Year End Legislation -- What We Know So Far

[BobKamman]

This is from a summary of the bill released by the House majority party.  Reports elsewhere say that the Senate majority may have brought back the deduction for the three-martini lunch.  Full text of the law may be available after everyone has voted on it.  They have to pass it before they can read it.  

Direct Payments: Democrats secured an additional round of Economic Impact Payments of $600 for individuals making up to $75,000 per year and $1,200 for couples making up to $150,000 per year, as well as a $600 payment for each child dependent. This means a family of four will receive $2,400 in direct payments. Democrats also successfully pushed for a provision, which is retroactive to the CARES Act, to expand these direct payments to mixed-status households, importantly providing immigrant families across the country with access to this financial relief.

[IRonMaN]

At least this time they sat down and did a lot of homework to make sure the legislation is aimed directly at only those that need the help 😬

[Just-Lisa-Now-]

"Full text of the law may be available after everyone has voted on it.  They have to pass it before they can read it. "

I wish this was satire  😕

[BobKamman]

From Bloomberg:  The Covid-19 relief package set for a vote in Congress would clarify that business owners can deduct expenses paid for with PPP loans, which can be forgiven by the government without incurring a tax. The deduction benefit could generate more than $100 billion in tax savings for business owners, according to Brookings Institution estimates.

The legislation would override Mnuchin and the IRS, who have blocked businesses from writing off rent, utilities and other business expenses paid for with tax-free money. The agency says the tax code prohibits that sort of doubling up of tax benefits.

[qbteachmt]

I liked the comment made last night: "Everyone that got the first payment will get this new payment." I was thinking of all the dead people and the foreigners in other countries that got them. Yay! My taxes at work.

[sjrcpa]

Bill text

https://docs.house.gov/billsthisweek/20201221/BILLS-116HR133SA-RCP-116-68.pdf

[IRonMaN]

When I clicked on your link, it came up that an error occurred.  I'm thinking that is a fair synopsis of the legislation.  😀

[BobKamman]

You can find all 5,593 pages at

https://rules.house.gov/sites/democrats.rules.house.gov/files/BILLS-116HR133SA-RCP-116-68.pdf

The good stuff starts at about page 1965

The next round of EIP is considered a credit against 2020 taxes. But it is paid to anyone who was eligible based on 2019 return.

The additional $600 per “child” is only for those under 17.

Taxpayers who were deceased before 1/1/20 are not eligible (therefore, those who died in 2020 will be?).

Payments must be made by January 15, 2021. (!)

Taxpayers and children must have a “valid identification number” – but lack of one just affects that $600 amount, not the payment for the entire family. This is also retroactive to the first round of CARES Act payments.

This round of payments are not subject to offset for federal debts and (I think) even delinquent child support obligations.

[BobKamman]

Some other finds:

Business meals and beverages provided by a restaurant, subject to the 50% limit, are now 100% deductible for years 2021 and 2022. This is going to rescue the dining industry. So how would it apply to per diem allowances?  We assume that would be restaurant food?

The $300 deduction for charitable contributions, even for those who don’t itemize, is $600 on a joint return starting in 2021.

Taxpayers whose earned income in 2020 was less than in 2019 may elect to use the 2019 amount for EIC and child tax credits. For joint returns, the combined earned income in 2020 must be less than in 2019. We will eventually figure out how this applies to people who divorced and then married someone else in 2020.

[Just-Lisa-Now-]

"Everyone that got the first payment will get this new payment."

Unless the first payment was based on 2018 and you dont qualify with your 2019 income.

[sjrcpa]

It's close to 6,000 pages. Wait for the Readers Digest version.

Sorry about the link. It works for me. Did you try Bob's link?

[rbynaker]

---

@sjrcpa wrote:

It's close to 6,000 pages. Wait for the Readers Digest version.

