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White House Budget Proposes Permanent WOTC Tax Credit Program

Friday, April 12th, 2013

Last summer, the House Subcommittee on Select Revenue Measures held hearings to explore HOW to evaluate the numerous tax extenders coming before Congress each year.  Chairman of the Subcommittee, Congressman Pat Tiberi (R-OH) explained at the time:

“[We] need to consider carefully the principles that we should use to evaluate the merits of these policies. Having recently heard from our House colleagues about their views on many of these extenders, it is time for the Subcommittee Members to roll up their sleeves and see how the provisions stack up against what experts consider the principles of sound tax policy.”

Ultimately, some programs should be made permanent while those not worthy of permanence should be eliminated altogether.

A loose consensus has existed among observers that the Work Opportunity Tax Credit (WOTC) program would be a strong candidate for permanence.   The Obama Administrative this week has cast its vote on that issue.

On page 33 of the Fiscal Year 2014 Budget of the U.S. Government we find this little jewel.  (Thank you to Paul Suplizio, President of the WOTC Coalition, who pointed this out in a coalition email early this week.)

The Administration also continues its support of tax credits that will help employ veterans. The Returning Heroes Tax Credit, which provides up to $5,600 to employers, and the Wounded Warrior Tax Credit, which provides up to $9,600 to hire long-term unemployed veterans with service-connected disabilities, were recently extended for one more year in the American Taxpayer Relief Act of 2012. These credits are a part of the Work Opportunity Tax Credit (WOTC), which contains other categories targeted to hiring veterans. The Budget proposes to permanently extend the WOTC.

FYI, the WOTC program is not directly mentioned again anywhere within the 244 page budget document.

Posted in Veterans, Work Opportunity Tax Credit | No Responses »
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Tax Reform on the Horizon – Battle for WOTC and Other Incentives Looms

Friday, March 1st, 2013

Speaker of the US House of Representatives, John Boehner (R-Ohio) has recently repeated his vow to make comprehensive tax reform a top priority of the new Congress this year.  Symbolic of that end, Speaker Boehner has reserved the designation of House Resolution 1 (HR 1) for the coming tax reform bill.

“Fixing our tax code is one of my highest legislative priorities for this Congress . It’s time we shift the balance of power from the tax collector to the taxpayer.” Read more at The Hill, “Boehner: Tax reform to be H.R. 1.”

Paul Suplizio, President of the WOTC Coalition, made the observation today that given this priority, supporters of the Work Opportunity Tax Credit and other jobs-related incentives will soon face a political challenge that could easily turn against them.

“Integral to tax reform will be decisions on retaining many tax provisions that expire at year-end, including WOTC and VOW Act veterans job incentives.”

“We’ve stressed in the past that our Coalition will have to work harder than ever to keep WOTC alive when the House takes up tax reform, as the odds right now are against our winning a favorable verdict in the Ways and Means Committee.”

The remainder of Mr. Suplizio’s observations today are published here with permission.

********

Subject: President And Leaders Agree To Avoid Shutdown, Boehner Sets Course For Tax Reform

From: Paul Suplizio
Date: Fri, March 01, 2013 6:10 pm
March 1, 2013

The President and Congressional leaders didn’t resolve the sequester in their meeting today, but they did reach agreement to pass a bill funding the government for the rest of 2013, averting a government shutdown.

Both sides agreed to a measure adhering to the $1.043 trillion cap set for FY 2013 discretionary spending by the Budget Control Act of 2011, and not dealing with sequester or taxes.

The bill will more likely be a Continuing Resolution along the lines of Appropriations Chairman Rogers’ proposal in the House, which includes assured funding levels for Defense and Veterans Administration.

The President acknowledged across-the-board sequester cuts would be taken from the $1.043 trillion Continuing Resolution, so long as the sequester remains in effect.

Funding the government in an orderly manner and avoiding a shutdown means the question of mitigating the sequester remains on the table. The parties are deadlocked but channels are open—whether they’ll be used depends on who feels the most heat.

