Press Releases

WASHINGTON —Today, U.S. Sen. Mark R. Warner (D-VA), member of the Senate Finance Committee, released the following statement after the House voted in favor of a $78 billion tax package that would expand the Child Tax Credit and dramatically cut child poverty in the United States: 

“I am encouraged by today’s House passage of a bipartisan tax bill that would lift nearly half a million U.S. children out of poverty. As we saw during the pandemic, expanding the Child Tax Credit is a tried-and-true way to give struggling families a meaningful boost and help put food in the mouths of needy children. Especially now, with tax season around the corner, this legislation could provide near-immediate breathing room for millions of working families who live paycheck to paycheck – but only if the Senate acts quickly. As this bill makes its way to the Senate, I look forward to working with my colleagues on both sides of the aisle to deliver for American families.”

This legislation, as passed by the House, would benefit 16 million children in the U.S., lifting as many as 400,000 children above the poverty line in the first year alone and continuing to reduce poverty for the families of about 5 million additional children over time. 

Currently, the Child Tax Credit allows families up to $2,000 in tax credits per child. However, many families – especially poor families who need the program the most – do not make enough to reap the full tax deduction benefit. This bill would expand the Child Tax Credit by allowing families to reap the full credit as long as they continue to meet the minimum income threshold of $2,500 per year. It would also ensure that the Child Tax Credit can keep up with inflation. This legislation would help pick up where the nation left off at the end 2021, when a similar COVID-era expansion of the Child Tax Credit expired. 

###

  

WASHINGTON – U.S. Sens. Mark R. Warner (D-VA) and Todd Young (R-IN), today introduced the Motorsports Fairness and Permanency Act, bipartisan legislation that would make permanent a tax classification on depreciating assets for motorsports entertainment facilities. The legislation would allow venues to more effectively plan improvements and make safety updates, bringing additional jobs and positive economic impacts to surrounding communities.

“The Motorsports Fairness and Permanency Act is a simple fix to our tax code that will offer speedways the freedom to make long-term investments and upgrades to their facilities,” said Sen. Warner. “I’m proud to introduce legislation that will improve driver safety, enhance fan experience, and support jobs in our racing communities.”

“Motorsports are engrained in Indiana’s history and culture and play a major role in our state’s economy. This bill will make a simple fix to our tax code to give speedways the ability to make needed improvements, invest in safety, and enhance the spectator experience. I’m proud to support this bill on behalf of the Hoosier motorsports industry and race fans across Indiana,” said Sen. Young.

Since 2004, Congress has codified the definition of a motorsports entertainment complex in the tax code as a temporary provision, most recently extended under the 2020 omnibus and set to expire at the end of 2025. This provision allows racetrack complexes to operate under the understanding that all assets inside the facility depreciate as one over a seven-year period. However, the current uncertainty over whether the provision will be renewed has hindered the ability of track owners to make informed, long-term investment decisions for facility improvements in the future. Should the provision expire, roughly one third of all motorsports assets would be reclassified under the 39-year depreciation period and two thirds would fall under the 15-year period, putting racetracks at a serious disadvantage when compared to other sports and entertainment facilities.

Companion bipartisan legislation was introduced in the House of Representatives in April of this year. The Motorsports Fairness and Permanency Act is supported by the Automobile Competition Committee for the United States (ACCUS), the umbrella organization of auto racing sanctioning bodies in the United States.

“As future investments in capital projects are considered here at Martinsville Speedway, this important legislation provides much needed certainty not only for our facility, but motorsports facilities around the country,” said Clay Campbell, President, Martinsville Speedway.

“The Motorsports Fairness and Permanency Act will help protect jobs and investments in the motorsports industry. We appreciate Senator Warner and Senator Young’s leadership on this important issue,” said Lori Waran, President, Richmond Raceway.

"Motorsports entertainment complexes use the seven-year period afforded by the Motorsports Fairness and Permanency Act to reinvest in their facilities and organizations to create jobs, make safety improvements, and enrich the surrounding economies, most of which are in rural areas like VIRginia International Raceway (VIR) is to Halifax and Pittsylvania Counties,” said Connie Nyholm, Owner & CEO, Virginia International Raceway. “As a result of our investment and year-round operations, VIR has already attracted eighteen businesses to its campus and over 600,000 visitors annually through its gates." 

“Motorsports is a big economic engine in Indiana and the many racing facilities around the Hoosier state create and support thousands of jobs and millions of dollars of investment each year. The Indianapolis Motor Speedway is proud to be the world’s largest sporting venue with nearly 235,000 permanent seats around our 2.5 mile, 114 year old facility. Investing in our infrastructure and our customer experience is a constant emphasis and this legislation is beneficial to our planning and execution of projects and upgrades that our fans expect when the visit the Racing Capital of the World,” said Doug Boles, President, Indianapolis Motor Speedway.

“The Motorsports Fairness and Permanency Act impacts everyone at all levels of Indiana motorsports. And it treats everyone fairly. Regardless of the size of the racetrack, or the type of racing that fans enjoy there, we all need certainty to continue investing in improvements that help drive the local economy and improve the sport. Thanks to Senators Young and Warner for their leadership on this important Act,” said Reece O'Connor, President, Kokomo Speedway. 

A copy of the bill text is available here

###

WASHINGTON – U.S. Sens. Mark R. Warner and Tim Kaine joined Sens. Sherrod Brown (D-OH), Michael Bennet (D-CO), Cory Booker (D-NJ), Reverend Raphael Warnock (D-GA), Ron Wyden (D-OR), and Dick Durbin (D-IL) in introducing the Working Families Tax Relief Act, legislation that would cut taxes for low- and middle-income American workers and families by expanding the Child Tax Credit (CTC) and Earned Income Tax Credit (EITC). The American Rescue Plan, which Warner and Kaine helped pass, expanded these tax credits during the pandemic, but the expansion expired in December 2021; this bill would make the expansions permanent to continue to help families. 

The expanded CTC provided up to $300 in monthly tax refunds per qualifying child to help low- and middle-income families with children under 18 years old pay for basic necessities like food, housing and utility bills, education costs, and health care. It helped lift 2.1 million children out of poverty. In Virginia, the expanded CTC helped 1.7 million children— including 249,000 children living in poverty. The expanded EITC, which lowers taxes for low-income childless workers, provided up to $1,500 in annual tax relief to more than 400,000 workers without children in Virginia.  

“The expansion of the CTC and EITC helped many workers and families in Virginia pay for necessities like food, housing, and health care,” said the senators. “Permanently expanding these tax credits will offer more financial stability to families, keep children out of poverty, and put money back in the pockets of millions of hardworking American families and workers.”

 Specifically, the Working Families Tax Relief Act would:

  • Increase the annual CTC to $3,000 for low- and middle-income families with children ages 6-17 and $3,600 for low- and middle-income families with children ages 0-5, which is the rate it was in 2021. This CTC would be delivered in monthly payments as it was in 2021, providing a reliable source of financial stability.
  • Make the CTC “fully refundable” so that the lowest-income families can receive the credit. Under current law, many of these families are not able to benefit from the CTC.
  • Nearly triple the maximum value of the EITC for low-income workers without children.
  • Extend the EITC to workers starting at age 19 and eliminate the maximum age. The EITC can currently only be claimed if you are between 25-65 years old.

In addition to Warner, Kaine, Brown, Bennet, Booker, Warnock, Wyden, and Durbin, the legislation was cosponsored by Senators Tammy Baldwin (D-WI), Richard Blumenthal (D-CT), Maria Cantwell (D-WA), Ben Cardin (D-MD), Bob Casey (D-PA), Chris Coons (D-DE), Catherine Cortez Masto (D-NV), Tammy Duckworth (D-IL), Dianne Feinstein (D-CA), John Fetterman (D-PA), Kirsten Gillibrand (D-NY), Maggie Hassan (D-NH), Martin Heinrich (D-NM), Mazie Hirono (D-HI), Angus King (I-ME), Amy Klobuchar (D-MN), Ed Markey (D-MA), Jeff Merkley (D-OR), Chris Murphy (D-CT), Patty Murray (D-WA), Gary Peters (D-MI), Jack Reed (D-RI), Jacky Rosen (D-NV), Bernie Sanders (I-VT), Brian Schatz (D-HI), Chuck Schumer (D-NY), Jeanne Shaheen (D-NH), Tina Smith (D-MN), Debbie Stabenow (D-MI), Chris Van Hollen (D-MD), Elizabeth Warren (D-MA), Peter Welch (D-VT), and Sheldon Whitehouse (D-RI).

Warner and Kaine have long supported efforts to lower costs and improve tax fairness for Virginia workers and families. The senators helped pass the American Rescue Plan, which originally expanded the CTC and EITC. Expanding the CTC and EITC are priorities in Kaine’s Roadmap to Recovery, a legislative action plan to help America build on the progress made since the pandemic.

Full text of the bill is available here.

WASHINGTON – U.S. Sen. Mark R. Warner (D-VA) today pushed IRS Commissioner Danny Werfel to accelerate processing the backlog of Employee Retention Tax Credit (ERTC) claims. Commissioner Werfel asserted that the IRS is currently processing 20,000 ERTC claims per week, but after further questioning by Sen. Warner, committed to doubling the rate to 40,000 per week, with priority on the oldest claims.

The ERTC was created in response to COVID-19 to incentivize employers to keep their employees on payroll and off unemployment during the height of the pandemic. Virginia small businesses kept those promises to retain their workforce, but years later, due to IRS processing delays, many are still waiting to receive the tax credits they are due.

Sen. Warner has repeatedly raised this issue with the IRS, and today in a hearing of the Senate Finance Committee, he pressed Commissioner Werfel to commit to doubling the rate at which these credits are processed: 

Sen Warner asked, “I want to drill down on two issues… The first is, and this was the call we had in late March, the Employee Retention Tax Credit (ERTC). And one of the things we put in place during COVID, again, a bipartisan piece of legislation, which I think was well intended to make sure that employers kept people on during COVID rather than having to put them on unemployment. As I shared with you, you know, there are a number of businesses in Virginia, and I imagine this is probably the case in other states as well, where there's been a backlog. They can't get clarity. They're not getting these tax credits, which I think they did deserve. And since these are businesses that did, from a policy standpoint, what I think we all thought was the right thing by keeping folks employed during that period. Can you update us on the overall ERTC backlog and where we stand?”

Commissioner Werfel explained the factors that make processing ERTC claims difficult, then said, “The action is that now that filing season has ended, we now expect less of calls coming in, as most people have filed their taxes. And we can redeploy people off the phones and reset them so that we're managing paper. Now, prior to this move of moving people off the phones, we were resolving about 20,000 of these Employee Retention Credits a week and using overtime and any downtime where the phones aren't up, moving people to do it. Like every resource, it's an all-hands-on-deck situation post this filing season. Now that we can reset the staff, I think we can maybe double per week the amount of refund of credits that we're processing. So that's the action that we're taking. And in particular, I want to make sure and I've talked to the team about making sure that we go with the older ones first, like those that have been waiting the longest. So, you know, really focus on if it was received in 2022 or prior because they're still coming in, and under the law they can come in until 2025. So this is a filing that we're going to be dealing with for years, but I think we're going to make progress.”

Sen. Warner said, “That was a great answer, and I also took away the fact that you're going to double per week… How much of the backlog is being taken care of on a weekly basis at this point?”

Commissioner Werfel answered, “20,000 a week.”

Sen. Warner reinforced the answer and asked, “So we can look at 40,000 a week.”

Commissioner Werfel responded, “That's the hope.”

Sen. Warner, “You just said it on the record, so I'm going to be back to you!”

 

Separately, Sen. Warner also pushed Commissioner Werfel in today’s hearing to maximize awareness of the tax benefit created by his bipartisan Employer Participation in Repayment Act, which allows employers to contribute $5,250 tax-free towards their employees’ student loans. The credit has been extended until 2025 and is currently available to help employers retain talent while borrowers pay down their debt.

While questioning Commissioner Werfel, Sen. Warner said, “You know, Section 127 of the code has something that has again been bipartisan, supported for years, which basically, as you're aware, allows an employer to go ahead and send an employee back to school to get additional education. And that additional education up to $5,250 a year goes tax-free to the employee, great retention tool, great ability to get additional skills. One of the things and my friend John Thune and I put a bill in that got broad bipartisan support… that said… shouldn't we also allow those employees who have student debt to go ahead and qualify as well and… pay down that $5,250 a year, tax-free. We had it put in place for a year. It got extended through 2025. It seems like such a no brainer. The take up rate has been not great. What can we do to help further promote? And this is an area where, regardless how we feel about student debt, you know, everybody's kind of all in, and it’s a great retention tool.”

