The House Ways and Means Tax Policy Subcommittee on May 12, 2016, held a hearing on Member proposals for improvements to the US tax system that included testimony about legislation addressing charity, research, energy, and student loan issues, among others. Chairman Charles Boustany (R-LA) said while focus was on improvements to the current tax code, the Committee is still committed to tax reform, which was the subject of two previous Member day hearings.

In an opening statement, Chairman Boustany discussed his bill (H.R. 4297) to provide protections for US companies impacted by the country-by-country reporting measures under the OECD BEPS Project. He cited testimony from a December hearing on the need for companies to be able to file country-by-country reports with the IRS for this year to ensure the confidentiality of the information that ultimately will be reported to foreign countries, and the competitive risks to American companies of being required to provide master file reporting under the OECD BEPS Project. Chairman Boustany said the Committee expressed the concerns to Robert Stack, Deputy Assistant Secretary for International Tax Affairs, and welcomed recent comments from Treasury indicating that they recognize the need for the IRS to accept country-by-country reports for 2016.

Rep. Pat Tiberi (R-OH) discussed his bill (H.R. 4770) to specify rules for applying the deduction for income from domestic production activities to contract manufacturing or production arrangements. He also discussed the Research & Experimentation Advances Competitiveness at Home (REACH) Act (H.R. 5187) that he introduced this week with Rep. John Larson (D-CT), which would increase the R&D Alternative Simplified Credit from 14% to 20%.

Rep. Larson discussed his Philanthropic Enterprise Act (H.R. 5007) that he sponsors with Rep. Dave Reichert (R-WA) that he said would make a technical fix in the tax code to ensure companies that devote all profits to charity through a foundation can continue doing so. Specifically, the bill would exempt private foundations from the tax on excess business holdings in the case of certain philanthropic enterprises which are independently supervised. Rep. Reichert also mentioned the bill.

Rep. George Holding (R-NC) discussed his Grow Philanthropy Act of 2016 (H.R. 4907) to exclude from the gross income of an individual who is at least 70 1/2 years of age up to $100,000 in distributions from an individual retirement plan to a donor-advised fund.

Rep. Peter Roskam (R-IL) and Rep. Kevin Cramer (R-ND) discussed H.R. 5171, to expand tax-free distributions from individual retirement accounts to include rollovers for charitable life-income plans for charitable purposes.

Rep. Reichert discussed his S Corporation Modernization Act (H.R. 2788); the Promotion and Expansion of Private Employee Ownership Act of 2015 (H.R. 2096) that would extend to all domestic corporations, including S corporations, provisions allowing deferral of tax on gain from the sale of employer securities to an S corporation-sponsored employee stock ownership plan (ESOP); and the need to update and reform alcohol excise taxes.

Rep. Kristi Noem (R-SD) called for updating tax incentives for alternative energy, including through a bill she is introducing with Rep. Bill Pascrell (D-NJ) to extend and reform the biodiesel tax credit and ensure that it is properly focused on American production.

Rep. Tom Reed (R-NY) discussed his bill with Rep. Mike Thompson (D-CA), the Technologies for Energy Security Act (H.R. 5167), to extend the credit for residential energy efficient property and the energy credit.

Rep. Pat Meehan (R-PA) discussed a bill (H.R. 2481) to allow a research tax credit for 35% of the in-house research expenses for taxpayers contracted to do research, including any research funded by any grant or contract or by another person or governmental entity. He also discussed a bill (H.R. 2179) to exempt from the definition of "passive activity," for purposes of the passive loss tax rules, any qualified research activity carried on by a high technology research small business pass-thru entity.

Rep. Rodney Davis (R-IL) discussed his Employer Participation in Student Loan Assistance Act (H.R. 3861) to extend the tax exclusion for employer-provided educational assistance to include payments of qualified education loans paid to either an employee or a lender. Rep. Scott Peters (D-CA) discussed the Student Loan Repayment Assistance Act (H.R. 1713), to exclude from the gross income of an employee amounts paid by an employer under a student loan payment assistance program.

Rep. Andy Barr (R-KY) discussed his Race Horse Cost Recovery Act (H.R. 3671), to make permanent three-year recovery period for race horses.

Rep. Erik Paulsen (R-MN) brought in a representative from Surly Brewing Company, a Minnesota-based craft brewery, to advocate for his Craft Beverage Modernization and Tax Reform Act of 2015 (H.R. 2903).

———————————————