The heat’s already rising. At a press conference today, Chairman “Buck” McKeon of the House Armed Services Committee, surrounded by his subcommittee chairman, attacked the President for not forestalling the sequester, punishing service men and women. He admitted though, he had voted for sequester in 2011—not expecting the Super Committee would fail and it would come to pass.

The President’s budget for 2014 will be released in a few days, followed by House and Senate budgets next month. If the sequester is still in effect then, it will be absorbed in the struggle of dueling budgets, from which will emerge this year’s major tax and spending bills.

Two days ago Ways and Means Committee Chairman Dave Camp won a decision from Speaker Boehner to report a tax reform bill, whose broad outlines will be set by the coming Ryan budget. The Speaker’s courageous decision was taken despite fears of many Republicans that taking votes to eliminate or cap popular deductions and credits could hurt them.

Integral to tax reform will be decisions on retaining many tax provisions that expire at year-end, including WOTC and VOW Act veterans job incentives. You can read the long list of expiring provisions at the Joint Committee on Taxation’s web site, www.jct.gov, in JCX-3-13, “List of Expiring Federal Tax Provisions, 2013-2023.”

We’ve stressed in the past that our Coalition will have to work harder than ever to keep WOTC alive when the House takes up tax reform, as the odds right now are against our winning a favorable verdict in the Ways and Means Committee. Thanks to allies like Senators Baucus and Finance Committee Democrats, we may prevail in the Senate, but once the Senate goes to conference with the House to resolve their differing bills, the game can turn on a whim. We once lost the entire target group of disadvantaged youth in conference because a tobacco-state senator insisted on an excise tax cut—those jobs paid for his cut!

PAUL E. SUPLIZIO
President, WOTC Coalition

Posted in Work Opportunity Tax Credit | No Responses »
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Sequester Noise Drowning Out Concerns for Sandy Tax Relief & WOTC . . . for Now

Thursday, February 28th, 2013

You may appreciate this recent update from Paul Suplizio, President of the WOTC Coalition.  Paul reviews recent political exchanges and developments in connection with the sequester and observes how the sequester fight is drawing attention away from other important matters such as Hurricane Sandy tax relief.

You might recall, one form of tax relief under consideration for Hurricane Sandy victims is an expanded Work Opportunity Tax Credit for areas affected by the storm.

The following is published here with permission.

********

Subject: Both Sides Showing Their Hands in Sequester Fight, But No Sandy Aid
From: Paul Suplizio
Date: Wed, February 27, 2013 10:55 pm
February 27, 2013

On Monday, Senator Reid brought to the floor the Democrats anti-sequester bill, S. 388, the “American Family Economic Protection Act of 2013.” The bill defers the sequester by substituting major tax hikes and spending cuts hitting wealthy taxpayers, outsourcers, oil companies, and direct subsidy payments to farmers. Text of S.388 is available at www.thomas.gov. .

Today, Senator McConnell introduced the Senate Republicans’ reply, S. 16, dubbed “a smarter way to replace the sequester,” the product of a studious effort on the part of the Appropriations Committee’s professional staff to find ways of cutting $85 billion in FY 2013, but lessening the damage imposed by across-the-board cuts by allowing certain budget accounts to escape cuts in part or entirety, while giving Cabinet secretaries and agency heads limited discretion to move funds from lower to higher priority accounts.

The McConnell approach, if successful, would blunt some of the dire consequences the President and Democrats have been portraying for the sequester. But now both Senate leaders have dug themselves into a position from which it will be difficult for them to move—and they will carry these positions into the White House meeting of congressional leaders and the President on Friday to try to fix things.

To make matters worse, tomorrow there will be two cloture votes in the Senate, first on the McConnell bill and then on the Reid measure; there’s little doubt both will fail to muster 60 votes, so Senate leaders will be walking into the White House Friday with their immovable positions publicly paraded.

