Tax Notes logo

Joint Committee Report JCS-1-16: General Explanation of Tax Legislation Enacted in the 114th Congress

MAR. 1, 2016

JCS-1-16

DATED MAR. 1, 2016
DOCUMENT ATTRIBUTES
Citations: JCS-1-16

 

CONTENTS

 

 

INTRODUCTION

 

 

PART ONE: SLAIN OFFICER FAMILY SUPPORT ACT OF 2015 (PUBLIC LAW 114-7)

 

 

PART TWO: MEDICARE ACCESS AND CHIP REAUTHORIZATION ACT OF 2015 (PUBLIC LAW 114-10)

 

 

PART THREE: DON'T TAX OUR FALLEN PUBLIC SAFETY HEROES ACT (PUBLIC LAW 114-14)

 

 

PART FOUR: HIGHWAY AND TRANSPORTATION FUNDING ACT OF 2015 (PUBLIC LAW 114-21)

 

 

A. Extension of Highway Trust Fund Expenditure Authority (sec. 2001 of the Act and secs. 9503, 9504, and 9508 of the Code)
PART FIVE: DEFENDING PUBLIC SAFETY EMPLOYEES' RETIREMENT ACT (PUBLIC LAW 114-26)

 

 

PART SIX: TRADE PREFERENCES EXTENSION ACT OF 2015 (PUBLIC LAW 114-27)

 

 

TITLE IV -- EXTENSION OF TRADE ADJUSTMENT ASSISTANCE

 

 

A. Extension and Modification of Health Coverage Tax Credit (sec. 407 of the Act and sec. 35 of the Code)
TITLE VIII -- OFFSETS

 

 

PART SEVEN: SURFACE TRANSPORTATION AND VETERANS HEALTH CARE CHOICE IMPROVEMENT ACT OF 2015 (PUBLIC LAW 114-41)

 

 

TITLE II -- REVENUE PROVISIONS

 

 

A. Extension of Highway Trust Fund Expenditure Authority (sec. 2001 of the Act and secs. 9503, 9504, and 9308 of the Code)

B. Funding of Highway Trust Fund (sec. 2002 of the Act and sec. 9503(f) of the Code)

C. Modification of Mortgage Reporting Requirements (sec. 2003 of the Act and sec. 6050H of the Code)

D. Consistent Basis Reporting between Estate and Person Acquiring Property from Decedent (sec. 2004 of the Act and secs. 1014 and 6035 of the Code)

E. Clarification of 6-Year Statute of Limitations in Case of Overstatement of Basis (sec. 2005 of Act and sec. 6501 of the Code)

F. Tax Return Due Date Simplification (sec. 2006 of the Act and secs. 6071, 6072, and 6081 of the Code)

G. Transfers of Excess Pension Assets to Retiree Health Accounts (sec. 2007 of the Act and sec. 420 of the Code)

H. Equalization of Highway Trust Fund Excise Taxes on Liquefied Natural Gas, Liquefied Petroleum Gas, and Compressed Natural Gas (sec. 2008 of the Act and sec. 4041 of the Code)

TITLE IV -- VETERANS PROVISIONS

 

 

PART EIGHT: AIRPORT AND AIRWAY EXTENSION ACT OF 2015 (PUBLIC LAW 114-55)

 

 

A. Extension of Spending Authority and Taxes Funding Airport and Airway Trust Fund (secs. 201 and 202 of the Act and secs. 4083, 4801, 4261, 4271, and 9502 of the Code)
PART NINE: SURFACE TRANSPORTATION EXTENSION ACT OF 2015 (PUBLIC LAW 114-73)

 

 

A. Extension of Highway Trust Fund Expenditure Authority (sec. 2001 of the Act and secs. 9503, 9504, and 9508 of the Code)
PART TEN: BIPARTISAN BUDGET ACT OF 2015 (PUBLIC LAW 114-74)

 

 

TITLE V -- PENSIONS

 

 

A. Mortality Tables and Extension of Current Funding Stabilization Percentages to 2018, 2019, and 2020 (secs. 503-504 of the Act, sec. 430 of the Code, and secs. 101(f) and 303 of ERISA)
TITLE XI -- REVENUE PROVISIONS RELATED TO TAX COMPLIANCE

 

 

A. Partnership Audits and Adjustments (sec. 1101 of the Act and secs. 6221-6241 of the Code)

B. Partnership Interests Created by Gift (sec. 1102 of the Act and secs. 704(e) and 761(b) of the Code)

PART ELEVEN: SURFACE TRANSPORTATION EXTENSION ACT OF 2015, PART II (PUBLIC LAW 114-87)

