Legislative update: House passes trade bill, includes tax provisions

House passes trade bill, includes tax provisions

The House today passed (397-32) H.R. 1258, the Trade Preferences Extension Act of 2015, which addresses a number of expiring trade items.

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The bill also includes a number of tax-related provisions as revenue offsets, including measures that would provide for:

  • Significant increases (in many cases, doubling or tripling) in penalties for failure to file correct information returns under section 6721
  • Significant increases (in many cases, doubling or tripling) in penalties for failure to furnish correct payee statements under section 6722
  • Modifications to the due dates of some corporate estimated tax payments due in 2020
  • Requiring taxpayers claiming the American Opportunity, Hope Scholarship, and Lifetime Learning education credits or deductions for Qualified Tuition and related expenses to receive a statement provided by the educational institution regarding qualified expenses in order to claim the tax benefits

What’s next?

The Senate previously had passed a version of the trade bill, but the House changed the text of the Senate bill. Thus, the Senate needs to pass the identical version of the bill that passed the House before the legislation can be presented to the president for signature. It is unclear when the Senate will act on the House bill.

KPMG observation

The House bill does not include a provision from the Senate bill that would have increased the reporting requirements of certain financial institutions. This provision: (1) would have eliminated the current de minimis ($10) exemption for the filing of annual statements reporting on interest-bearing accounts; and (2) would have required certain financial institutions to file information returns regarding many non-interest bearing accounts.

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