In a breakthrough, House Republicans have begun to coalesce around the bill offered by Chairman Mike Rogers of the House Appropriations Committee, which takes the same approach as the McConnell measure and which anticipated the McConnell measure by months. House Leaders spent all Wednesday sounding their caucus on the Rogers approach, and some members are commenting favorably as they think it will turn the tables on the President.

This is no small matter, since by granting flexibility in making cuts, Rogers/McConnell can be attacked for delegating to the President some portion of congressional powers to appropriate. House supporters of Rogers seem to be saying they are ready to make that concession so long as they get $85 billion in cuts.

The Rogers bill began as an Omnibus Appropriations measure for the remainder of FY 2013—this bill, or something like it, must be passed by March 27th or the government will have to shut down. As various congress people began to view it seriously, and so commenced mangling it, the bill is now converted from an Omnibus specifying budget authority for every account, to a Continuing Resolution specifying guidance for applying cuts to various accounts, so priority needs will be funded but total cuts will still come to $85 billion.

We will learn tomorrow whether Speaker Boehner will bring the House into play by adopting the Rogers approach. If he does, this means Cantor, Ryan, and the Republican Study Group (the organ of the far right) are on board, and Boehner will go into the White House meeting with a constructive position—as the saying goes, you can’t beat something with nothing. Then the White House talks will canvass who has the smarter approach—McConnell/Boehner or the President/Reid/Pelosi.

Both the Rogers and McConnell measures avert the sequester and fund the government for the remainder of the fiscal year, preventing a shutdown—we will soon learn how far the President will move: right now he wants the $85 billion in cuts deferred, and his own budget for Defense and civilian agencies enacted for the remainder of the fiscal year, plus more tax revenues.

Hurricane Sandy tax relief hasn’t been re-introduced in the 113th Congress, thus the best statement of the relief provisions sought—patterned after Katrina tax relief—remains H.R. 6683 (112th Congress), “Hurricane Sandy Tax Relief Act of 2012,” introduced last December 13th by Congressman Bill Pascrell (D-NJ). The bill extends WOTC to employers and job-seekers in the Hurricane Sandy disaster area, and has a long list of backers.

Unfortunately, the passions aroused by the sequester have blotted out serious thought of Sandy by key deciders at the moment, but the need to put tax relief into law so people hit by the hurricane will know what their tax rights are when they replace a damaged building or hire a new worker—that need will still be there.

PAUL E. SUPLIZIO
President, WOTC Coalition

Posted in Work Opportunity Tax Credit | No Responses »
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Coalition Strategy for Renewal of Expired Disconnected Youth Target Group

Wednesday, February 6th, 2013

The Work Opportunity Tax Credit (WOTC) target group known as Disconnect Youth was created by the American Recovery and Reinvestment Tax Act of 2009. (See “New WOTC Tax Credit Opportunities Arise from Stimulus Bill”) 

For purposes of WOTC eligibility, a disconnected youth is someone who at the time of hire: (1) is between the ages of 16 and 24 inclusive, (2) is not regularly attending any secondary, technical, or post-secondary school during the 6-month period prior to hire, (3) is not regularly employed during the same 6-month period, and (4) is not readily employable by reason of lacking a sufficient number of basic skills.

While very successful as part of the work opportunity program, it was also very short lived. An expiration date of December 31, 2010 was built in from its beginning. Since that time, however, many of us have held out hope that the Disconnect Youth target group would be renewed. The WOTC Coalition, among others, has been pressing for its renewal.

Early this morning, I received the following correspondence from Paul Suplizio, President of the WOTC Coalition. In it, Paul addresses current efforts to restore the Disconnected Youth target group. It is published here with permission.