---

And AFAIK it's not an actual law, just a bill that Congressional leadership told the media they agree on.  I'm not convinced the ball has stopped bouncing yet.

They were supposed to come up with something by last Friday (when the government was scheduled to shut down.)  Instead they passed a 48-hour funding stop-gap measure and vowed to work through the weekend and get it done by Sunday.  On Sunday (yesterday) they passed a 24-hour stop-gap thinking they would have something today.  My understanding from news sources today is that the House will be passing a bill that simply determines the debate rules for the ~6K page bill while funding the government for another 7 days.  Supposedly to give the House time to vote on the actual bill, which will be split into two parts.  Then the two parts will be duct-taped together and sent to the Senate to vote on.  So maybe we'll have something by next Monday?  And maybe the "something" we'll have is just another stop-gap extension.

Another article I read attributed the delay to a printing problem.  I envisioned some Congressional staffer going full "Office Space" on an old HP printer.  Paper Jam?  PC Load Letter?

Tell me again, what's the opposite of PROgress?

[BobKamman]

When you have Mnuchin promising payments by next week, it's safe to say the fix is in.  The train has left the station and aside from a couple formalities (votes by the Congressional sheep) it will arrive at the White House before midnight.  

[IRonMaN]

@sjrcpa  - both links are working today, so I went ahead and read it.  Well, I read as much as I am going to ------------ I read the title.  If nobody in Washington voting on it is going to read the thing, I certainly am not going to waste my time reading it.  🤓

[BobKamman]

@IRonMaN "If nobody in Washington voting on it is going to read the thing, I certainly am not going to waste my time reading it."

Not just voting.  Also signing.  But in fairness to Congress, that's why there are hundreds of committees and subcommittees.  Each deals with the pages that involve its turf.  This is especially true with appropriations, which most of this law covers.  And all of these committees have professional staff who often work 12 hours a day to make sure the language matches what their bosses intend.  This allows the elected members to spend their time raising money to pay the television stations.  Much of that money comes from the lobbyists, who also carefully read the parts that especially interest their clients.  

[sjrcpa]

Trump may not sign it.

Trump Signals He May Not Sign COVID-19 Relief Bill (taxnotes.com)

[Just-Lisa-Now-]

Did you watch his speech last night? He was actually coherent and didnt ramble on with exaggerations about himself, it was kind of refreshing...still couldnt help himself and ended by saying he still may be re-elected as president.

[IRonMaN]

I didn't see it but I believe that was his body double.  He is still down his basement counting votes and trying to figure out how to destroy the world.  Well, at least how to destroy Michigan, Pennsylvania, Arizona, and Georgia.

[BobKamman]

By next week he'll be denying that $2,000 was anything more than a bargaining chip to get the payments raised to something like $1,200.  What he really wants, though, is another CR that takes him past January 6, and a new bill that he doesn't have to sign until after the Electoral College votes are counted. This has nothing to do with Covid relief; it's still all about the election.  If anyone cared about hardworking people, they would allow more than $300 a week in unemployment payments for just 11 weeks.    

[abctax55]

He just vetoed it....

Oops, wrong bill.

[BobKamman]

@sjrcpa "Trump may not sign it."

Oh ye of little faith

[sjrcpa]

It took him long enough.

[IRonMaN]

He has been really, really busy. 😬

[qbteachmt]

Did you folks notice that the Search Results from today's input from your profiles are showing as 2021? Weird. My computer's date is fine.

[Just-Lisa-Now-]

"Search Results from today's input from your profiles are showing as 2021"

I dont even know what this means.

[sjrcpa]

The pdf version is only 2,124 pages. 😃

[qbteachmt]

@IntuitAustin 

@Just-Lisa-Now- 

Click on any username from this topic or other topic where the replies are from yesterday and today, to see the returned list for that user has everything dated in 2021, but only for yesterday and today,

[Just-Lisa-Now-]

Ah ok...yep, we've fast forwarded a year....feels the same LOL