 

 

A. Extension of Highway Trust Fund Expenditure Authority (sec. 2001 of the Act and secs. 9503, 9504, and 9508 of the Code)
PART TWELVE: FIXING AMERICA'S SURFACE TRANSPORTATION ACT ("FAST ACT") (PUBLIC LAW 114-94)

 

 

DIVISION C -- FINANCE

 

 

TITLE XXXI -- HIGHWAY TRUST FUND AND RELATED TAXES

 

 

A. Extension of Highway Trust Fund Expenditure Authority (secs. 31101 of the Act and secs. 9503, 9504, and 9508 of the Code)

B. Extension of Highway-Related Taxes (sec. 31102 of the Act and secs. 4041, 4051, 4071, 4081, 4221, 4481, 4483, and 6412 of the Code)

C. Additional Transfers to the Highway Trust Fund (sec. 31201 of the Act and sec. 9503 of the Code)

D. Transfer to Highway Trust Fund of Certain Motor Vehicle Safety Penalties (sec. 31202 of the Act and sec. 9503 of the Code)

E. Appropriation From Leaking Underground Storage Tank Trust Fund (sec. 31203 of the Act and secs. 9503 and 9508 of the Code)

TITLE XXXII -- OFFSETS

 

 

A. Revocation or Denial of Passport in Case of Certain Unpaid Taxes (sec. 32101 of the Act and secs. 6320, 6331, 7345 and 6103(k)(11) of the Code)

B. Reform of Rules Related to Qualified Tax Collection Contracts, and Special Compliance Personnel Program (secs. 32102-32103 of the Act and sec. 6306 of the Code)

C. Repeal of Modification of Automatic Extension of Return Due Date for Certain Employee Benefit Plans (sec. 32104 of the Act and secs. 6058 and 6059 of the Code)

PART THIRTEEN: CONSOLIDATED APPROPRIATIONS ACT, 2016 (PUBLIC LAW 114-113)

 

 

DIVISION P -- TAX-RELATED PROVISIONS

 

 

A. High Cost Employer-Sponsored Health Coverage Excise Tax (secs. 101-103 of the Act and sec. 4980I of the Code)

B. Annual Fee on Health Insurance Providers (sec. 201 of the Act and sec. 9010 of the Patient Protection and Affordable Care Act)

C. Miscellaneous Provisions

 

1. Extension and phaseout of credits with respect to facilities producing electricity from wind (secs. 301-302 of the Act and secs. 45 and 48 of the Code)

2. Modification of energy investment credit (sec. 303 of the Act and sec. 48 of the Code)

3. Credit for residential energy efficient property (section 304 of the Act and 25D of the Code)

4. Treatment of transportation costs of independent refiners (sec. 305 of the Act and sec. 199 of the Code)

DIVISION Q -- PROTECTING AMERICANS FROM TAX HIKES ACT OF 2015

 

 

TITLE I -- EXTENDERS

 

 

A. Permanent Extensions

 

1. Reduced earnings threshold for additional child tax credit made permanent (sec. 101 of the Act and sec. 24 of the Code)

2. American opportunity tax credit made permanent (sec. 102 of the Act and sec. 25A of the Code)

3. Modification of the earned income tax credit made permanent (sec. 103 of the Act and sec. 32 of the Code)

4. Extension and modification of deduction for certain expenses of elementary and secondary school teachers (sec. 104 of the Act and sec. 62(a)(2)(D) of the Code)

5. Extension of parity for exclusion from income for employer-provided mass transit and parking benefits (sec. 105 of the Act and 132(f) of the Code)

6. Deduction for State and local sales taxes (sec. 106 of the Act and sec. 164 of the Code)

7. Special rule for qualified conservation contributions made permanent (sec. 111 of the Act and sec. 170(b) of the Code)

8. Tax-free distributions from individual retirement plans for charitable purposes (sec. 112 of the Act and sec. 408(d)(8) of the Code)

9. Extension and expansion of charitable deduction for contributions of food inventory (sec. 113 of the Act and sec. 170 of the Code)

10. Extension of modification of tax treatment of certain payments to controlling exempt organizations (sec. 114 of the Act and sec. 512 of the Code)

11. Extension of basis adjustment to stock of S corporations making charitable contributions of property (sec. 115 of the Act and sec. 1367 of the Code)

12. Extension and modification of research credit (sec. 121 of the Act and secs. 38 and 41 and new sec. 3111(f) of the Code)

13. Extension and modification of employer wage credit for employees who are active duty members of the uniformed services (sec. 122 of the Act and sec. 45P of the Code)

