Key Takeaways
- Tariffs
- Budget
- Regulation Repeal
- IRS
- Treasury
- Energy Credits
- Migrant Filings
- Millionaire’s Tax
- Tax Legislation
- Employee Firings
- In the Courts
- Hug Your Dog
Tariffs
Trump Hits Pause Button on Tariff Increases – Alexander Rifaat, Tax Notes ($):
In a Truth Social post April 9, Trump framed the pause as a reward for countries that “have not, at my strong suggestion, retaliated in any way, shape, or form against the United States” after he announced his reciprocal tariff plan the previous week.
Trump Halts Reciprocal Tariffs For 90 Days, Ups China Rates – Dylan Moroses, Law360 ($):
On his Truth Social platform, Trump said that more than 75 countries had approached U.S. government officials seeking negotiations to address tariff and non-tariff barriers, which prompted the president to issue the 90-day pause on the higher reciprocal rates. Those rates had kicked in at 12:01 a.m. on Wednesday.
Yet, the president said the 10% global baseline tariff on imports from all countries will continue to apply amid the pause on higher rates. The executive order revising the reciprocal tariffs was not immediately available.
EU Votes To Hike Levies in Response to US Metal Tariffs – Kevin Pinner, Law360 ($). “The European Union approved raising tariffs on U.S. goods in response to President Donald Trump's tariffs on steel and aluminum imposed in March, although the bloc has not yet made public the final list of products affected.”
Canada Retaliates With 25% Tariffs on US Cars And Parts – David Hansen, Law360 ($). “Canada began slapping 25% tariffs on American cars and parts Wednesday as retaliation against tariffs on Canadian products implemented by President Donald Trump, the country's Department of Finance announced.”
Budget
GOP Holdouts Force Delay in Vote on Trump Budget Plan – Richard Rubin & Olivia Beavers, Wall Street Journal:
A handful of hard-right conservatives resisted the pleas from Republican leaders and Trump, who had urged wavering House members to “close your eyes and get there.” The holdouts argued that the plan that came out of the Senate on Saturday didn’t lock in nearly enough spending cuts alongside extensions of expiring tax cuts.
House GOP holdouts threaten Trump’s ‘big, beautiful’ budget bill as Speaker Johnson postpones vote – Lisa Mascaro & Kevin Freking, Washington Post:
Speaker Mike Johnson almost dared the Republican hardliners to defy Trump and risk upending what the president calls the “big, beautiful bill,” which is central to his agenda of tax cuts, mass deportations and a smaller federal government. In the end, he had to hit pause, but vowed to try again Thursday.
House Republicans Pull Budget Resolution Vote – Cady Stanton, Tax Notes ($):
The budget resolution, which was set for a vote April 9, would allocate $1.5 trillion in net tax cuts and set a current-policy baseline for scoring the extension of expiring provisions from the Tax Cuts and Jobs Act. A vote on the measure had not yet been rescheduled at press time.
These Superfans of Trump Are Holding Out Against His Budget – Catie Edmondson, New York Times:
“I love the president,” he said this week as he walked through the Capitol.
But Mr. Burlison is also one of about a dozen hard-line conservative Republicans who have said they cannot back their party’s budget blueprint to unlock Mr. Trump’s spending and tax cuts, even as the president is imploring them to support it in a vote that could come as early as Wednesday.
House Delays Vote on Tax-Cut, Debt Limit Plan Amid Deficit Spat – Erik Wasson & Billy House, Bloomberg ($):
House leaders decided on Wednesday night to postpone a key vote to fast-track the package, after they determined they lacked the votes to clear a Senate-passed budget because of deep divisions in the party over whether to cut Medicaid health coverage, food assistance and other parts of the social safety net.
Regulation Repeal
White House Tells Agencies to Quickly Undo ‘Unlawful’ Rules – Lydia Beyoud, Bloomberg ($):
Federal agencies can use the “good cause” exception in US administrative law to overturn some rules without going through the typical lengthy rulemaking process, the Trump administration said in a memo on Wednesday. Officials were directed to focus those efforts on regulations they say go against recent Supreme Court decisions.
IRS
Top I.R.S. Officials Said to Resign After Deal to Give ICE Migrants’ Data – Andrew Duehren, New York Times:
The agreement between the I.R.S. and Immigration and Customs Enforcement, disclosed in a court filing on Monday, is a fundamental departure from decades of practice at the tax collector, which has sought to keep information submitted by undocumented immigrants confidential. Under the terms of the deal, a partially redacted version of which was submitted in the case, ICE officials can ask the I.R.S. for information about people who have been ordered to leave the United States or whom they are otherwise investigating. The two agencies have not yet shared any information, the filings said.
Acting IRS Chief to Depart, Extending Turmoil at Agency – Richard Rubin, Wall Street Journal:
The development comes a week before the individual income tax-filing deadline, in the IRS’s busiest time of year. The move happened right after an unusual data-sharing agreement between the IRS and immigration authorities became official, a step that required weeks of negotiations as agency attorneys tried to structure the deal to avoid violating taxpayer-privacy laws.