Sen. Warner has consistently pushed for faster processing of outstanding ERTC claims, including during a direct call to Commissioner Werfel in March, and has supported legislation to expand the program. He has also been a tireless advocate to improve IRS customer service and accelerate return times. Sen. Warner strongly supported the Inflation Reduction Act — legislation which provides funding to modernize IRS systems and improve customer service when paying taxes. This will help ensure the IRS has the resources it needs to process tax returns quickly, get rebates to taxpayers faster, and address challenges Virginians have when filing taxes. These investments have improved IRS response rates this tax season from answering two out of every 10 calls to answering nine out of every 10 calls.

Additionally, Sen. Warner has been pressing the IRS to address pandemic-related processing delays for several years. Sen. Warner first raised concerns over backlogs at the IRS in February 2021, as millions of Americans waited for delayed stimulus payments and processing of their tax returns. In January 2022, as the tax filing season opened, Sen. Warner again called on Treasury Secretary Janet Yellen and then-Commissioner Rettig to quickly address reports of unprocessed tax returns for the 2020 filing season. Later that month, Sen. Warner called on the IRS to provide relief for taxpayers amidst the backlog – a request he again reiterated in a bipartisan and bicameral March letter.

###

WASHINGTON – Today, U.S. Sens. Mark Warner (D-VA) and Jerry Moran (R-KS) along with U.S. Reps. Mike Kelly (R-PA-16) and Jimmy Panetta (D-CA-19) reintroduced the Broadband Grant Tax Treatment Act (BGTTA) legislation that would amend the Internal Revenue Code to ensure that funding for broadband deployment from the Infrastructure Investment and Jobs Act (IIJA) and the American Rescue Plan (ARP) will not be considered taxable income. This legislation was first introduced last Congress in both the Senate and the House of Representatives with bipartisan support. 

Grants awarded for the purposes of broadband deployment are currently factored into a company’s income and are subject to taxation. This bipartisan, bicameral legislation moves to exclude broadband deployment grants awarded through the IIJA, ARP, and Tribal Broadband Connectivity Fund from an organization’s income, ensuring the entirety of federal dollars awarded to companies for the purpose of deploying broadband around the country can be used wholly for that purpose, rather than making their way back to the government through taxes.

“We have made significant strides to ensure that access to high-speed internet is available to more Americans than ever,” said Sen. Warner, a member of the Finance Committee that oversees the nation’s tax code and a primary author of the broadband provisions in the IIJA and ARP. “But taxing broadband investment awards diminishes our efforts. This legislation ensures that individuals and businesses are able to reap the benefits of every dollar set aside for broadband expansion and deployment so that we can accomplish our goal of bringing reliable broadband to every corner of Virginia.”

“Reliable, high-speed internet is more crucial than ever for Kansans to run their businesses, access telehealth or pursue an education,” said Sen. Moran. “This commonsense legislation would make certain federal grants provided for broadband deployment are not counted as taxable income to maximize the impact and success of these resources.”

More than 800,000 Pennsylvanians, including 520,000 rural Pennsylvanians, lack quality broadband internet access,” said Rep. Kelly, Chairman of the Ways & Means Committee’s Subcommittee on Tax. “This bill will not only help to change to that, but it will also work to make that access more affordable. It also ensures federal grant dollars, especially those made available to local governments through pandemic relief funding, will give constituents the best return on their investment. Internet connectivity brings together all Americans; it strengthens small businesses and E-Commerce; and it expands educational opportunities for our children. This legislation allows for existing grant funding to be spent as effectively as possible to help all American families from farm communities in California to the shores of the Great Lakes in Pennsylvania.”

“Although we were able to pass legislation last Congress providing major investments in our nation’s broadband, many small businesses who get that federal funding, to construct networks and connect our homes, may face steep taxes,” said Rep. Panetta. “The Broadband Grant Tax Treatment Act would exempt those grants from federal taxation and ensure that the funding is allocated for universal broadband.  We will continue to work across the aisle in the House and across the U.S. Capitol with Senators to close the digital divide with investment and incentives that will bolster connectivity for every American.”

Joining Sens. Warner and Moran as co-sponsors are Sens. Tim Kaine (D-VA), Roger Wicker (R-MS), Rev. Raphael Warnock (D-GA), Kevin Cramer (R-ND), Joe Manchin (D-WV), Shelley Moore Capito (R-WV), Angus King (I-ME), James Risch (R-ID), Mark Kelly (D-AZ), Tommy Tuberville (R-AL), Kyrsten Sinema (I-AZ), Lisa Murkowski (R-AK), Bob Menendez (D-NJ), Michael Bennet (D-CO), and Tammy Baldwin (D-WI). Original co-sponsors in the House of Representatives are U.S. Reps. Terri Sewell (D-AL-07), Drew Ferguson (R-GA-03), Buddy Carter (R-GA-01), and Dan Kildee (D-MI-08).

“Access to high-speed internet is essential for telehealth, remote work, virtual learning, and more. The Bipartisan Infrastructure Law and American Rescue Plan made important investments to expand high-speed internet to more households in Virginia and across the country,” said Sen. Kaine. “Protecting these investments from being taxed will help ensure Virginians are getting the most out of these federal dollars.”

“The federal government should be lowering barriers to high speed internet access, not raising them,” said Sen. Wicker. “Taxing grants for broadband expansion only reduces their impact and penalizes providers who are working to close the digital divide.”

“High-speed broadband in North Dakota increases access to telehealth services, enhances learning pathways for students, and expands e-commerce opportunities for local businesses,” said Sen. Cramer. “We secured robust rural broadband grant funding in the infrastructure law, and this bill will help us maximize every dollar allocated.”

“Access to affordable, reliable broadband is vital to the success and growth of our communities across West Virginia,” said Sen. Manchin. “That’s why I helped author both the $65 billion broadband provisions in the Bipartisan Infrastructure Law and the $48 billion broadband provisions in the American Rescue Plan to provide historic funding to expand Internet access for all West Virginians, regardless of where they live across our great state. I’m proud to cosponsor this bipartisan, bicameral legislation to ensure the full amount of these critical grants are invested in expanding broadband access and I will continue fighting to promote the full participation of all West Virginians in today’s digital economy.”

“When Congress funded grant programs to help deploy broadband in underserved states like West Virginia, it was intended for all of those funds to be used for exactly that purpose – for broadband deployment,” said Sen. Capito. “Taxing federal broadband grants as gross income undermines our intent for these programs and would further delay efforts to close the digital divide in areas that need broadband connectivity the most. I’m proud to join my colleagues to reintroduce this legislation, and will continue to work toward solutions that help us close the digital divide in West Virginia and rural America.”

“Rural communities are the backbone of our nation, and we want to ensure that Americans living in these communities have access to high-speed internet,” said Sen. Tuberville. “Taxing broadband grants would undermine federal efforts to prioritize rural broadband expansion. I am proud to support this legislation so that those living in rural America have internet needed to run their businesses, access healthcare, and pursue educational opportunities.”

“Access to the internet is not a luxury, it is a fundamental necessity. However, too many families remain on the wrong side of the digital divide. Students, workers, families, innovators, and businesses of all sizes depend on reliable, affordable broadband more than ever, and that’s why we made historic investments in broadband deployment and digital equity during the last Congress,” said Sen. Menendez. “This commonsense bipartisan legislation will maximize the impact and success of these investments by ensuring these dollars support expanding access to broadband.”

“Coloradans rely on affordable, high-speed internet to stay in touch with family, discuss health concerns with their doctors, and enjoy the economic opportunities presented by the digital era,” said Sen. Bennet. “This bipartisan legislation will update our tax code to ensure that grants to connect our communities—including a program based off my BRIDGE Act that makes the single largest broadband investment in American history—are spent bridging the digital divide and building infrastructure for the 21st century.”

“As the COVID-19 has shown, access to reliable high-speed internet remains critical to the success of our communities,” said Rep. Sewell. “I am proud to support this rational bill ensuring that such resources can be utilized to the fullest extent without the tax code hindering growth in my district and across the state.”

“Broadband is essential 21st century infrastructure and every community – regardless of zip code – should have access to this critical tool and the growing opportunities it provides,” said Rep. Ferguson. “These federal grant funds must strictly be used for the intended purpose of building out broadband in rural and underserved communities, and not redirected back to the federal government. This important legislative fix ensures every federal dollar allocated is maximized and goes towards closing the digital divide.”

“The internet is no longer optional. From remote work to online learning, bill payments and more, we must ensure that federal dollars intended to help Georgians improve their digital access, particularly in rural areas, is not clawed back by the IRS,” said Rep. Carter.

“Reliable and affordable internet access is essential for Michiganders in today’s economy,” said Rep. Kildee. “The last Congress passed a new law, the Bipartisan Infrastructure Law, to expand high-speed broadband to every Michigan household. Our new bipartisan legislation would exempt broadband infrastructure grants from federal taxation for local governments and small businesses, to ensure we are maximizing this investment.”

As Senator, and during his tenure as the 69th Governor of Virginia, Sen. Warner has been a staunch advocate for expanded access to broadband. With more Virginia families relying on the internet for telework and telehealth following the COVID-19 crisis, Sen. Warner secured $65 billion in funding within the bipartisan infrastructure law to help deploy broadband, increase access, and decrease costs associated with connecting to the internet. Sen. Warner was also a key supporter of the American Rescue Plan, which delivered $17 billion in funding for broadband expansion across the country, including a $10 billion Capital Projects Fund that Sen. Warner authored and secured in the bill specifically for infrastructure projects to help rural and low- and moderate-income communities gain access to high-quality internet.

“CCA supports the Broadband Grant Tax Treatment Act, and I thank Senators Warner and Moran for reintroducing the legislation. Grant funding should be free from taxation to ensure all broadband grants awarded can be used to reach Americans with connectivity needs. Many rural and underserved communities will see great benefit from enhanced wireless broadband services, and every dollar granted should be used for that purpose,” said Competitive Carriers Association President & CEO Tim Donovan.

“We applaud Senators Warner and Moran's ongoing efforts to repeal the tax on broadband grants,” said USTelecom Senior Vice President of Government Affairs Brandon Heiner. “To achieve universal connectivity, Congress must eliminate this unnecessary tax to ensure that federal resources remain in the communities they seek to serve. If Congress is serious about achieving universal connectivity, they should ensure that 100 percent of broadband grants go toward that goal.”

“CTIA commends Senators Warner and Moran for reintroducing the Broadband Grant Tax Treatment Act. This bipartisan effort encourages investments that reinforce and accelerate broadband deployment needed to close the digital divide in unserved and underserved communities. We must ensure that all grant funds can be optimally spent as intended to help build out equitable digital access that connects Americans across the country,” said CTIA Senior Vice President for Government Affairs Kelly Cole.

“The once-in-a-lifetime resources in the Infrastructure Investment and Jobs Act and the American Rescue Plan have provided our members with an amazing opportunity to build networks of the future,” said INCOMPAS CEO Chip Pickering. “While this investment will help spur competition and radically upgrade our broadband infrastructure, there are still too many barriers to deployment. Onerous taxes should not be one of them. I am pleased to see Senator Warner and Senator Moran reintroduce this vital piece of legislation and wholeheartedly support their efforts to get this signed into law and deliver on our promise to truly have Internet for All.”

“WTA applauds the historic federal investment in rural broadband, but the tax code needs to be amended so that the more than 370 small, locally-based broadband providers we represent don’t have to divert money received from grant funding to build broadband networks to paying taxes on that funding,” said Derrick B. Owens, Senior Vice President for Government and Industry Affairs for WTA - Advocates for Rural Broadband. “We support the bipartisan efforts of Senators Warner, Moran, and others to streamline the tax code so as much broadband funding goes toward building networks, and connecting all Americans to broadband, as quickly as possible. We hope to see the Broadband Grant Tax Treatment Act passed by Congress.”