*******

From: “Paul Suplizio”
Date: Wed, February 06, 2013 1:13 am
Subject: WOTC Disconnected Youth Target Group

February 6, 2013

Since expiration of the disconnected youth target group in 2010, our Coalition has been pressing for its restoration. “Disconnected youth,” broadly defined as youth ages 16 through 24 who are out of school and out of work, are approaching 7 million in number today. In the brief 18 months of 2009-2010 when they were a WOTC target group, 362,561 disconnected youth found jobs, and we were easily on the way to a half million a year when their target group was terminated.

Our Coalition’s efforts helped bring about appointment of an inter-agency task force, headed by OMB, in 2011, and a “request for information” was sent to around 800 government agencies and NGO’s, culminating in a webinar conference in June of last year that, regrettably, hasn’t produced much so far. Our dialogue with OMB staff has continued since that time, with the goal of getting the President to address the serious disconnected youth problem in the Fiscal Year 2014 budget, and propose WOTC as the solution.

We are enclosing a copy of our latest message to OMB, sent on January 31st.

We haven’t received a reply to this message and don’t expect one till after release of the President’s budget.

Regardless of the budget, we will go all out way for restoration of disconnected youth this year. If there’s a sequester deal between now and March 1st, we will have a chance to get in the deal. Please bring this up with your White House contacts and ask them to support it—no need to ask them to extend WOTC, just present disconnected youth as major labor force problem that needs to be addressed, that restoring it in the jobs tax credit which proved very effective in 2009-2010 makes sense and should be included in the President’s proposals.

You should also bring it to attention of Majority Leader Harry Reid, Senate Finance Committee Chairman Max Baucus, and ask other Finance Committee senators to urge Senator Baucus to get it in the Democrats’ revenue proposals for a sequester deal. Senator Reid wants revenue in any sequester bill, so if the political stars align, there may be a tax title which can carry both disconnected youth and Hurricane Sandy WOTC to passage.

If sequester doesn’t work, we’ll try again on the next tax vehicle to come along.

We will keep you informed.

PAUL E. SUPLIZIO
President, WOTC Coalition

Posted in Disconnected Youth, Work Opportunity Tax Credit | No Responses »
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More on the US Senate’s Fiscal Cliff Bill and Tax Extenders

Tuesday, January 1st, 2013

This update from Paul Suplizio, President of the WOTC Coalition, offers some additional details about the fiscal cliff bill passed by the Senate late tonight.

Contrary to my earlier observations, Paul states that the bill DOES include VOW to Hire Hero provisions in its extension of the Work Opportunity Tax Credit. Hopefully, I was wrong.  I like Paul’s version better.

Paul also makes some important observations about recent Hurricane Sandy relief efforts —  including a proposal to expand the WOTC Program with a new Hurricane Sandy target group.

The following is published here with permission (emphasis is from the original).

*********

From: Paul Suplizio
Sent: Tuesday, January 1, 2013 1:18 AM
Subject: Senate Passes Fiscal Cliff Bill With WOTC And Other Extenders

January 1, 2013  3:00 AM EDT

The Senate passed the fiscal cliff bill, H.R. 8, a little after 2:00 AM this morning, by a vote of 89-8.

Republicans swarmed Senator McConnell to congratulate him, and Senator Reid added his appreciation as well. McConnell notably made the point that 99% of citizens of Kentucky won’t see their taxes go up this year (he didn’t mention payroll tax relief was allowed to expire, so every worker will get less in his or her pay check.)

Democrats claimed victory for winning tax hikes and renewal of several of the President’s signature programs (American Opportunity Act, Child Tax Credit, EITC expansion), apparently enough in the deal to satisfy most everyone—the mark of a good compromise.

The bill contains a retroactive WOTC extension through December 31st, 2013. The bill also extends retroactively through 2013 all other extenders of the bi-partisan Baucus/Hatch bill, S. 3521, that all of us worked so hard for last July and August.

Tax code provisions expiring yesterday were also continued for the coming year.

Importantly related to WOTC and extended through 2013 are empowerment zones, Indian employment tax credit, employer child care tax credit, and WOTC veterans provisions enacted in the VOW Act.