14. Extension of 15-year straight-line cost recovery for qualified leasehold improvements, qualified restaurant buildings and improvements, and qualified retail improvements (sec. 123 of the Act and sec. 168 of the Code)

15. Extension and modification of increased expensing limitations and treatment of certain real property as section 179 property (sec. 124 of the Act and sec. 179 of the Code)

16. Extension of treatment of certain dividends of regulated investment companies (sec. 125 of the Act and sec. 871(k) of the Code)

17. Extension of exclusion of 100 percent of gain on certain small business stock (sec. 126 of the Act and sec. 1202 of the Code)

18. Extension of reduction in S corporation recognition period for built-in gains tax (sec. 127 of the Act and sec. 1374 of the Code)

19. Extension of subpart F exception for active financing income (sec. 128 of the Act and secs. 953 and 954 of the Code)

20. Extension of temporary minimum low-income housing tax credit rate for non-Federally subsidized buildings (sec. 131 of the Act and sec. 42 of the Code)

21. Extension of military housing allowance exclusion for determining whether a tenant in certain counties is low-income (sec. 132 of the Act and secs. 42 and 142 of the Code)

22. Extension of RIC qualified investment entity treatment under FIRPTA (sec. 133 of the Act and secs. 897 and 1445 of the Code)

 

B. Extensions Through 2019

 

1. Extension of new markets tax credit (sec. 141 of the Act and sec. 45D of the Code)

2. Extension and modification of work opportunity tax credit (sec. 142 of the Act and secs. 51 and 52 of the Code)

3. Extension and modification of bonus depreciation (sec. 143 of the Act and sec. 168(k) of the Code)

4. Extension of look-through treatment of payments between related controlled foreign corporations under foreign personal holding company rules (sec. 144 of the Act and sec. 954(c)(6) of the Code)

 

C. Extensions Through 2016

 

1. Extension and modification of exclusion from gross income of discharges of acquisition indebtedness on principal residences (sec. 151 of the Act and sec. 108 of the Code)

2. Extension of mortgage insurance premiums treated as qualified residence interest (sec. 152 of the Act and sec. 163 of the Code)

3. Extension of above-the-line deduction for qualified tuition and related expenses (sec. 153 of the Act and sec. 222 of the Code)

4. Extension of Indian employment tax credit (sec. 161 of the Act and sec. 45A of the Code)

5. Extension and modification of railroad track maintenance credit (sec. 162 of the Act and sec. 45G of the Code)

6. Extension of mine rescue team training credit (sec. 163 of the Act and sec. 45N of the Code)

7. Extension of qualified zone academy bonds (sec. 164 of the Act and sec. 54E of the Code)

8. Extension of classification of certain race horses as three-year property (sec. 165 of the Act and sec. 168 of the Code)

9. Extension of seven-year recovery period for motorsports entertainment complexes (sec. 166 of the Act and sec. 168 of the Code)

10. Extension and modification of accelerated depreciation for business property on an Indian reservation (sec. 167 of the Act and sec. 168(j) of the Code)

11. Extension of election to expense mine safety equipment (sec. 168 of the Act and sec. 179E of the Code)

12. Extension of special expensing rules for certain film and television productions; special expensing for live theatrical productions (sec. 169 of the Act and sec. 181 of the Code)

13. Extension of deduction allowable with respect to income attributable to domestic production activities in Puerto Rico (sec. 170 of the Act and sec. 199 of the Code)

14. Extension and modification of empowerment zone tax incentives (sec. 171 of the Act and secs. 1391 and 1394 of the Code)

15. Extension of temporary increase in limit on cover over of rum excise taxes to Puerto Rico and the Virgin Islands (sec. 172 of the Act and sec. 7652(f) of the Code)

16. Extension of American Samoa economic development credit (sec. 173 of the Act and sec. 119 of Pub. L. No. 109-432)

17. Suspension of medical device excise tax (sec. 174 of the Act and sec. 4191 of the Code)

18. Extension and modification of credit for nonbusiness energy property (sec. 181 of the Act and sec. 25C of the Code)

19. Extension of credit for alternative fuel vehicle refueling property (sec. 182 of the Act and section 30C of the Code)

20. Extension of credit for electric motorcycles (sec. 183 of the Act and sec. 30D of the Code)

21. Extension of second generation biofuel producer credit (sec. 184 of the Act and sec. 40(b)(6) of the Code)

22. Extension of biodiesel and renewable diesel incentives (sec. 185 of the Act and ec. 40A of the Code)

23. Extension of credit for the production of Indian coal facilities (sec. 186 of the Act and sec. 45 of the Code)

24. Extension of credits with respect to facilities producing energy from certain renewable resources (sec. 187 of the Act and secs. 45 and 48 of the Code)