“We are grateful that Congress committed tens of billions of dollars to broadband deployment grants through recent bills seeking to help close the digital divide in our country. But taxing broadband grants – requiring recipients to pay back to the government a portion of what they receive from the government – will dramatically reduce the impact of these programs and likely leave the hardest-to-reach communities without essential connectivity for even longer,” said NTCA Chief Executive Officer Shirley Bloomfield. “It is critical that all broadband grant funds go toward their intended purpose of network deployment. NTCA is proud to support the Broadband Grant Tax Treatment Act, and on behalf of our members, I want to thank Senators Warner and Moran for reintroducing the bill. This legislation will maximize the impact of every dollar granted for broadband deployment and further the mission of getting every American connected.”

“Congress has made tremendous investments in recent years to ensure universal access to broadband for all Americans with the passage of the Infrastructure Investment and Jobs Act (IIJA) and the American Rescue Plan (ARP). However, a significant percentage of the funds needed to accomplish this goal could be returned to the Treasury in the form of taxes, ultimately undermining the deployment of needed broadband infrastructure. This would significantly restrain efforts by America’s frontline providers in the digital divide – the small ISPs working in rural, under-resourced and Tribal areas of our country – who need every dollar they can obtain to ensure the goal of universal broadband connectivity is properly met,” said Eric Slee, VP of Government Affairs, WISPA – Broadband Without Boundaries. “WISPA commends Senators Warner and Moran for introducing the Broadband Grant Tax Treatment Act, a common sense and necessary solution, which would eliminate the tax on broadband grants.  WISPA wholeheartedly supports their efforts in exempting IIJA and ARPA dollars from taxation and we are hopeful that similar treatment will eventually also apply to grants awarded through other federal programs.  We know this will make federal broadband deployment programs more effective and ubiquitous.”

"The Broadband Grant Tax Treatment Act is a common sense, bipartisan solution and a swift passage will ensure that the BEAD Program funding Congress appropriated via the Infrastructure Investment and Jobs Act will be used for its intended purpose," said Melissa Newman, vice president of government affairs at TIA. "Bridging the digital divide and delivering reliable, high-speed broadband is what the BEAD Program is designed to do, and taxing the grant funds would be counterproductive to the objective of this investment in America's infrastructure."

“I appreciate Senators Warner and Kaine introducing legislation to prevent the taxation of broadband grants,” said Bill Franklin, CEO, Scott County Telephone Cooperative. “One of the requirements for these grants is financial sustainability. This tax burden would make many rural unserved and underserved areas ineligible due to their inability to meet the financial sustainability requirement. I appreciate Senator Warner’s business knowledge and experience to recognize that fact. This legislation will ensure many rural Virginians and rural households across the US get access to reliable and robust broadband!”

Full text of legislation is available here

###

WASHINGTON – Today, U.S. Sen. Mark R. Warner (D-VA) applauded introduction of the Broadband Grant Tax Treatment Act in the House of Representatives by U.S. Reps. Jimmy Panetta (D-CA-20), Mike Kelly (R-PA-16), Terri Sewell (D-AL-7), and Drew Ferguson (R-GA-3), all members of the House Ways & Means Committee. Sen. Warner introduced the Senate version of the legislation in September. 

“Ensuring that the investments that Congress has made to ensure Americans have access to high-speed internet have the maximum possible impact is a bipartisan – and now bicameral – goal,” said Sen. Warner, a member of the Finance Committee that oversees the nation’s tax code and a primary author of the broadband provisions in the Infrastructure Investment and Jobs Act (IIJA) and American Rescue Plan (ARP). “I appreciate Representatives Panetta and Kelly introducing this legislation in the House of Representatives, and I look forward to working with them to get it over the finish line before the end of the year.”

Since introduction on September 29, 2022, six additional senators – Sens. Kevin Cramer (R-ND), Kyrsten Sinema (D-AZ), Angus King (I-ME), Tammy Baldwin (D-WI), Ted Cruz (R-TX), and Deb Fischer (R-NE) – have signed on to the legislation which would prevent critical broadband investments from counting as taxable income for grant recipients. They join original co-sponsors Sens. Jerry Moran (R-KS), Tim Kaine (D-VA), Roger Wicker (R-MS), Rev. Raphael Warnock (D-GA), and Shelley Moore Capito (R-WV),  

Already supported by NTCA – The Rural Broadband Association and WTA - Advocates for Rural Broadband, the legislation has also received several additional endorsements since introduction.

"We appreciate the leadership of Senators Warner and Moran for their efforts to eliminate the tax on broadband grants," said Brandon Heiner, USTelecom Senior Vice President of Government Affairs. "With an eye toward 100 percent connectivity, Congress made a historic investment in the broadband grant program in 2021. However, requiring grant recipients to return as much as 20 percent of those grants in the form of taxes jeopardizes our shared goal of universal connectivity. It is vital that Congress move to eliminate this tax, as America’s broadband providers carefully plan and prepare to allocate resources to connect as many Americans as possible."

“CTIA applauds Senators Warner and Moran for their work to protect investments that strengthen and expand broadband infrastructure," said CTIA Senior Vice President, Government Affairs, Kelly Cole. "Ensuring grants can be used for their fullest purpose to deploy broadband to unserved and underserved communities is critical to bringing the benefits of connectivity to all Americans.”

“I appreciate Senators Warner and Kaine introducing legislation to prevent the taxation of broadband grants," said Bill Franklin, CEO, Scott County Telephone Cooperative. "One of the requirements for these grants is financial sustainability. This tax burden would make many rural unserved and underserved areas ineligible due to their inability to meet the financial sustainability requirement. I appreciate Senator Warner’s business knowledge and experience to recognize that fact. This legislation will ensure many rural Virginians and rural households across the US get access to reliable and robust broadband!”

Full text of the bill is available here 

###

 

WASHINGTON – U.S. Sen. Mark Warner (D-VA), a member of the Congressional Coalition on Adoption Caucus, joined U.S. Sen. Bob Casey and 23 of his Senate colleagues in sponsoring the Adoption Tax Credit Refundability Act – legislation to make the existing federal tax credit for adoption expenses fully refundable and ensure that more families can benefit from this critical support. This legislation aims to support lower-income families that are adopting as well as address the number of children “aging out” of the foster care system.

“Every child deserves a loving and supportive home,” said Sen. Warner. “This legislation will enable more families to claim the adoption tax credit and pave the way for more children to be adopted into safe, stable, caring homes.”

The adoption tax credit was made permanent in the American Taxpayer Relief Act in January 2013. However, that law did not extend the refundability provisions that applied to the adoption tax credit in 2010 and 2011. The Adoption Tax Credit Refundability Act will restore the refundable portion of this critical support for families wishing to adopt.

According to data, Virginia ranks near the bottom of states – 49 out of 50 – when it comes to the percentage of children who “age out” of the foster care system. Virginia also has a higher percentage of older youth in foster care than the nation as a whole. This bill aims to help families seeking to adopt by removing some of the financial constraints families considering adoption face. 

Data indicate that a refundable adoption tax credit plays a significant role in lower-income families’ ability to adopt and support a child from foster care. According to the Department of Health and Human Services, one-third of all adopted children live in families with annual household income at or below 200 percent of the poverty level. Despite the common misperception that only wealthy families adopt, nearly 46 percent of families adopting from foster care are at or below 200 percent of the federal poverty level. Many of these families’ tax burdens are so low that they cannot benefit from the adoption tax credit at all unless it is refundable.

Full text of the bill is available here

###

WASHINGTON – Today, U.S. Sens. Mark Warner (D-VA) and Jerry Moran (R-KS), joined by Sens. Tim Kaine (D-VA), Roger Wicker (R-MS), Rev. Raphael Warnock (D-GA), and Shelley Moore Capito (R-WV), introduced the Broadband Grant Tax Treatment Act (BGTTA) legislation to amend the Internal Revenue Code to ensure that funding directed for the implementation of broadband from the Infrastructure Investment and Jobs Act (IIJA) and the American Rescue Plan (ARP) will not be considered taxable income.

Grants awarded to industry for the purposes of broadband deployment are currently factored into a company’s income and will soon be subjected to additional taxes due to scheduled changes to the corporate tax code that kick in beginning next year – unless Congress acts now to address the problem. This new bipartisan legislation moves to exclude broadband deployment grants awarded through the IIJA and ARP from an organization’s income, ensuring the entirety of federal dollars awarded to companies for the purpose of deploying broadband around the country can be used wholly for that purpose, rather than making their way back to the government through taxes.

“In order to fully reap the benefits of the Infrastructure Investment and Jobs Act and the American Rescue Plan, every dollar that was set aside to fund broadband expansion and deployment should be used for that purpose,” said Sen. Warner, a member of the Finance Committee that oversees the nation’s tax code and a primary author of the broadband provisions in the IIJA and ARP. “Taxing these broadband investments awards would be counter-productive, and could ultimately diminish efforts to give more Americans access to high-speed internet.” 

“Reliable, high-speed internet is more crucial than ever for Kansans to run their businesses, access telehealth or pursue an education,” said Sen. Moran. “This commonsense legislation would make certain federal grants provided for broadband deployment are not counted as taxable income to maximize the impact and success of these resources.”

“The pandemic underscored the need for everyone to have a high-speed internet connection—which is why Congress stepped up to help more households get connected through the American Rescue Plan and Bipartisan Infrastructure Law,” said Sen. Kaine. “Ensuring that those investments won’t be taxed will help speed our progress toward that goal and expand access to online learning tools, remote work opportunities, and telehealth services.”

“Many underserved communities will soon see the benefits of new federal investments in internet infrastructure, but new federal tax changes would reduce the grants’ reach,” said Sen. Wicker. “Broadband providers that are trying to close the digital divide should not be hit with tax penalties.”

“When Congress funded grant programs to help deploy broadband in underserved states like West Virginia, it was intended for all of those funds to be used for exactly that purpose – for broadband deployment,” said Sen. Capito. “Taxing federal broadband grants as gross income undermines our intent for these programs and would further delay efforts to close the digital divide in areas that need broadband connectivity the most. I’m proud to join my colleagues to introduce this legislation, and I will continue working toward our shared goal of helping bridge the digital divide in West Virginia and rural America.”

“The pandemic forced many of us to live even more of our lives online. Hardworking Georgia families need reliable internet access for their jobs, education, health care and so much more,” said Sen. Rev. Warnock. “I’m pleased to be a champion for broadband access and to be a part of this bipartisan coalition working to ensure rural regions in Georgia and across the nation have access to the resources they need to deploy broadband. The Broadband Grant Tax Treatment Act will help  connect Georgians so they can thrive in our bustling economy.”

As Senator, and during his tenure as the 69th Governor of Virginia, Sen. Warner has been a staunch advocate for expanded access to broadband. With more Virginia families relying on the internet for telework and telehealth following the COVID-19 crisis, Sen. Warner secured $65 billion in funding within the bipartisan infrastructure law to help deploy broadband, increase access, and decrease costs associated with connecting to the internet. Sen. Warner was also a key supporter of the American Rescue Plan, which delivered $17 billion in funding for broadband expansion across the country, including a $10 billion Capital Projects Fund that Sen. Warner authored and secured in the bill specifically for infrastructure projects to help rural and low- and moderate-income communities gain access to high-quality internet.

“We are grateful that Congress committed tens of billions of dollars to broadband deployment grants through recent bills seeking to help close the digital divide in our country. But taxing broadband grants – requiring recipients to pay back to the government a portion of what they receive from the government – will dramatically reduce the impact of these programs and likely leave the hardest-to-reach communities without essential connectivity for even longer,” said Chief Executive Officer of NTCA Shirley Bloomfield. “It is critical that all broadband grant funds go toward their intended purpose of network deployment. NTCA is proud to support the “Broadband Grant Tax Treatment Act,” and on behalf of our members, I want to thank Senators Warner and Moran for introducing the bill. This legislation will maximize the impact of every dollar granted for broadband deployment and further the mission of getting every American connected.”

“The federal government is making an enormous investment in rural broadband, but the effects of the tax code make it harder for the small, locally-based broadband providers we represent to maximize the amount of funding going to build out the network,” said Derrick B. Owens, Senior Vice President for Government and Industry Affairs for WTA - Advocates for Rural Broadband. We applaud the Senators for introducing this bipartisan legislation, which would streamline the tax code so that we’ll get as much broadband built as quickly as possible."

"We appreciate the leadership of Senators Warner and Moran for their efforts to eliminate the tax on broadband grants," said Brandon Heiner, USTelecom Senior Vice President of Government Affairs. "With an eye toward 100 percent connectivity, Congress made a historic investment in the broadband grant program in 2021. However, requiring grant recipients to return as much as 20 percent of those grants in the form of taxes jeopardizes our shared goal of universal connectivity. It is vital that Congress move to eliminate this tax, as America’s broadband providers carefully plan and prepare to allocate resources to connect as many Americans as possible."