The House will take up the bill tomorrow, along with Hurricane Sandy relief, and senators are remaining in town to vote on any House amendments.

Republicans voting against the fiscal cliff deal were Lee, Paul, Shelby, Rubio, and Grassley. Democrats against were Bennett of Colorado, Harkin, and Carper.

There are many reasons for this success, but basically, thanks to your efforts, our friends including the White House held firm for the tax extenders and never flinched. This wasn’t easy, for the $70 billion cost had to be offset, and this could only be achieved by reducing the nearly one trillion in new revenue resulting from the higher tax rates in the bill.

Unemployment compensation, Medicare doctors’ payments, and a farm bill extension (to avert a leap in milk price) were also included in the bill.

For the first time in more than three decades, AMT relief was made permanent and will not have to undergo annual extension in the future.

Happy New Year and many thanks to all, however it’s still too early to break out the champagne!

Note: We’ve been trying to put into the Hurricane Sandy relief bill a WOTC credit like Katrina. However, Leader Reid’s decision was to keep the Senate bill “clean,” that is, dealing only with appropriations for relief, not tax cuts. The Sandy bill passed by the Senate is unacceptable to the House, which is scheduled to pass an amendment with far less money, but possibly with tax relief, tomorrow. If that occurs, the bill is expected to come back to the Senate where we may have a chance of pressing for Katrina-like tax relief.

 

PAUL E. SUPLIZIO
President, WOTC Coalition

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WOTC and Tax Extenders are In! – Deal Not Yet Final

Monday, December 31st, 2012

Within the past hour, news is hitting the wires of a fiscal cliff deal in sight.  ABC News.  CNN.

We have it from Paul Suplizio of the WOTC Coalition that tax extenders, including WOTC, have made it into the deal retroactive through 2013.

The following is published here with permission.

*******

From: Paul Suplizio
Sent: Monday, December 31, 2012 11:59 AM
Subject: Tentative Deal Extends WOTC and Tax Extenders To End of 2013

December 31, 2012

2: 30 PM EDT

A fiscal cliff deal is all but sealed, but negotiations are continuing so nothing is certain till we see the final bill.

The energy extenders were used by Republicans as a bargaining chip to try to get concessions from the White House, but in the end all extenders are continued retroactively to the end of 2013 as the tentative deal now stands.

The President mentioned the tuition tax credit and clean energy tax credits as being part of the deal in remarks this afternoon.

We will keep you informed.

PAUL E. SUPLIZIO
President, WOTC Coalition

 

 

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Increasing Confidence that WOTC and Extenders Will Be Included in Compromise Bill

Saturday, December 29th, 2012

The latest news on fiscal cliff negotiations, as published today by USA Today and ABC News is cautiously pessimistic about Congress’ ability to work out an acceptable compromise before Monday.  The following video is a good 5-minute summary from ABC News today.

 

What of Tax Extenders and WOTC?

This morning’s impressions from Paul Suplizio, President of the WOTC Coalition, however,  are optimistic when it comes to the tax extenders and a renewal of the Work Opportunity Tax Credit.

“We are growing more confident WOTC and other tax extenders will be included in any compromise.”

The following correspondence is published here with permission.

********
From: Paul Suplizio

Sent: Saturday, December 29, 2012 9:29 AM
Subject: Senate and House Could Vote Sunday On Compromise Including WOTC

December 29, 2012

Majority Leader Harry Reid and Minority Leader Mitch McConnell have scheduled meetings of their caucuses tomorrow afternoon to review the compromise plan they’ve agreed to, assuming they’ve been able to reach agreement.

Reid is writing the measure and taking input from McConnell on priorities Republicans want in the bill—this means tough negotiations today and tomorrow, which won’t be final till Reid has called the President and gotten his approval of the deal.

We are growing more confident WOTC and other tax extenders will be included in any compromise.

