency (EXPIRE) Act. The Senate Finance Committee approved 53 tax extender provisions for the years 2014 and 2015 in that act. The full Senate did not vote on the bill.

Wyden stated, “The Senate feels strongly about our package, but we know that we are in a negotiation.”

The Senate Democratic Whip is Richard Durbin (D-IL). In discussions with reporters, he stated that there may be some “horse trading” in these negotiations on the tax extenders.

Editor’s Note: Will the IRA charitable rollover be made permanent? Or will it be extended for all of 2014 and 2015? The “horse trading” that Senator Durbin mentions is the potential for the Senate to accept the House request for permanent status of some or all of the 12 provisions. In exchange for permanent status for some extenders, the House would approve the balance of the 53 Senate extenders for a period of two years. Because the legislative time is short, the outcome of these negotiations is highly uncertain. America is waiting with great anticipation for the House and Senate to announce their compromise plan.

Published November 14, 2014

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