25. Extension of credit for energy-efficient new homes (sec. 188 of the Act and sec. 45L of the Code)

26. Extension of special allowance for second generation biofuel plant property (sec. 189 of the Act and sec. 168(l) of the Code)

27. Extension of energy efficient commercial buildings deduction (sec. 190 of the Act and sec. 179D of the Code)

28. Extension of special rule for sales or dispositions to implement FERC or State electric restructuring policy for qualified electric utilities (sec. 191 of the Act and sec. 451(i) of the Code)

29. Extension of excise tax credits and payment provisions relating to alternative fuel (sec. 192 of the Act and secs. 6426 and 6427 of the Code)

30. Extension of credit for fuel cell vehicles (sec. 193 of the Act and sec. 30B of the Code)

TITLE II -- PROGRAM INTEGRITY

 

 

1. Modification of filing dates of returns and statements relating to employee wage information and nonemployee compensation to improve compliance (sec. 201 of the Act and secs. 6071 and 6402 of the Code)

2. Safe harbor for de minimis errors on information returns, payee statements, and withholding (sec. 202 of the Act and secs. 6721 and 6722 of the Code)

3. Requirements for the issuance of ITINs (sec. 203 of the Act and sec. 6109 of the Code)

4. Prevention of retroactive claims of earned income credit, child tax credit, and American Opportunity Tax Credit (secs. 204, 205, and 206 of the Act and secs. 24, 25A and 32 of the Code)

5. Procedures to reduce improper claims (sec. 207 of the Act and secs. 24, 25A, 32, and 6695 of the Code)

6. Restrictions on taxpayers who improperly claimed credits in prior year (sec. 208 of the Act and secs. 24, 25A and 6213 of the Code)

7. Treatment of credits for purposes of certain penalties (sec. 209 of the Act and secs. 6664 and 6676 of the Code)

8. Increase the penalty applicable to paid tax preparers who engage in willful or reckless conduct (sec. 210 of the Act and sec. 6694 of the Code)

9. Employer identification number required for American opportunity tax credit (sec. 211 of the Act and secs. 25A and 6050S of the Code)

10. Higher education information reporting only to include qualified tuition and related expenses actually paid (sec. 212 of the Act and sec. 6050S of the Code)

TITLE III -- MISCELLANEOUS PROVISIONS

 

 

A. Family Tax Relief

 

1. Exclusion for amounts received under the work colleges program (sec. 301 of the Act and sec. 117 of the Code)

2. Modification of rules relating to section 529 programs (sec. 302 of the Act and sec. 529 of the Code)

3. Modification to qualified ABLE programs (sec. 303 of the Act and sec. 529A of the Code)

4. Exclusion from gross income of certain amounts received by wrongly incarcerated individuals (sec. 304 of the Act and new sec. 139F of the Code)

5. Clarification of special rule for certain governmental plans (sec. 305 of the Act and sec. 105(j) of the Code)

6. Rollovers permitted from other retirement plans into SIMPLE retirement accounts (sec. 306 of the Act and sec. 408(p)(1)(B) of the Code)

7. Technical amendment relating to rollover of certain airline payment amounts (sec. 307 of the Act and sec. 1106 of the FAA Modernization and Reform Act of 2012)

8. Treatment of early retirement distributions for nuclear materials couriers, United States Capitol Police, Supreme Court Police, and diplomatic security special agents (sec. 308 of the Act and sec. 72(t) of the Code)

9. Prevention of extension of tax collection period for members of the Armed Forces who are hospitalized as a result of combat zone injuries (sec. 309 of the Act and secs. 6502 and 7508(e) of the Code)

 

B. Real Estate Investment Trusts

 

1. Restriction on tax-free spinoffs involving REITs (sec. 311 of the Act and secs. 355 and 856 of the Code)

2. Reduction in percentage limitation on assets of REIT which may be taxable REIT subsidiaries (sec. 312 of the Act and sec. 856 of the Code)

3. Prohibited transaction safe harbors (sec. 313 of the Act and sec. 857 of the Code)

4. Repeal of preferential dividend rule for publicly offered REITS; authority for alternative remedies to address certain REIT distribution failures (secs. 314 and 315 of the Act and sec. 562 of the Code)

5. Limitations on designation of dividends by REITs (sec. 316 of the Act and sec. 857 of the Code)

6. Debt instruments of publicly offered REITs and mortgages treated as real estate assets (sec. 317 of the Act and sec. 856 of the Code)

7. Asset and income test clarification regarding ancillary personal property (sec. 318 of the Act and sec. 856 of the Code)