“CTIA applauds Senators Warner and Moran for their work to protect investments that strengthen and expand broadband infrastructure," said CTIA Senior Vice President, Government Affairs, Kelly Cole. "Ensuring grants can be used for their fullest purpose to deploy broadband to unserved and underserved communities is critical to bringing the benefits of connectivity to all Americans.”

I appreciate Senators Warner and Kaine introducing legislation to prevent the taxation of broadband grants," said Bill Franklin, CEO, Scott County Telephone Cooperative. "One of the requirements for these grants is financial sustainability. This tax burden would make many rural unserved and underserved areas ineligible due to their inability to meet the financial sustainability requirement. I appreciate Senator Warner’s business knowledge and experience to recognize that fact. This legislation will ensure many rural Virginians and rural households across the US get access to reliable and robust broadband!”

Full text of the bill is available here

###

WASHINGTON – U.S. Sens. Mark R. Warner (D-VA) and Deb Fischer (R-Neb.) today introduced the Savings Security Act. The legislation would help the American people protect their savings from changes in inflation by increasing the public’s ability to utilize I Bonds, a type of savings bond created by the U.S. Treasury Department. Series I Savings Bonds were created so consumers could invest their hard-earned savings in something that isn’t hurt by inflation, earns a reasonable rate of return, and is backed by the full faith and credit of the federal government.

“We need to take an all-encompassing approach to help families facing high costs,” said Sen. Warner. “In tandem with our inflation-fighting efforts, and intervention from the Federal Reserve, this legislation would allow Americans to better shield their finances from the unpredictability of inflation and offer peace of mind during difficult economic times.”

“The American people are scrambling for ways to protect their earnings from rampant inflation. I Bonds are one option consumers should be able to leverage. Arbitrary purchasing caps on I Bonds, however, are shortchanging the public from better utilizing the program. Our bill would raise the annual purchasing cap to ensure working families can insulate a greater portion of their savings from the pain of sky-high inflation,” said Senator Fischer.

Currently, the Treasury Department caps annual purchases of I Bonds at $15,000 per person per year. The Savings Security Act would require the Treasury Secretary to raise the annual cap to $30,000 per person when the average six-month annual Consumer Price Index for all Urban Consumers (CPI-U) is above 3.5%. The new purchase limit only applies to families and individuals. Businesses and trusts would not be eligible for the increased cap.

Additional Background

Series I Bonds are a type of savings bond created by the U.S. Treasury. I Bonds earn monthly interest for 30 years, or until the saver cashes out of the bond.

I Bonds were created in 1998 during the Clinton Administration as a financial tool that families can utilize to protect their savings from the negative impacts of high inflation. 

Currently, the Treasury Department caps annual purchases of I Bonds at $15,000 per person. That includes $10,000 per person per year in electric I Bonds, and an additional $5,000 per person per year in paper-issued I Bonds that are purchased through a federal income tax return. The Savings Security Act would require the Treasury Secretary to raise the annual cap to $30,000 per person when the CPI-U is above 3.5%. The Savings Security Act does not change the $5,000 per person paper I bond cap.

I-Bonds can only be purchased via Treasurydirect.gov or through your federal income tax return.

The annual inflation rate in the United States is 8.3%

Fill text of the legislation is available here.

###

WASHINGTON – U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) joined a bipartisan group of House and Senate members in a letter to Internal Revenue Service (IRS) Commissioner Charles Rettig reiterating concerns regarding persistent customer services issues within the agency, and urging the IRS to eliminate the ongoing processing delays, improve customer service, extend the suspension of automated notices and collections, and continue making maximum use of overtime and surge teams.

“Since last year, numerous Members of Congress in the House and Senate have sent several letters regarding customer service issues, processing delays, and the outstanding backlog of returns,” wrote the bicameral group of lawmakers to IRS Commissioner Charles Rettig. “Yet, we are writing again to urge the IRS to extend the suspension of automated collections, continue the pause on automated notices, keep its surge teams in place until hiring challenges and processing backlogs are adequately addressed.”

The lawmakers continued, “[W]e believe that the IRS must take additional steps to improve customer service issues, decrease processing delays, and work-down the backlog of paper returns and correspondence by continuing the maximum use of overtime and surge teams, as well as the continued suspension of automated notices and collections—which have been critical in reducing pandemic-related tax return and correspondence backlogs.”

The letter came just before the signing of the Inflation Reduction Act — legislation Sens. Warner and Kaine helped pass in the Senate—which provides funding to modernize IRS systems and improve customer service when paying taxes. This will help ensure the IRS has the resources it needs to process tax returns quickly, get rebates to taxpayers faster, and address challenges Americans have when filing taxes.

Sen. Warner has been pressing the IRS to address pandemic-related processing delays for the last two years. Sen. Warner first raised concerns over backlogs at the IRS in February 2021, as millions of Americans waited for delayed stimulus payments and processing of their tax returns. In January 2022, as the tax filing season opened, Sen. Warner again called on Treasury Secretary Janet Yellen and Commissioner Rettig to quickly address reports of unprocessed tax returns for the 2020 filing season. Later that month, Sens. Warner and Kaine called on the IRS to provide relief for taxpayers amidst the backlog – a request they again reiterated in a bipartisan and bicameral March letter.  

In April of this year Sen. Warner questioned Commissioner Rettig during a Senate Finance Committee hearing about IRS-backlog related issues regarding Economic Injury Disaster Loans. Additionally, in a separate hearing of the Committee, Sen. Warner questioned IRS National Taxpayer Advocate Erin M. Collins about the backlogs and about the measures being taken to address the situation, and joined colleagues in another letter to Commissioner Rettig urging immediate action to reduce backlogs and improve customer service during the 2022 filing season.

A copy of the letter is available here and below.

Dear Commissioner Rettig:

Thank you for your continued work to eliminate the unprecedented backlog at the Internal Revenue Service (IRS). Since last year, numerous Members of Congress in the House and Senate have sent several letters regarding customer service issues, processing delays, and the outstanding backlog of returns. Several Members of Congress have urged you to provide penalty relief for taxpayers, have continually pressed the agency to pursue maximum overtime options for staff who are working on the backlog and on surge teams, and have asked the agency to deploy additional surge teams and other resources in an effective manner to reduce the backlog. Yet, we are writing again to urge the IRS to extend the suspension of automated collections, continue the pause on automated notices, keep its surge teams in place until hiring challenges and processing backlogs are adequately addressed.

In a Senate Finance Committee Hearing on April 7, 2022, you estimated that the IRS would return to a “healthy state” by the end of 2022 and that the IRS expected to hire 10,000 customer service representatives between this year and next year. Yet, according to the National Taxpayer Advocate (NTA), the paper return backlog has actually increased by 1.3 million from the same point as last year and that the IRS was only able to meet 12 percent of its hiring goals for processing center employees earlier this year. NTA also noted that the IRS has not met its 5,000 employee hiring goal for submission processing positions—falling short by 3,417 employees, and that while historically the IRS has paid refunds from paper returns in four to six weeks, refunds are currently taking six months or longer.

Accordingly, we believe that the IRS must take additional steps to improve customer service issues, decrease processing delays, and work-down the backlog of paper returns and correspondence by continuing the maximum use of overtime and surge teams, as well as the continued suspension of automated notices and collections—which have been critical in reducing pandemic-related tax return and correspondence backlogs. Additionally, the IRS must improve its recruitment and retention efforts to adequately address the backlog and increase levels of taxpayer service.

In order to gauge the extent of hiring and processing challenges still facing the Agency, we ask that you provide answers to the following questions no later than August 19, 2022:

Processing Backlogs:

  1. How do you plan to keep your promise to eliminate the backlog?
  2. What is a “healthy level” of unprocessed tax returns? How does this level align with average carryover levels, prior to the pandemic? Please provide the average carryover level over the ten years prior to FY2020, and the current carryover levels.
  3. How would you quantify a “manageable” carryover level? How does this compare to average carryover levels prior to the pandemic? Please provide a breakdown of average carryover levels for accounts management, submission processing, and returns in suspense.
  4. By how much do you estimate the carryover level will increase following the October 15, 2022 extension filing deadline?
  5. Do you believe your answers to questions 2-4 call your end-of-year estimate for a “healthy” IRS into question?
  6. For this filing season, what is the average refund delivery period? For comparison, please provide the average refund delivery period over the past ten years including the COVID-19 pandemic and excluding the COVID-19 pandemic.
  7. How long will the surge teams continue?  Will they continue through the end of the fiscal or calendar year, or beyond?
  8. What effect does the use of surge teams to process the backlog have on the IRS’ other activities, particularly answering phones?
  9. What steps is the Agency taking to speed up its processing of tax returns? Please specifically note whether the agency prioritizes the processing of returns with refunds.
  10. What is the status of IRS efforts to implement scanning technology, as recommended by the NTA?

Hiring Challenges:

  1. How many contractors is the IRS currently utilizing? How do contractors factor into the IRS’ stated hiring goals for submission processing and accounts management positions?

We appreciate your consideration of these requests and attention to these issues.

Sincerely,

### 

WASHINGTON — U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) released the following statement after President Biden signed the Inflation Reduction Act into law:

“We’re proud that this law will lower the price of prescription drugs, reduce the deficit, bring down energy bills and fight climate change. We’re also glad that it will help ensure that miners suffering from black lung and their families get the care and benefits they deserve. We will continue to look for ways to support the health and well-being of our communities, decrease inflation, and lower costs for Virginians.”

Below are some of the ways the Inflation Reduction Act will benefit Virginians:

Lower Prescription Drug Costs

  • The law allows Medicare to negotiate drug prices for seniors and people with disabilities—a provision Warner and Kaine have long fought to pass to lower prescription drug costs.
  • The law establishes a $2,000 cap on out-of-pocket costs for prescription drugs for seniors covered under Medicare Part D. In 2020, more than 36,000 Virginians with Medicare Part D spent more than $2,000 out-of-pocket on their prescription drugs.
  • The law expands the Low-Income Subsidy program, a program that currently helps cover prescription drug costs for over 11,000 low-income Virginians with Medicare.
  • The law provides free coverage for vaccines under Medicare Part D and improves access to vaccines under Medicaid and the Children’s Health Insurance Program (CHIP). In 2020, nearly 85,000 Virginians received a vaccine covered under Medicare Part D.

Affordable Health Care

  • During the pandemic, Congress enhanced subsidies under the Affordable Care Act (ACA) to help lower health care premiums for millions of Americans. The Inflation Reduction Act will extend these enhanced subsidies for three years through 2025 to help make Virginians’ health insurance more affordable. Over 300,000 Virginians have ACA coverage in 2022.
  • The Center for Medicare & Medicaid Services (CMS) estimated that Virginians with ACA insurance would have seen a $71 increase in their monthly premiums for the next coverage year if these subsidies weren’t extended.

Black Lung Benefits

  • The law permanently extends the Black Lung Disability Trust Fund excise tax at a higher rate, providing more certainty for miners, miner retirees, and their families who rely on the fund to access benefits. In Virginia, thousands of miners and their families have received benefits through the trust fund since it was established, including approximately 2,600 Virginians last year alone.

Clean Energy and Climate Provisions

  • The law will reduce carbon emissions by roughly 40 percent by 2030.
  • The law incentivizes investment in and production of renewable energy technologies like solar power and the Coastal Virginia Offshore Wind project.  The Inflation Reduction Act expands the 48C investment tax credit for clean energy manufacturers, with $4 billion reserved for use exclusively in coal communities. All clean energy tax credits include a bonus for meeting domestic manufacturing requirements related to steel, iron, or other manufactured components. The law also expands tax credits for residential clean energy and home efficiency improvements.
  • According to a recent analysis, the clean energy provisions are expected to create nearly 1 million jobs per year.
  • The law includes tax credits for clean medium and heavy duty trucks, such as those produced at the Volvo Trucks New River Valley Plant.
  • The law includes a $7,500 consumer credit for the purchase of new electric vehicles and incentivizes that vehicles are produced in North America.
  • The law includes $9.7 billion for financial assistance to rural electric cooperatives to improve resilience and affordability.
  • The law includes $2 billion for the USDA Rural Energy for America Program to provide competitive grants and loan guarantees to farmers, ranchers, and rural small businesses for renewable energy systems or energy efficiency improvements.
  • The law includes $20 billion to help farmers and ranchers adopt agriculture conservation practices that improve landscape resilience.