After the Democratic and Republican caucus meetings Sunday afternoon, the Senate can start voting immediately on the compromise bill.

If passed by the Senate, the bill will go immediately to the House. Normally, the Speaker decides whether to take up a bill or not. However, in Friday’s meeting with Reid, McConnell, and the President, Boehner pledged the House would consider any Senate-passed bill.

House Republicans can bring any amendments they wish, and the full House will vote on them. If any amendment passes, the bill will go back to the Senate for acceptance or rejection, and so on until both Houses pass the same version.

PAUL E. SUPLIZIO
President, WOTC Coalition

 

 

 

 

Posted in Work Opportunity Tax Credit | No Responses »
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If Republicans “Take the Deal” WOTC and Extenders Will Renew for 2012, 2013

Wednesday, December 19th, 2012

President Obama’s remarks this morning on his “fiscal cliff” negotiations with House Republicans signals optimism that a deal may be close.  Both sides have made concessions but continue to push for additional concession from the other. Near the end of his remarks this morning, the President said,

“I remain optimistic, because if you look at what the speaker has proposed, he’s conceded that income tax rates should go up . . . I’ve said I’m willing to make some cuts. What separates us is probably a few hundred billion dollars. The idea that we would put our economy at risk because you can’t bridge that cap doesn’t make a lot of sense.”

And a little later,

At some point there’s got to be I think a recognition on the part of my Republican friends that, you know, take the deal.

Read the entire transcript in the Washington Post.

Paul Suplizio, President of the WOTC Coalition, took in the Presidents remarks today.  We have his observations, published here with permission.

**********

From: Paul Suplizio
Sent: Wednesday, December 19, 2012 10:14 AM
Subject: President Tells Republicans, “Take The Deal”

December 19, 2012

12:41 PM EDT

President Obama took questions on the fiscal cliff at his press conference today.

He said he’s reaching out to Republicans and understands their difficulty, but he’s met them half-way, “So, take the deal!”

These comments came after the White House issued a statement saying the President would veto Plan B, and The Speaker’s office replied, “Statements from the White House are increasingly irrational.”

A vote on Plan B is scheduled for tomorrow (Thursday) in the House; to pass a bill before Christmas, a deal needs to come Thursday night or Friday.

If there’s no deal, expect Congress returning and negotiations continuing after Christmas.

To clarify the situation: if Republicans take the President’s latest offer, WOTC and tax extenders would be renewed for 2012 and 2013.

PAUL E. SUPLIZIO
President, WOTC Coalition

 

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“Plan B” Action Alert – Support Inclusion of Tax Extenders in House Tax Bill

Tuesday, December 18th, 2012

If you’ve been listening to talk radio or the news this morning, you will have already heard House Speaker John Boehner’s talking about the House’s “Plan B” tax bill.  The White House has already rejected the Plan B proposal and it is expected to also die in the Senate.  Nevertheless, the bill is important because it will outline what is important to House Republicans and will potentially set a baseline for supporting tax extenders in subsequent bills.

I received this action alert  just minutes ago from Paul Suplizio, President of the WOTC Coalition.  It is published here with permission.

********

From: Paul Suplizio
Sent: Tuesday, December 18, 2012 12:02 PM
Subject: Action Required on House Republicans’ Plan B

December 18, 2012

After meeting with House Republicans this morning, Speaker Boehner announced that—while continuing to engage in negotiations with the President—the House would take up and pass a “Plan B” tax bill that will extend all Bush tax cuts while increasing the rate on taxable income above $1 million to 39.6 percent.

Speaker Boehner has been under a lot of pressure from members to do something they can carry home to their constituents when they return for the holidays. The main purpose of Plan B is to placate them, it will die in the Senate.

Nevertheless, Plan B will be the foremost, definitive, and final statement of House Republicans of the 112th Congress on tax policy. From our standpoint, the House has gone the entire duration of the 112th Congress leaving tax code provisions expired without any attempt to address this issue in an extension bill. They now have, in the Republican majority’s final declaration on tax policy, an opportunity to set things right.