8. Hedging provisions (sec. 319 of the Act and sec. 857 of the Code)

9. Modification of REIT earnings and profits calculation to avoid duplicate taxation (sec. 320 of the Act and secs. 562 and 857 of the Code)

10. Treatment of certain services provided by taxable REIT subsidiaries (sec. 321 of the Act and sec. 857 of the Code)

11. Exception from FIRPTA for certain stock of REITs; exception for interests held by foreign retirement and pension funds (secs. 322 and 323 of the Act and secs. 897 and 1445 of the Code)

12. Increase in rate of withholding of tax on dispositions of United States real property interests (sec. 324 of the Act and sec. 1445 of the Code)

13. Interests in RICs and REITs not excluded from definition of United States real property interests (sec. 325 of the Act and sec. 897 of the Code)

14. Dividends derived from RICs and REITs ineligible for deduction for United States source portion of dividends from certain foreign corporations (sec. 326 of the Act and sec. 245 of the Code)

 

C. Additional Provisions

 

1. Provide special rules concerning charitable contributions to, and public charity status of, agricultural research organizations (sec. 331 of the Act and secs. 170(b) and 501(h) of the Code)

2. Remove bonding requirements for certain taxpayers subject to Federal excise taxes on distilled spirits, wine, and beer (sec. 332 of the Act and secs. 5061(d), 5173(a), 5351, 5401 and 5551 of the Code)

3. Modification to alternative tax for certain small insurance companies (sec. 333 of the Act and sec. 831(b) of the Code)

4. Treatment of timber gains (sec. 334 of the Act and sec. 1201 of the Code)

5. Modification of definition of hard cider (sec. 335 of the Act and sec. 5041 of the Code)

6. Church plan clarification (sec. 336 of the Act and sec. 414 of the Code)

 

D. Revenue Provisions
TITLE IV -- TAX ADMINISTRATION

 

 

A. Internal Revenue Service Reforms

 

1. Duty to ensure that Internal Revenue Service employees are familiar with and act in accordance with certain taxpayer rights (sec. 401 of Act and sec. 7803 of the Code)

2. Prohibition of use of personal e-mail for official government business (sec. 402 of the Act)

3. Release of information regarding the status of certain investigations (sec. 403 of the Act and sec. 6103 of the Code)

4. Require the Secretary of the Treasury to describe administrative appeals procedures relating to adverse determinations of tax-exempt status of certain organizations (sec. 404 of the Act and sec. 7123 of the Code)

5. Require section 501(c)(4) organizations to provide notice of formation (sec. 405 of the Act, secs. 6033 and 6652 of the Code, and new sec. 506 of the Code)

6. Declaratory judgments for section 501(c)(4) and other exempt organizations (sec. 406 of the Act and sec. 7428 of the Code)

7. Termination of employment of Internal Revenue Service employees for taking official actions for political purposes (sec. 407 of the Act and sec. 1203(b) of the Internal Revenue Service Restructuring and Reform Act of 1998)

8. Gift tax not to apply to gifts made to certain exempt organizations (sec. 408 of the Act and sec. 2501(a) of the Code)

9. Extend the Internal Revenue Service authority to require a truncated Social Security Number ("SS") on Form W-2 (sec. 409 of the Act and sec. 6051 of the Code)

10. Clarification of enrolled agent credentials (sec. 410 of the Act)

11. Partnership audit rules (sec. 411 of the Act and secs. 6225, 6226, 6234, 6235, and 6031 of the Code)

 

B. United States Tax Court

 

1. Filing period for interest abatement cases (sec. 421 of the Act and sec. 6404 of the Code)

2. Small tax case election for interest abatement cases (sec. 422 of the Act and secs. 6404 and 7463 of the Code)

3. Venue for appeal of spousal relief and collection cases (sec. 423 of the Act and sec. 7482 of the Code)

4. Suspension of running of period for filing petition of spousal relief and collection cases (sec. 424 of the Act and secs. 6015 and 6330 of the Code)

5. Application of Federal rules of evidence (sec. 425 of the Act and sec. 7453 of the Code)

6. Judicial conduct and disability procedures (sec. 431 of the Act and new sec. 7466 of the Code)

7. Administration, judicial conference, and fees (sec. 432 of the Act; Code sec. 7473 and new secs. 7470 and 7470A of the Code)

8. Clarification relating to the United States Tax Court (sec. 441 of the Act and sec. 7441 of the Code)

 

APPENDIX: ESTIMATED BUDGET EFFECTS OF TAX LEGISLATION ENACTED IN 2015
DOCUMENT ATTRIBUTES
Copy RID