IRS Acting Chief to Stay on Through Mid-May, Treasury Says – Kat Lucero, Law360 ($):
Krause will serve as IRS acting commissioner until at least May 15 while President Donald Trump's nominee for commissioner, former Missouri Rep. Billy Long, awaits Senate confirmation, a Treasury spokesperson said in a statement.
IRS Workforce and Leadership Shakeup Repercussions: Explained – Erin Slowey & Erin Schilling, Bloomberg ($):
Acting IRS commissioner Melanie Krause—the third person to hold the job this year—decided to exit the agency as it’s come under pressure to more broadly share taxpayer data to further the Trump administration’s immigration efforts. This latest round of leadership turnover is just one part of a massive downsizing of the federal government, with the IRS bracing for cuts of up to a quarter of its workforce this year.
Krause’s Exit Brings ‘Unprecedented’ Turnover in IRS Leadership – Benjamin Valdez, Tax Notes ($):
Krause, who assumed the role of acting commissioner role on February 28, decided to participate in the deferred resignation program, which offers paid administrative leave through September 30. A Treasury spokesperson said in a statement that Krause would remain in her position “until at least May 15, where she will continue the hard work of re-structuring and modernizing the IRS.”
Treasury
Private Equity Ally Approaches Key Tax Post in Trump’s Treasury – Zach C. Cohen & Chris Cioffi, Bloomberg ($):
Kenneth Kies, Trump’s nominee to serve as assistant Treasury secretary for tax policy, lobbied on behalf of private equity firms, which are keen to preserve a lucrative tax benefit for venture capitalists, as well as hedge fund and other investment managers.
Energy Credits
House Republicans pitch chamber’s top tax writer on sparing clean energy tax credits – Kelsey Brugger & Nico Portuondo, Politico:
House Conservative Climate Caucus Chair Mariannette Miller-Meeks met earlier this week with House Ways and Means Chair Jason Smith (R-Mo.) to underscore the importance of leaving intact many of those tax credits created by the Democrats’ 2022 climate law, the Iowa Republican said in an interview.
Migrant Filings
IRS to Lose Billions in Revenue If Migrants Stop Filing Taxes – Augusta Saraiva, Bloomberg ($). “The Internal Revenue Service is projected to lose more than $313 billion in revenue in the coming decade as undocumented workers are poised to pay fewer taxes after the agency struck a deal to share data with US immigration authorities.”
Millionaire’s Tax
Americans for Tax Reform, Club for Growth Pan Millionaire’s Tax – Doug Sword, Tax Notes ($). “Two groups claim there aren’t enough Republican votes in the House to go back to a 39.6 percent top marginal rate or embrace the recent buzz about a millionaire’s tax being a tax package pay-for.”
Tax Legislation
Democrats Introduce Legislation to Expand Individual Tax Credits – Tyrah Burris, Tax Notes ($). “Democratic Senate taxwriters reintroduced legislation to permanently expand the child tax credit and the earned income tax credit for individuals without children.”
Employee Firings
Circuit Court Lifts Ban on Employee Firings – Kristen A. Parillo, Tax Notes ($):
In an April 9 order granting a Justice Department motion for a stay pending its appeal in Maryland v. Department of Agriculture, the circuit court concluded that the government is likely to succeed in showing the district court lacked jurisdiction over the plaintiffs’ claims.
Trump Freed to Fire Federal Workers as Court Pauses Hold – Courtney Rozen, Bloomberg ($):
The US Court of Appeals for the Fourth Circuit paused a district judge’s order directing federal agencies to rehire fired employees in “probationary” status that live and work in 19 states and Washington, D.C. The district court likely doesn’t have the jurisdiction to reverse the firings, appeals court judges Allison Jones Rushing, a Trump appointee, and Harvie Wilkinson, a Reagan appointee, said in their order.
In the Courts
Tax Court Restores $74M In Deductions for Met Donations – Anna Scott Farrell, Law360 ($). “A philanthropist can take nearly $74 million in charitable tax deductions for paintings he donated to the Metropolitan Museum of Art, even though the values were determined by an unqualified appraiser, the U.S. Tax Court ruled Wednesday in restoring a tax break denied by the IRS.”
Federal Court Spikes Damages Counterclaim in IRS Tax Levy Case – John Woolley, Bloomberg ($). “A federal court in Houston tossed $2 million in counterclaims brought by the trustee of a motor control business that the IRS alleged was used by its founders to avoid paying taxes.”
3rd Circ. Affirms NJ CPA's Tax Bill Over Rehashed Arguments – Jack McLoone, Law360 ($). “The U.S. Tax Court correctly determined that a New Jersey certified public accountant owed roughly $23,000 in federal income taxes, rejecting his previously deemed frivolous arguments that he was actually owed $30,000 in refunds, the Third Circuit said Wednesday.”
Custody Outweighs Usual Practice in Child Tax Credit Lawsuit – John Woolley, Bloomberg ($). “A noncustodial parent is unable to claim her child as a dependent because her ex-husband, who retained full-time custody, also claimed the child on his returns, the US Tax Court said Wednesday.”
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