Accordingly, our advice is to continue pressing House leaders to support WOTC and other tax extenders by communicating with Republicans along the following lines:

“On December 18, Speaker Boehner announced the House would soon vote on Plan B to extend the Bush tax cuts for most Americans. Businesses and workers and families we represent have been pleading with the House for the better part of two years to pass a bill extending expired or about to expire provisions of the tax code, such as the work opportunity tax credit. We have suffered financial loss and those we assist have suffered loss of services as a result. Uncertainty on taxes has spread through the economy. Yet the House has gone the entire period without taking a stand on renewal of the tax extenders in any bill brought to the floor. Plan B will be the last opportunity to take action on renewal of the work opportunity tax credit for the disabled, youth, and veterans, as well as renewal of many other worthwhile tax code provisions that deserve to be included in this final measure. Please contact House leaders and urge them to take this opportunity to assure WOTC and other tax extenders are included in the Plan B legislation to be brought soon before the House.”

Plan B will be voted on in the next two or three days. After that, if there’s a deal that includes WOTC and extenders, Plan B will be history and the 112th will have redeemed itself. We still expect a deal—Republicans have already won a victory by holding down the capital gains and dividends tax increases and holding the top rate to incomes above $400,000. Extenders aren’t assured yet, please stay engaged.

PAUL E. SUPLIZIO
President, WOTC Coalition

Posted in Work Opportunity Tax Credit | No Responses »
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Negotiation Gap Narrows as Obama’s Offers Continue to Include WOTC

Tuesday, December 18th, 2012

As the tax and spend negotiations continue, President Obama’s most recent offer on Monday included an extension of the Work Opportunity Tax Credit program and other tax extenders.  This has been consistent while the public focus of the negotiations has been on areas of deeper disagreement. Already this morning, the White House rejected House Speaker Boehner’s counter offer.

We have correspondence this morning from Paul Suplizio, President of the WOTC Coalition, with encouragement for those hoping to see the tax extenders included in any compromise hammered out by House Republicans and the Obama Administration.  Our emphasis for action should be to build a “pro-extenders’ fire under House Republicans and their leaders.”

The following is published here with permission.  (Emphasis in bold is from the original.)

*******

From: Paul Suplizio
Sent: Tuesday, December 18, 2012 5:38 AM
Subject: President Makes Comprehensive New Offer Including Tax Extenders

December 18, 2012

Yesterday, the President proposed a 39.6 percent marginal rate on income of joint tax filers above $400,000, withdrawing his previous demand to apply that rate to income above $250,000.

This latest offer to Speaker Boehner is part of a comprehensive deficit-reduction package that includes extension of WOTC and other tax extenders.

The Speaker isn’t satisfied with the offer and negotiations are continuing. The Speaker will meet with House Republicans this morning to report on the talks and get their reaction.

The President’s offer includes a 20 percent tax rate on capital gains and dividends, up from the current 15 percent, and a 45% estate tax (Republicans want the rate to be no more than 35%).

The President wants $50 billion in infrastructure spending, $30 billion to extend unemployment benefits, permanent AMT relief, and permanent Medicare doctors’ relief from scheduled cuts.

On entitlements, the President proposed using the so-called “chained CPI” for annual Social Security and pension cost-of-living increases, plus other savings in entitlement programs.

On spending, the sequester would be delayed and there would be further cuts in discretionary programs including defense.

The President wants the right to set the debt ceiling for another two years under the McConnell rule. The Speaker has already offered one year.

No other details are available on the tax extenders except they continue to be included in each offer made by the President.

Please continue your contacts. These talks could go till the end of the month—we need to continue building a pro-extenders’ fire under House Republicans and their leaders.

PAUL E. SUPLIZIO
President, WOTC Coalition

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