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Tackling Tax Reform

Last week, the House Committee on Ways and Means took a major step in addressing comprehensive tax reform. Chairman Dave Camp (R-Michigan) established eleven fact-finding groups that have been tasked with reaching out to tax professionals and stakeholders (interested individuals and organizations, etc). Each lead by one Republican and Democrat committee member, these groups are scheduled to report their findings by April 15.

ADP reached out to counsel in DC for further details surrounding the process and to identify which working groups may be addressing the Work Opportunity Tax Credit (WOTC) programs. We’ve been advised that the following reflects a general overview of the direction the working groups will follow as well as the primary issues they will examine.

The groups are not expected to propose legislation. Each will have a Ways and Means professional tax staffer to help it organize its efforts, and the support of the Joint Committee on Taxation staff with respect to technical matters. The reports of the working groups will be compiled by the Joint Committee into a record as part of the tax reform legislative history.

The working groups are expected to focus their attention on three issues: (1) current law in their area of jurisdiction; (2) what proposals have been made to reform the area (including what was proposed under the Simpson/Bowles deficit reduction group set up by the White House); and (3) what are the concerns of stakeholders in the area, with respect to proposed changes. 

Charitable/Exempt organizations          David Reichert (R-WA)          John Lewis (D-GA)
Debt, Equity and Capital                      Kenny Marchant (R-TX)         Jim McDermott (D-WA)
Education and Family Benefits            Diane Black (R-TN)                Danny Davis (D-IL)
Energy Kevin Brady (R-TX)               Mike Thompson (D-CA)
Financial Services                                 Adrian Smith (R-NE)              John Larson (D-CT)
Income and Tax Distribution               Lynn Jenkins (R-KS)               Joe Crowley (D-NY)
International Devin Nunes (R-CA)               Earl Blumenauer (D-OR)
Manufacturing Jim Gerlach (R-PA)                 Linda Sanchez (D-CA)
Pensions/Retirement                             Pat Tiberi (R-OH)                    Ron Kind (D-WI)
Real Estate                                           Sam Johnson (R-TX)               Bill Pascrell (D-NJ)
Small Business/Pass Throughs             Vern Buchanan (R-FL)            Allyson Schwartz (D-PA)

Possible Groups for WOTC:

  •  Education and Family Benefits: This group has been tasked with welfare issues, a topic related to WOTC.
  • Income and Tax Distribution: As WOTC reduces taxation; it may fall here as part of a larger discussion of rates.
  • Manufacturing: To the extent that WOTC is used by manufacturers.
  • Small Business/Pass Throughs: The interests of small and medium sized businesses could land WOTC here. 

 Learn more about leveraging tax credits and incentives with help from ADP.



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