Tax Fairness

  • The law takes steps to make sure that the largest corporations and wealthiest Americans pay their fair share in taxes, without increasing taxes on small businesses or families making less than $400,000 a year.
  • The law also provides funding to modernize Internal Revenue Service (IRS) systems and improve customer service when paying taxes. This will help ensure the IRS has the resources it needs to process tax returns quickly, get rebates to taxpayers faster, and address challenges Americans have when filing taxes.

###

 

WASHINGTON – Today, U.S. Sens. Mark R. Warner (D-VA) and Chris Coons (D-DE) reintroduced legislation to give low- and moderate-income workers more access to lifelong learning opportunities. The Lifelong Learning and Training Account Act would establish a tax-preferred savings account with a generous government match to support workers looking to retrain or develop new skills throughout their careers.

In the coming years, more workers will be required to learn new skills throughout their careers. A National Academies of Sciences report focused on information technology and the U.S. workforce recently stressed the need to prepare individuals for the changing labor market. Due to automation, the McKinsey Global Institute estimates that up to a third of the U.S. workforce will need to learn new skills or find new work in new occupations by 2030. According to a Pew Research Center survey, 87 percent of workers believe training and developing new job skills throughout their work life is essential to succeed in the workplace. The Lifelong Learning and Training Account Act would give workers a tool to access that training by providing them with a portable, government-matched savings vehicle for lifelong learning.

“Access to lifelong learning and education is a critical tool that workers need to succeed in today’s economy. Therefore, it is essential for the federal government to support Americans’ ability to retrain and upskill throughout their career,” said Sen. Warner. “This is a no-brainer investment that would help workers continue to expand their skillsets and grow their earning potential. It would also help employers who need skilled workers to fill those jobs, particularly in a competitive labor market.”

“By strengthening access to skills training and fostering a culture of lifelong learning, we can support American workers while ensuring we have a workforce ready to fill the jobs of tomorrow,” said Sen. Coons. “That’s why I’m proud to partner with my colleague Senator Warner to invest in our future with this needed investment, and make available the growth and retraining we know will be vital in a competitive, global economy.”

“Small business owners often struggle to find skilled workers, which has become even more challenging during this competitive labor market,” said John Arensmeyer, Founder & CEO of Small Business Majority. “In fact, Small Business Majority's scientific opinion polling found more than one-third of small employers said it is difficult to find candidates with the right education, skills or training. Since small firms rarely have enough time to dedicate to extensive staff training or sufficient funds to pay for employee education, the Lifelong Learning and Training Account Act would be a huge boost to small businesses by offering them another way to invest in the development of their staff. This legislation would also help solo entrepreneurs invest in their own development and acquire skills without the aid of an employer.”

The Lifelong Learning and Training Account Act creates employee-owned Lifelong Learning and Training Account (LLTA) savings plans. Contributions to an LLTA by low- and moderate-income workers or their employers would be eligible for a dollar-for-dollar federal match of up to $1,000. Under this legislation, the federal matching funds would be directly deposited into the LLTA immediately after a contribution by the worker or employer. The worker would then get to choose how to use the LLTA funds, which could be applied towards any training that leads to a recognized post-secondary credential.

For workers that need to contribute to the cost of updating their job skills, this significant federal investment can make a huge difference in whether or not these workers seek additional training. If employers are willing to match employees’ savings, the returns can be even greater—a $500 contribution by a worker would create $2,000 in training opportunities (a $500 match by the employer, and then a $1,000 match from the federal government.) The accounts are portable from job to job, and always under workers’ control.

Contributions by workers and employers are after-tax dollars, but face no additional taxes on earnings if the LLTA funds are used for qualified training expenses. Eligibility is for workers age 25 to 60, with incomes of up to $82,000 per worker. States will manage the accounts. Accounts are designed to encourage the worker to use the funds to regularly update their skills, rather than build up large balances over many years. Restrictions are put in place to ensure that the government’s matching dollars go only to qualified training expenses.

The full text of the bill can be found here.

###

 

WASHINGTON - Today, U.S. Sen. Mark R. Warner (D-VA) joined Sens. Cory Booker (D-NJ) and Tim Scott (R-SC) and U.S. Representatives Ron Kind (D-WI) and Mike Kelly (R-PA) introduced a bipartisan, bicameral bill reforming Opportunity Zones, the tax incentive for individuals who reinvest unrealized capital gains into high-impact projects in underserved communities. Additionally, U.S. Chris Van Hollen (D-MD), and Todd Young (R-IN) and Representatives Terri Sewell (D-AL-07), Dan Kildee (D-MI-05), and Jackie Walorski (R-IN-02) co-sponsored the legislation, called the Opportunity Zones Transparency, Extension, and Improvement Act.

Booker and Scott originally introduced the Investing in Opportunity Act in April 2016. A provision based on the bill was included in the 2017 tax bill. As communities across the country have begun to see investments take hold, the lawmakers are proposing a series of improvements to the tax incentive.

“I am proud to co-sponsor this Opportunity Zone reform bill that will provide more transparency and reporting for these zones,” said Senator Warner. “I was an original leader on the bipartisan Investing in Opportunity Act, which led to the creation of Opportunity Zones, and I know this bill will make meaningful progress and substantially improve the policy.” 

“The Opportunity Zone incentive has the potential to unleash much-needed economic growth in high poverty communities across the country – communities that investors too often overlook. But without robust guardrails in place, the incentive could be undermined or abused by those who aren’t committed to uplifting rural and urban communities across the country,” said Senator Booker. “I am proud to introduce this legislation with Senator Scott to help restore the original promise of opportunity zones by steering private capital to reinvest in underserved communities that have been historically left behind and working to level the economic playing field.”

“The Opportunity Zone program represents the good that leaders can do for communities across the country when we work together toward common sense solutions,” said Senator Scott. “Independent reporting shows that investments in Opportunity Zones are making a huge impact across the country, with billions of dollars flowing into impoverished neighborhoods. I am glad to build on that success with this legislation to make the program stronger, so that we can ensure this incentive is benefitting the Americans who need it most.”

"Opportunity Zones are bringing capital to communities in rural and underserved areas and investing in our local economies," said Representative Kind. "In order to ensure this program is used as it was intended, we need strong transparency and accountability measures in place. I'm proud to help introduce this bipartisan, bicameral legislation to maximize the potential of Opportunity Zones, improve safeguards, and drive economic growth across the country."

“Opportunity Zones have brought new life to America’s Main Streets and communities that have not seen this type of investment in decades,” Representative Kelly said. “Nationally, one of the best-known Opportunity Zones is in my congressional district in Erie, Pennsylvania.  Due to great community partners and private investment, local leaders have been able to leverage the revitalization of downtown Erie.  Our new legislation will help ensure that Opportunity Zones can continue to revitalize communities like Erie for years and decades to come along with giving taxpayer’s the peace of mind that the government is working for them locally.”

“Gaps in Opportunity Zone programs have barred economically distressed areas from accessing the critical resources they need to create new local opportunities. This legislation will help close those gaps and ensure that Opportunity Zone investments lift up low-income communities – spurring further investments and ultimately benefiting Marylanders,” said Senator Van Hollen. “Maryland’s own Sparrows Point and Turner Station, alongside hundreds of recovering regions across the country, stand to see renewed economic vitality and more good-paying jobs as a result of this solution.” 

“The creation of the Opportunity Zones initiative in the 2017 tax reform law has succeeded in attracting capital and investments to historically distressed communities. They serve as a critical tool to create jobs, revitalize neighborhoods, and lift Hoosiers out of poverty, which is why I am proud to help introduce the Opportunity Zones Transparency, Extension, and Improvement Act. This bipartisan legislation will better optimize Opportunity Zone investment in neighborhoods and communities across Indiana while strengthening transparency and reporting metrics to improve on the initiative’s success,” said Senator Young.

This bipartisan legislation would improve Opportunity Zones by:

  • Reinstating and expanding the reporting requirements that were present in the Investing in Opportunity Act (IIOA), the original stand-alone legislation that created Opportunity Zones, but were stripped out in the 2017 Tax Cuts and Jobs Act due to procedural rules.
  • Ending Opportunity Zones that are not impoverished. While the vast majority of Opportunity Zones are truly impoverished areas, the legislation would sunset a small percentage of Opportunity Zone designations for tracts with a median family income at or above 130 percent of the national median family income. States would be able to designate a new tract in high-need communities for every tract sunsetted under this provision.
  • Creating pathways for smaller-dollar impact investments by allowing Qualified Opportunity Funds (QOFs) to be organized as a "fund of funds" that may invest in other QOFs, providing smaller communities and projects with the financing they need.
  • Providing operating support and technical assistance to high-poverty and underserved communities through a State and Community Dynamism Fund. Flexible grants will help states drive private and public capital to underserved businesses and communities.
  • Extending the tax incentive for two years in order to facilitate continued investment. It took the Treasury Department nearly two years to issue final regulations governing Opportunity Zones, during which time many investors and stakeholders stayed on the sidelines awaiting clear rules for the policy. Extending the policy by an equal amount of time will help investors and communities fully use the tool as Congress intended -- which is especially important now with the economy in recovery from the impacts of the COVID-19 pandemic.

The full text of the legislation can be viewed here

The one-pager of the legislation can be viewed here.

The section by section of the legislation can be viewed here.  

Quotes in support of the legislation can be viewed below:

John Lettieri, President and CEO, Economic Innovation Group:

“Supporting economic growth in low-income communities remains an urgent challenge as the country recovers from the severe disruption of the pandemic. One powerful way to do that is to strengthen the Opportunity Zones incentive, which has proven to be an effective tool for encouraging investment in struggling areas throughout the country,” said John Lettieri, President and CEO of the Economic Innovation Group. “The Opportunity Zones Transparency, Extension, and Improvement Act would enhance the policy on multiple fronts, including by enacting careful reporting and measurement standards, strengthening the incentive to draw in greater investment, creating new ways to attract funding for high-impact activities, and refining the map of designated communities to better align with the intent of the law. EIG applauds the bill’s sponsors for their thoughtful, bipartisan leadership in bringing this important legislation to fruition.” 

 

Jonathan Tower, Managing Partner, Arctaris Impact Investors:

“Arctaris Impact Investors has invested in the revitalization of under-invested communities for 13 years over 7 funds and, in our experience, the Opportunity Zone incentive is more efficient for delivering capital and social impact to low income census tracts than all the other federal and local economic development programs combined.  The proposed amendments will help attract more institutional-grade capital to OZ funds, and Arctaris looks forward to expanding its platform to support the growth of diverse businesses, community infrastructure, and real estate.  Further, Arctaris has long advocated for and adhered to higher standards for impact reporting than contained in the original legislation, and we welcome the greater transparency requirements in the proposed amendments.”

 

Martin Muoto, CEO, SoLa Impact:

“This bipartisan legislation to improve the Opportunity Zones policy will drive investors to focus more on social impact in communities like South Los Angeles,” said Martin Muoto, CEO of SoLa Impact. “The OZ legislation has enabled SoLa to leverage private capital to build over 1,500 affordable and workforce housing units and house hundreds of formerly homeless residents.”

 

Alex Flachsbart, Founder and CEO, Opportunity Alabama:

“As presented, The Opportunity Zones Transparency, Extension, and Improvement Act will be the biggest step forward for Opportunity Zones in the program’s history. Providing a longer deferral window and allowing the feeder fund concept will substantially improve the flow of capital into the program - and, thanks to inclusion of additional reporting requirements, we can finally get real data on where those funds will flow. Most important, though, is the inclusion of the State and Community Dynamism Fund, a tool that - if properly implemented - could make Opportunity Zones the most effective incentive in the tax code at driving impactful, ground-up community development work."  

 

John Persinger, CEO, Erie Downtown Development Corporation:

“Opportunity Zones are helping to fuel a $100 million revitalization of downtown Erie, Pennsylvania, which is home to one of the poorest zip codes in America,” said John Persinger, CEO of the Erie Downtown Development Corporation. “Strengthening the oversight provisions and generally improving the legislation will ensure that Opportunity Zones continue to help those communities with the greatest economic and social needs, communities like Erie.”

