The following were originally printed in the Weekly Report, part of the BNA Tax and Accounting Center.

Volume 28 Number 46
Monday, November 16, 2009

House Passes Health Care Reform; Bill Moves to Senate

A Democratic plan to tax wealthy individuals to help pay for a $1.1 trillion health care overhaul bill (H.R. 3962) narrowly passes the House, placing a rewrite of the nation's system in the hands of the Senate, where its fate is unclear. The 220-215 House vote comes after a presidential visit for support and a long day of contentious debate. With action on the Affordable Health Care for America Act completed at this stage in the House, the debate now turns to the Senate. In the Tax Legislation section, the staff at Tax Management provide a summary of the bill's tax provisions.

Effective Date of Interest Crediting Rates for Hybrid Plans Pushed Back

IRS and Treasury say in Announcement 2009-82 they are giving sponsors of hybrid pension plans, such as cash balance plans, more time to bring their plans into compliance with pending regulations, which would prohibit hybrid plans from using interest crediting rates that are greater than a market rate of return. By extending the compliance deadline from Dec. 31, 2009, to Jan. 1, 2011, IRS and Treasury will gain additional time to formulate guidance on what constitutes “an above market rate of return.”

Tax Court Says Cost of Buying Molds Included in R&D Credit Calculations

The Tax Court holds in, TG Missouri Corp. v. Comr., that molds used for the manufacture of auto parts purchased from third-party toolmakers and sold to customers were supplies that could be included in calculating the research credit under §41 of the tax code, even though the taxpayer retained possession of the molds. The Tax Court finding overrules an IRS determination.

FOCUS: Increased Information Sharing Among Tax Authorities

The authors of this week's Focus look at worldwide trends in collaborative examinations. “The multinational corporation has become the global corporate enterprise and, in response, governments are attempting to stay in step by shifting the focus of their tax administrations to a global view,” the authors write. “Tax authorities worldwide, challenged by more complex structures and cross border transactions, are cooperating with one another to be better positioned to address this challenge.”

Web Solutions

This issue of the Weekly Report includes Web Solutions, exploring the research and technical aspects of the BNA Tax and Accounting Center, a resource providing analysis of critical issues, practice aids, and full text of the Code, regulations, IRS documents, and cases. BNA Tax and Accounting Center includes the U.S. Income Portfolio Series; the Estates, Gifts, and Trusts Portfolio Series; and Tax Practice Series. For information, call 800-223-7270.

Qualified Retirement Plans:

Seventh Circuit holds that defined benefit pension plan sponsor did not violate the ERISA's anti-cutback rule when it amended its plan.

International:

IRS examines guidance on interest rate for excess U.S.-connected liabilities.

Qualified Retirement Plans:

Eighth Circuit holds taxpayer's cash balance pension plan did not violate §417 or ERISA when it used discount rate.

International:

IRS releases guidance on determining the amount of income tax withheld from nonresident alien employees.

BNA AUDIOCONFERENCE

Business Entities: A Tax Management audioconference, Renewable Energy Financing Structures: Partnership or Lease?, will be held November 17. To register, call 800-372-1033, opt. 6 or visit http://tmaudioconference.bna.com.