 

Rick Wade, Senior Vice President, U.S. Chamber of Commerce:

“The Opportunity Zone program is a positive, compelling example of government and the private sector working together to solve our nation's challenges. Investments made possible through the Opportunity Zone program will help underserved communities struggling to bounce back from pandemic-induced economic hardships. The U.S. Chamber of Commerce is proud to support this bipartisan legislation that ensures Opportunity Zone financing reaches the areas of our country that need it the most and expands the reach of a public-private partnership on track to decrease the poverty rate by 11 percent,” said Rick Wade, Senior Vice President at the U.S. Chamber of Commerce

 

Stephanie Copeland, Partner, Four Points Funding:

"The changes addressed in this bill not only practically strengthens the Opportunity Zone program, but also continues to align investors to the intent of the incentive. We are thrilled to see the thoughtful progress."

 

Katie Kramer, Vice President, Council of Development Finance Agencies:

“The Council of Development Finance Agencies is grateful to Congress for their efforts to introduce important reforms to Opportunity Zones. The State and Community Dynamism Fund is critically needed at the local levels to fully deploy comprehensive OZ strategies in disinvested communities. We stand ready to support the implementation of the Opportunity Zones Transparency, Extension, and Improvement Act.”

 

Ross Baird, CEO and Founder, Blueprint Local:

“As active Opportunity Zone investors, we are excited to see this legislation that can ultimately drive much more impact in distressed communities. It is very positive to see the reporting requirements, which will bring transparency to this catalytic program and drive more impact in communities, as well as the fund of funds provision, which will help many more investors participate in the program and help the country’s most impactful projects find the capital they need.”

 

Ben Seigel, Opportunity Zones & Impact Investment Coordinator, Baltimore Development Corporation:

"From Day 1, the Baltimore Development Corporation embraced Opportunity Zones as a tool for attracting impact capital to underserved neighborhoods and projects in our city. We were one of the first cities in the country to hire an Opportunity Zones Coordinator to match investors with projects, as well as track and monitor investments and their impact. While we have been pleased with the results to date, we know that Opportunity Zones can do a lot more to drive inclusive economic growth in our city. This new legislation would significantly increase the promise and potential of Opportunity Zones in a place like Baltimore City by extending the incentive period, requiring impact reporting, and investing additional resources into OZ projects and local capacity building in underserved communities."

 

Jeremy Keele, Managing Partner, Catalyst Opportunity Funds:

"We're really supportive of this new legislation to improve key elements of the Opportunity Zone policy. As impact-focused investors active in the OZ strategy, we believe the proposed changes are likely to improve transparency and accountability program-wide, and more directly target capital and other resources into the low-income communities around this country that stand to benefit most from OZ investment."  

 

# # #

WASHINGTON – U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) joined Sens. Bob Menedez (D-NJ), Bill Cassidy (R-LA), Rep. Abigail Spanberger (D-VA-07) and a bipartisan, bicameral group of colleagues in a letter to Internal Revenue Service (IRS) Commissioner Charles Rettig urging the IRS to provide much needed relief as the agency struggles to address customer service and processing issues. The IRS’s lack of action is causing unnecessary confusion, as the current tax filing season is underway.

“We remain concerned that the IRS does not have a comprehensive plan to remedy the numerous problems affecting taxpayers, despite the fact that this filing season is already well underway,” the lawmakers wrote. “For example, there is continued confusion about which notices may be unilaterally suspended by the IRS, beyond the notices the IRS has already suspended, among other issues.”

In the letter, the lawmakers requested the IRS specifically address which notices are statutorily required to be issued within a specific time, and explain why there are still certain notices that have not yet been suspended.

This letter is supported by the Association of International Certified Professional Accountants (AICPA), Padgett Business Services, National Association of Enrolled Agents (NAEA), National Association of Tax Professionals (NATP), National Society of Accountants (NSA), National Conference of CPA Practitioners (NCCPAP), National Association of Black Accountants, Inc. (NABA), Latino Tax Pro, Diverse Organization of Firms Advocacy Committee , National Society of Black Certified Public Accountants (NSBCPA), Prosperity Now, and National Society of Tax Professionals (NSTP).

Sen. Warner first raised concerns over the IRS backlog in January, calling on Treasury Secretary Janet Yellen and Commissioner Rettig to quickly address reports of unprocessed tax returns for the 2020 filing season. Later that month, Sens. Warner and Kaine called on the IRS to provide relief for taxpayers amidst the backlog. Last month, Sen. Warner continued his push to reduce delays, joining colleagues in another letter to Commissioner Rettig urging for immediate action to be taken to reduce backlogs and improve customer service during the 2022 filing season. Additionally, in a February Senate Finance Committee hearing, Sen. Warner questioned IRS National Taxpayer Advocate Erin M. Collins about the IRS backlogs and about the measures being taken to address the situation.

In addition to Sens. Warner, Kaine, Menendez and Cassidy, the Senate letter was signed by Sens. John Barrasso (R-WY), Michael Bennet (D-CO), Marsha Blackburn (R-TN), Richard Blumenthal (D-CT), Cory Booker (D-NJ), John Boozman (R-AR), Mike Braun (R-IN), Richard Burr (R-NC), Shelly Moore Capito (R-WV), Ben Cardin (D-MD), Tom Carper (D-DE), Susan Collins (R-ME), Chris Coons (D-DE), Catherine Cortez Masto (D-NV), Mike Crapo (R-ID), Steve Daines (R-MT), Tammy Duckworth (D-IL), Joni Ernst (R-IA), Chuck Grassley (R-IA), Mark Kelly (D-AZ), Angus King (I-ME), Amy Klobuchar (D-MN), James Lankford (R-OK), Patrick Leahy (D-VT), Cynthia Lummis (R-WY), Joe Manchin (D-WV), Lisa Murkowski (R-AK), Chris Murphy (D-CT), Rob Portman (R-OH), Jacky Rosen (D-NV), Tim Scott (R-SC), Tina Smith (D-MN), Debbie Stabenow (D-MI), John Thune (R-SD), Pat Toomey (R-PA), Chris Van Hollen (D-MD), Raphael Warnock (D-GA), and Todd Young (R-IN).

A copy of the Senate version of the letter is available here and below.

Dear Commissioner Rettig,

We appreciate the Internal Revenue Service (IRS)’s ongoing efforts to eliminate the unprecedented backlog at the IRS. We remain concerned that the IRS does not have a comprehensive plan to remedy the numerous problems affecting taxpayers, despite the fact that this filing season is already well underway. For example, there is continued confusion about which notices may be unilaterally suspended by the IRS, beyond the notices the IRS h as already suspended, among other issues.

Given that the IRS has not provided us with any additional information since your last correspondence dated February 8, 2022, we ask for responses to the following questions, no later than the close of business on Monday, March 14, 2022:

1. Which remaining unsuspended notices does the IRS have the authority to suspend? Please explain why the IRS has left these remaining notices unsuspended.
 
2. Is the IRS in the process of working to suspend additional notices? If so, when will that work be completed?
 

3. Which notices are statutorily required to be issued within a specific time? Would the IRS suspend these statutory notices if the IRS had the legal authority to do so?
 
4. Explain why the IRS has not suspended notice CP2000, Notice of Underreported Income? 
 
5. Notwithstanding the publication of Notice 2021-39, widespread controversy surrounding Schedules K-2 and K-3 remains, including recent additional instructions, the inability to electronically file, and lingering uncertainty surrounding many requirements. As such, is the IRS contemplating relief, such as delaying implementation to 2023?
 
6. In early February, the IRS advised Congress that it was considering a systemic process to identify pending penalty abatement requests, and likewise evaluating penalty relief options. Has the IRS determined if it can provide penalty relief for taxpayers as previously offered by the IRS for the 2020 and 2021 tax year? If not, why not?

Thank you for your continued attention to this important matter.

Sincerely,

###

WASHINGTON – With millions of Americans struggling to get answers from the Internal Revenue Service (IRS), U.S. Sen. Mark R. Warner (D-VA) today continued his push to reduce delays and ensure that Virginians are able to get through the 2022 filing season as smoothly as possible.

In a joint letter to IRS Commissioner Charles Rettig, Sen. Warner and a number of his Senate colleagues today urged the IRS to take immediate action to reduce its massive backlog and improve its customer service during the 2022 tax filing season. Specifically, the lawmakers called on the IRS to consider pursuing maximum overtime options for its staff, expanding its surge teams to address processing and correspondence delays, and seeking fast ways to train additional employees and volunteers.

“As the IRS works to eliminate the current backlog of returns and correspondence, we request you to pursue additional actions to maximize the IRS’ current workforce to address the backlog in order to reduce disruptions this filing season,” wrote the lawmakers to IRS Commissioner Rettig.

“We continue to hear from constituents who are still waiting for their 2020 tax returns, have received confusing notices about overdue payments they already paid, and cannot reach anyone at the IRS for assistance. Many of these problems stem from the millions of unprocessed correspondence items from 2021,” the lawmakers added. “We understand the long-term solution to ensure the IRS can manage its workload and provide timely and high-quality service to taxpayers is additional resources to hire and train employees across several departments and modernize technologies. However, those investments will take time, and taxpayers require more immediate relief, especially with the 2022 filing season already underway.”

Additionally, in a Senate Finance Committee hearing today, Sen. Warner questioned IRS National Taxpayer Advocate Erin M. Collins about the IRS backlogs and about the measures being taken to address the situation.

Specifically, Sen. Warner touched on the possibility of extending the tax filing deadline, asking whether an extension would be beneficial in light of the ongoing backlogs. He also asked whether the IRS is setting appropriate expectations and whether the IRS can and should do more right now to better communicate issues to taxpayers.

A copy of the letter to IRS Commissioner Charles Rettig is available here. High-quality audio and video of the hearing exchange is available here or above.

###

WASHINGTON – U.S. Sens. Mark R. Warner and Tim Kaine joined U.S. Sens. Bob Menendez (D-NJ), Bill Cassidy (R-LA), and 212 colleagues in a bipartisan, bicameral letter calling on the Treasury Department and the Internal Revenue Service (IRS) to provide penalty relief for taxpayers and help reduce processing backlogs at the IRS, after hearing from Virginians who are still waiting on their refunds from the 2021 filing season. Taxpayers may qualify for relief from penalties if they made an effort to comply with legal requirements but weren’t able to meet their tax obligations due to circumstances beyond their control, including processing backlogs. The lawmakers noted the delayed processing of amended returns has been particularly devastating to small businesses whose applications for emergency loans from the Small Business Administration (SBA) have been caught in limbo nearly two years after the pandemic began.

“While the COVID-19 pandemic has strained every federal agency, the impact on the IRS has been particularly severe,” wrote the lawmakers. “As of December 23, 2021, the IRS continued to have a backlog of 6 million Forms 1040 (Individual Income Tax Returns) and 2.3 million amended individual tax returns. In addition, the IRS has 2 million Forms 941 (Employer Quarterly Tax Returns) that must be processed before the nearly 500,000 amended Forms 941 can be processed.”

“Recognizing the extraordinary challenges of the COVID-19 pandemic, in addition to the IRS operating with antiquated technology and a constrained budget, we find the current situation alarming. We stand ready to support the IRS and look forward to hearing how we can help you address any obstacles facing the agency,” the lawmakers added. “However, we respectfully request the IRS consider the following measures to bring immediate relief to taxpayers, and reduce the backlog, during this tax filing season. ...While we recognize no single action will alleviate issues that have resulted from difficulties at the IRS spanning administrations of both political parties, these steps would provide our constituents with greater certainty as we enter this year’s filing season.”

Last week, Senator Warner raised concerns with the IRS after hearing from Virginians who are still waiting on their refunds from the 2020 filing season, following a February 2021 letter addressing the same issue of persistent processing delays at the IRS. As members of the Senate Budget Committee, Senators Warner and Kaine are currently pushing for legislation to substantially increase funding for the IRS and help the agency improve operations in the long term.

In addition to Sens. Warner, Kaine, Menendez, and Cassidy, the letter was signed by Sens. Cory Booker (D-NJ), Michael Bennet (D-CO), Richard Blumenthal (D-CT), Sherrod Brown (D-OH), Ben Cardin (D-MD), Tom Carper (D-DE), Chris Coons (D-DE), Catherine Cortez Masto (D-NV), Tammy Duckworth (D-IL), Kirsten Gillibrand (D-NY), Amy Klobuchar (D-MN), Patrick Leahy (D-VT), Cynthia Lummis (R-WY), Joe Manchin (D-WV), Jeff Merkley (D-OR), Chris Murphy (D-CT), Jacky Rosen (D-NV), Debbie Stabenow (D-MI), Chris Van Hollen (D-MD), Raphael Warnock (D-GA), and Ron Wyden (D-OR).

This effort is supported by the Tax Professionals United for Taxpayer Relief Coalition, which includes the American Institute of CPAs (AICPA), National Association of Enrolled Agents (NAEA), Padgett Business Services, H&R Block, Latino Tax Professional Association, National Association of Tax Professionals (NATP), National Society of Tax Professionals (NSTP), National Society of Accountants (NSA), National Society of Black Certified Public Accountants (NSBCPA), National Conference of CPA Practitioners (NCCPAP), Diverse Organization of Firms Advocacy Committee, National Association of Black Accountants (NABA), and Prosperity Now.

Full text of the letter can be found here and below. 

Dear Secretary Yellen and Commissioner Rettig,

As the 2022 tax filing season fast approaches, we are concerned about the unprecedented challenges facing the Internal Revenue Service (IRS) and the ongoing impact on our constituents. While the COVID-19 pandemic has strained every federal agency, the impact on the IRS has been particularly severe. As of December 23, 2021, the IRS continued to have a backlog of 6 million Forms 1040 (Individual Income Tax Returns) and 2.3 million amended individual tax returns.  In addition, the IRS has 2 million Forms 941 (Employer Quarterly Tax Returns) that must be processed before the nearly 500,000 amended Forms 941 can be processed.

In many cases, the delayed processing of amended returns has been devastating to small businesses in our communities whose applications for emergency loans from the Small Business Administration have been caught in limbo nearly two years after the COVID-19 pandemic began. The situation has deteriorated to a point that the Taxpayer Advocate Service (TAS) will no longer accept cases solely involving the processing of amended returns] This has made it impossible for frustrated taxpayers to find any help.  When our constituents cannot get assistance from the IRS and TAS, they contact us, and we have our hands tied at this point as well. 

Recognizing the extraordinary challenges of the COVID-19 pandemic, in addition to the IRS operating with antiquated technology and a constrained budget, we find the current situation alarming. We stand ready to support the IRS and look forward to hearing how we can help you address any obstacles facing the agency. However, we respectfully request the IRS consider the following measures to bring immediate relief to taxpayers, and reduce the backlog, during this tax filing season:

  • Halt automated collections from now until at least 90 days after April 18, 2022;
  • Delay the collection process for filers until any active and pending penalty abatement requests have been processed;
  • Streamline the reasonable cause penalty abatement process for taxpayers impacted by the COVID-19 pandemic without the need for written correspondence; 
  • Provide targeted tax penalty relief for taxpayers who paid at least 70 percent of the tax due for the 2020 and 2021 tax year; and
  • Expedite processing of amended returns and provide TAS and congressional caseworkers with timely responses.

While we recognize no single action will alleviate issues that have resulted from difficulties at the IRS spanning administrations of both political parties, these steps would provide our constituents with greater certainty as we enter this year’s filing season. Thank you for your attention to this urgent matter and the dedication of the IRS and Treasury personnel to improving the filing process in these extraordinary times.

Sincerely,

 

###

WASHINGTON – U.S. Sen. Mark R. Warner today joined a bipartisan, bicameral group of colleagues in calling on the U.S. Department of the Treasury and the Internal Revenue Service (IRS) to provide penalty relief for taxpayers amid extensive, ongoing processing backlogs at the IRS. The House version of the letter was led by U.S. Representatives Linda Sánchez (D-Calif.-38), Darin LaHood (R-Ill.-18), Richard Neal (D-Mass.-01), Vern Buchanan (R-Fla.-16), Mike Thompson (D-Calif.-05), Tom Rice (R-S.C.-07), Bill Pascrell (D-N.J.-09), Drew Ferguson (R-Ga.-03), Judy Chu (D-Calif.-27), and Ron Estes (R-Kan.-04).

“While the COVID-19 pandemic has strained every federal agency, the impact on the IRS has been particularly severe,” wrote the group of lawmakers to Treasury Secretary Janet Yellen and IRS Commissioner Charles Rettig. “As of December 23, 2021, the IRS continued to have a backlog of 6 million Forms 1040 (Individual Income Tax Returns) and 2.3 million amended individual tax returns. In addition, the IRS has 2 million Forms 941 (Employer Quarterly Tax Returns) that must be processed before the nearly 500,000 amended Forms 941 can be processed.”

The lawmakers noted the delayed processing of amended returns has been particularly devastating to small businesses whose applications for emergency loans from the Small Business Administration have been caught in limbo nearly two years after the COVID-19 pandemic began.

“Recognizing the extraordinary challenges of the COVID-19 pandemic, in addition to the IRS operating with antiquated technology and a constrained budget, we find the current situation alarming. We stand ready to support the IRS and look forward to hearing how we can help you address any obstacles facing the agency. However, we respectfully request the IRS consider the following measures to bring immediate relief to taxpayers, and reduce the backlog, during this tax filing season,” the lawmakers added. “...While we recognize no single action will alleviate issues that have resulted from difficulties at the IRS spanning administrations of both political parties, these steps would provide our constituents with greater certainty as we enter this year’s filing season.”

This effort is supported by the Tax Professionals United for Taxpayer Relief Coalition, which includes the American Institute of CPAs (AICPA), National Association of Enrolled Agents (NAEA), Padgett Business Services, H&R Block, Latino Tax Professional Association, National Association of Tax Professionals (NATP), National Society of Tax Professionals (NSTP), National Society of Accountants (NSA), National Society of Black Certified Public Accountants (NSBCPA), National Conference of CPA Practitioners (NCCPAP), Diverse Organization of Firms Advocacy Committee, National Association of Black Accountants (NABA), and Prosperity Now.

“The Tax Professionals United for Taxpayer Relief Coalition is grateful to Senators Menendez and Cassidy and the 214 Members of Congress for their leadership towards making this tax filing season a little easier for taxpayers and practitioners. The Coalition represents millions of taxpayers from diverse backgrounds, including those representing Latinos, African Americans, small businesses and low-income taxpayers – Senators Menendez and Cassidy and their colleagues are fighting for these taxpayers. Together, we aim to reduce contact with an agency under strain. We ask that the IRS heed the unified voice of our stakeholder coalition and Members of Congress to grant taxpayers relief now.”  

Full text of the letter is available here and below. 

Dear Secretary Yellen and Commissioner Rettig,

As the 2022 tax filing season fast approaches, we are concerned about the unprecedented challenges facing the Internal Revenue Service (IRS) and the ongoing impact on our constituents. While the COVID-19 pandemic has strained every federal agency, the impact on the IRS has been particularly severe. As of December 23, 2021, the IRS continued to have a backlog of 6 million Forms 1040 (Individual Income Tax Returns) and 2.3 million amended individual tax returns.  In addition, the IRS has 2 million Forms 941 (Employer Quarterly Tax Returns) that must be processed before the nearly 500,000 amended Forms 941 can be processed.

In many cases, the delayed processing of amended returns has been devastating to small businesses in our communities whose applications for emergency loans from the Small Business Administration have been caught in limbo nearly two years after the COVID-19 pandemic began. The situation has deteriorated to a point that the Taxpayer Advocate Service (TAS) will no longer accept cases solely involving the processing of amended returns. This has made it impossible for frustrated taxpayers to find any help.  When our constituents cannot get assistance from the IRS and TAS, they contact us, and we have our hands tied at this point as well. 

Recognizing the extraordinary challenges of the COVID-19 pandemic, in addition to the IRS operating with antiquated technology and a constrained budget, we find the current situation alarming. We stand ready to support the IRS and look forward to hearing how we can help you address any obstacles facing the agency. However, we respectfully request the IRS consider the following measures to bring immediate relief to taxpayers, and reduce the backlog, during this tax filing season:

  • Halt automated collections from now until at least 90 days after April 18, 2022;
  • Delay the collection process for filers until any active and pending penalty abatement requests have been processed;
  • Streamline the reasonable cause penalty abatement process for taxpayers impacted by the COVID-19 pandemic without the need for written correspondence; 
  • Provide targeted tax penalty relief for taxpayers who paid at least 70 percent of the tax due for the 2020 and 2021 tax year; and
  • Expedite processing of amended returns and provide TAS and congressional caseworkers with timely responses.

While we recognize no single action will alleviate issues that have resulted from difficulties at the IRS spanning administrations of both political parties, these steps would provide our constituents with greater certainty as we enter this year’s filing season. Thank you for your attention to this urgent matter and the dedication of the IRS and Treasury personnel to improving the filing process in these extraordinary times.

Sincerely,

###

WASHINGTON – On the first day of the 2021 tax filing season, Sen. Warner raised concerns with the IRS after hearing from Virginians who are still waiting on their refunds from the 2020 filing season. These delays come as millions of Americans continue to face economic hardship due to the COVID-19 crisis.

In a letter to Treasury Secretary Janet Yellen and IRS Commissioner Charles Rettig, Sen. Warner stressed the importance of getting Virginians their individual tax refunds as soon as possible in order to avoid further processing delays. As of December 31, 2021, there were approximately 6 million unprocessed tax returns from 2020.

“I appreciate the IRS’ efforts to address the significant backlog of unprocessed returns, and recognize the significant challenges the agency has faced in operating during the pandemic while implementing major programs such as the stimulus payments and the Advance Child Tax Credit payments,” wrote Sen. Warner. “However, persistent delays harm taxpayers who are waiting for their returns to process – often those who need their refunds most –  and the agency has an obligation to implement a clear plan that alleviates this backlog while avoiding major delays for the processing of filed returns during the 2021 tax filing season.” 

This letter follows up on a February 2021 letter addressing the same issue of persistent processing delays at the IRS.

“Since my last letter, I have continued to hear from constituents that have still not had their 2020 tax returns processed, which has also caused delays in receiving the Advance Child Tax Credit payments, stimulus payments, tax refunds, and other much needed financial aid from the IRS,” Warner noted. “Additionally, businesses that have pending tax returns face delayed processing of their SBA EIDL loan applications. Taxpayers have increasingly expressed to my staff that they are unable to garner any information related to the processing of their tax returns via IRS phone lines or the website.”

In order to further understand the ongoing situation, Sen. Warner asked for answers to the following questions:

  1. What formal plans have the IRS and Treasury developed to resolve the significant backlog of individual and business tax returns that remain unprocessed from the 2020 tax filing season?
  2. How specifically will that plan allow the IRS to continue to process the backlog in parallel with the processing of returns for the tax year 2021 filing season?
  3. Will taxpayers whose 2020 returns remain unprocessed or delayed face any difficulties in filing returns – electronically or in paper form – for the 2021 tax year?  If so, what might these delays or difficulties be, what are your specific plans for addressing them, and how will taxpayers be informed in a timely fashion?
  4. When do you anticipate that the Taxpayer Advocate Service (TAS) will resume accepting inquiries related to the processing of amended tax returns?  If TAS is unable to accept this casework, will the IRS dedicate other resources to assist with inquiries that TAS is unable to accept?

Throughout the COVID-19 pandemic, Sen. Warner has been a strong advocate for Virginians, working to ensure that they get the funds to which they are entitled. In April 2020, he pressed the Treasury Department to ensure that families who are not normally required to file taxes do not need to wait until the following year to receive the additional $500 payment per dependent child that they were promised. He also successfully pushed the Treasury Department to allow Social Security recipients to automatically receive CARES Act direct cash assistance without needing to file a tax return.

A copy of the letter is available here and below.

Dear Secretary Yellen and Commissioner Rettig,

I write today to express my concern with the alarming number of my constituents who have not received their long-awaited tax refund from their 2020 taxes.  As you are well aware, millions of Americans are still facing economic hardships and are desperately in need of these funds to help make ends meet.

In my letter to you on February 8, 2021, I noted that as of November 6, 2020 there were approximately 6.8 million unprocessed tax returns.  As of December 31, 2021, there are still 6 million unprocessed tax returns; additionally, as of January 8, 2022, there are still 2.3 million unprocessed 1040-X, and 1.1 million unprocessed business tax returns as of January 12, 2022.

Since my last letter, I have continued to hear from constituents that have still not had their 2020 tax returns processed, which has also caused delays in receiving the Advance Child Tax Credit payments, stimulus payments, tax refunds, and other much needed financial aid from the IRS. Additionally, businesses that have pending tax returns face delayed processing of their SBA EIDL loan applications. Taxpayers have increasingly expressed to my staff that they are unable to garner any information related to the processing of their tax returns via IRS phone lines or the website. 

On November 10, 2021, National Taxpayer Advocate Erin Collins announced that the Taxpayer Advocate Service (TAS) would no longer accept congressional inquiries solely related to the processing of amended tax returns, due to the agency not being able to meaningfully expedite or improve case resolution for taxpayers.  Ms. Collins also issued a Taxpayer Advocate Directive directing the IRS to “complete processing of all backlogged amended tax returns by December 29, 2021 or provide a detailed plan for completing processing the backlog”.  The absence of assistance from TAS further aggravates the problems my constituents and other Americans face.  

I appreciate the IRS’ efforts to address the significant backlog of unprocessed returns, and recognize the significant challenges the agency has faced in operating during the pandemic while implementing major programs such as the stimulus payments and the Advance Child Tax Credit payments. However, persistent delays harm taxpayers who are waiting for their returns to process – often those who need their refunds most –  and the agency has an obligation to implement a clear plan that alleviates this backlog while avoiding major delays for the processing of filed returns during the 2021 tax filing season. 

Please reply to me as soon as possible, and no later than February 4, 2022, with specific answers to the following questions:

  1. What formal plans have the IRS and Treasury developed to resolve the significant backlog of individual and business tax returns that remain unprocessed from the TY 2020 tax filing season?
  2. How specifically will that plan allow the IRS to continue to process the backlog in parallel with the processing of returns for the tax year 2021 filing season?
  3. Will taxpayers whose 2020 returns remain unprocessed or delayed face any difficulties in filing returns – electronically or in paper form – for the 2021 tax year? If so, what might these delays or difficulties be, what are your specific plans for addressing them, and how will taxpayers be informed in a timely fashion?
  4. When do you anticipate that TAS will resume accepting inquiries related to the processing of amended tax returns?  If TAS is unable to accept this casework, will the IRS dedicate other resources to assist with inquiries that TAS is unable to accept?

Thank you for your attention to this important matter.

 

Sincerely,

###

 

 

 

WASHINGTON– U.S. Sens. Mark Warner (D-Va.), former Governor of Virginia; Tom Carper (D-Del.), former Governor of Delaware; and Angus King (I-Maine), former Governor of Maine, today released the following statement:

“As former governors, we care deeply about closing the tax gap and making sure everyone is paying their fair share. Misconceptions of what the financial reporting proposal would do should not derail us from this important goal. We are committed to working with our colleagues to address any concerns with proposals to close the tax gap and to make sure that wealthy taxpayers and corporations pay the taxes that they have the ability to pay and legally owe.”

###

WASHINGTON – U.S. Sens. Mark R. Warner (D-VA) and Bill Hagerty (R-TN) introduced legislation to provide much-needed tax relief to working artists by updating the Qualified Performing Artist (QPA) tax deduction, which allows certain performing artists to deduct the cost of expenses incurred in the course of their employment. The Performing Artist Tax Parity Act would update the thresholds of the QPA deduction to ensure that more lower- and middle-income artists can benefit from the tax break.

The Performing Artist Tax Parity Act is endorsed by numerous organizations advocating for the rights of emerging artists, including the Department for Professional Employees, AFL-CIO, the Actors’ Equity Association, the Theatre Communications Group, the Recording Academy, and the Nashville Songwriters Association.

“The COVID-19 pandemic has been devastating for performers and artists,” Sen. Warner said. “Even as widespread vaccinations allow venues to reopen, many actors, musicians and performing artists are still struggling to recover. I’m glad to be working on a bipartisan solution to help ease some of the burden on working artists during a very difficult time.”

“As a son of Tennessee and my state’s former Commissioner of Economic & Community Development, I appreciate how vital our entertainment sector is to both Tennessee’s rich culture and its economy,” Sen. Hagerty said. “I’m pleased to introduce and work on a bipartisan basis with Senator Warner on this important legislation that will help Tennessee’s creative industry and the performing artists who make it truly thrive. Under our legislation, lower- and middle-income performing artists from Mountain City to Memphis will get to keep much more of their hard-earned wages because it updates a Reagan-era tax deduction that helps artists account for the costs of work-related expenses and adjusts it for the damaging impacts of inflation.”

The Qualified Performing Artist tax deduction has not been updated since its inception in 1986 and is currently only available to those making less than $16,000 a year, meaning that very few artists qualify. The Performing Artist Tax Parity Act will update and increase the income ceiling to $100,000 for individuals and $200,000 for married joint filers, allowing many more lower and middle-income performing artists to receive tax relief for work-related expenses. 

A copy of the bill text can be found here. Companion legislation has been sponsored in the House of Representatives by Reps. Judy Chu (D-CA) and Vern Buchanan (R-FL).   

“I want to thank Senator Mark Warner and Senator Bill Hagerty for drafting and introducing this important legislation. They are great champions of the creative professionals that keep our industry successful,” said SAG-AFTRA president Fran Drescher. "We have been fighting for this legislation because it will allow working class entertainment and media professionals legitimate deductions so that they can retain more of their hard earned money during these most challenging times.”

“I am grateful for the leadership of Senators Warner and Hagerty as they fight for tax fairness for performing artists while the industry is in a historic crisis,” said Kate Shindle, president of Actors’ Equity Association. “The overwhelming majority of Equity stage managers and actors are working-class people who work hard to make ends meet, and unlike other workers, they often have to spend 30 percent of their income on business expenses. Our producers can deduct their business expenses, and we should be able to do so too. The Performing Artist Tax Parity Act will put more money in the pockets of working performers when they need it the most as we work toward recovery in the arts sector.”

“Ensuring union creative professionals can once again deduct work expenses is a top priority for DPE and our affiliated unions in the arts, entertainment, and media industries. We commend Senators Warner and Hagerty for introducing this important legislation in the Senate, which will put money back in the hands of hard-working, middle class professionals,” said Department for Professional Employees, AFL-CIO (DPE) President Jennifer Dorning.

“As the Senate Finance Committee moves to complete deliberations on its fiscal 2022 tax proposals, it should be noted that the more than 80,000 professional musicians of the American Federation Musicians have long used the Qualified Performing Arts Tax Parity Act provisions of the IRS code to recover usual and necessary expenses that employers in this industry have for decades refused to reimburse,” said AFM President Ray Hair. Working musicians continue to struggle while recovering from the loss of a bulk of their live music performance income due to the COVID19 pandemic. The Performing Artist Tax Parity Act is sensible legislation that we can all agree on.  It will restore these deductions and help musicians and other entertainment professionals recover from the ravages of the pandemic, which brought our industry to a screeching halt, while helping working artists and their families become whole again.”

“I commend Senators Warner and Hagerty for joining Representatives Chu and Buchanan in putting aside partisanship to help thousands of middle class behind-the-scenes entertainment workers and creative professionals,” stated IATSE International President Matthew D. Loeb. “The inability to deduct work expenses has been hurting our members long before the COVID-19 pandemic shut down our work and wiped out our wages. Now, with a full return to work in sight, Congress should pass this bill, establish tax fairness, and ensure our workers come back stronger than before.”

“Theatre Communications Group is pleased to endorse the Performing Artist Tax Parity Act, a tax correction sorely needed by performing artists, especially now, as their lives have been upended by COVID-19,” said Laurie Baskin, Director of Advocacy for Theatre Communications Group.

“RIAA strongly supports this bipartisan effort to make the tax code work for artists and musicians. This legislation will strengthen our music ecosystem and create new jobs and opportunities in touring, recording, and more – all while opening the door just a little wider for the next generation trying to break through. We applaud Senators Warner and Hagerty for fighting for tax fairness for working artists and musicians,” said RIAA CEO Mitch Glazier.

###

 

 

You can watch a video message about the tax credit from Senator Warner here and Senator Kaine here.

WASHINGTON, D.C. — Today, on the eve of the historic Child Tax Credit payments beginning for 39 million families across the nation, U.S. Senators Mark R. Warner and Tim Kaine released the following statement applauding the new monthly payment to millions of U.S. households. Starting July 15, eligible parents will begin receiving automatic monthly payments for the next six months of $250 for every child aged 6 to 17 and $300 for every child under 6. The American Rescue Plan, which both Warner and Kaine voted for, made these payments possible. An estimated 1.6 million children across Virginia will benefit from the expanded child tax credit, including 249,000 children in the Commonwealth who are currently in poverty. The expansion will lift 85,000 Virginia children out of poverty.

“The pandemic has taken a devastating toll on families across the Commonwealth, exacerbating the challenges that low- and middle-income families face,” said the Senators. “In response, Democrats expanded the Child Tax Credit and instructed IRS to make advance payments as part of the American Rescue Plan. These monthly payments will make a huge difference in the lives of families in Virginia and across the nation by providing low- and middle income parents with money to help pay for necessities like food, housing, and health care. We are proud to have supported this expansion, which will cut child poverty in half and improve lives across the Commonwealth.”

To qualify for the monthly Child Tax Credit payments, families must have:

  • ·Filed a 2019 or 2020 tax return and claimed the Child Tax Credit on the return; or given their information in 2020 to the IRS to receive the Economic Impact Payment using the Non-Filers: Enter Payment Info Here tool; and
  • ·A main home in the United States for more than half the year (the 50 states and the District of Columbia) or file a joint return with a spouse who has a main home in the United States for more than half the year; and
  • ·A qualifying child who is under age 18 at the end of 2021 and who has a valid Social Security number; and
  • ·Made less than certain income limits: households earning less than $75,000 for single filers, $112,500 for heads of households, and $150,000 for joint filers.

Warner and Kaine urge eligible Virginia families to make sure they receive their checks by visiting the IRS website to ensure they are enrolled. Most families who are eligible will not need to do anything to receive these payments; IRS will use the information they have on file to automatically deposit the funds into their bank account or through a mailed check.

If you believe you are eligible but have not filed a tax return for 2019 or 2020, please file your return or register for payments as a non-filer to automatically receive your monthly payment. For more information, click here

###

WASHINGTON – Today, U.S. Senator Mark R. Warner (D-Va.) joined U.S. Senators Michael Bennet (D-Colo.) and Mike Crapo (R-Idaho) and a bipartisan group of their colleagues in urging U.S. Senators Patrick Leahy (D-Vt.), Chairman of the Senate Committee on Appropriations, and Richard Shelby (R-Ala.), Vice Chairman of the Senate Committee on Appropriations, to fully fund the Payments in Lieu of Taxes (PILT) program for fiscal year (FY) 2022. PILT provides payments to counties with non-taxable federal land within their borders to offset the lost property tax revenue. 

“Without full funding for the PILT program, counties across the nation will be unable to provide essential services such as law enforcement, education, search and rescue, road maintenance and public health to their residents and millions of visitors to our public lands,” wrote Warner, Bennet, Crapo, and the senators. “Moving forward, we look forward to working with you to enact a fiscally responsible, long-term solution to fully fund PILT and eliminate the uncertainty that counties face each year. As cash strapped counties across the country work to address budget cuts exacerbated by the pandemic, full-funding and a long-term solution for PILT is essential to provide certainty that the federal government will continue to uphold its long-standing commitment to public lands counties.”

PILT funding is critical for communities in Colorado and across the country that use these funds for essential services like infrastructure maintenance and law enforcement. Across the country, PILT provides critical resources to nearly 1,900 counties across 49 states. Counties have used these payments for more than 40 years to fund law enforcement, firefighting, emergency response, and other essential county services. As communities continue to rebuild in the aftermath of the Coronavirus Disease 2019 (COVID-19) pandemic, this funding is needed now more than ever. Bennet and the senators will continue working toward a long-term solution for PILT that will provide counties and local governments sustained funding and more predictability.

In addition to Bennet and Crapo, the letter was signed by U.S. Senators Joe Manchin (D-W. Va.), James Risch (R-Idaho), Tina Smith (D-Minn.), Mitt Romney (R-Utah), Tim Kaine (D-Va.), Steve Daines (R-Mont.), Catherine Cortez Masto (D-Nev.), James Inhofe (R-Okla.), Jacky Rosen (D-Nev.), Kevin Cramer (R-N.D.), Maggie Hassan (D-N.H.), Mike Rounds (R-S.D.), John Hickenlooper (D-Colo.), Cynthia Lummis (R-Wyo.), Amy Klobuchar (D-Minn.), John Barrasso (R-Wyo.), Mark Kelly (D-Ariz.), Dan Sullivan (R-Alaska), Maria Cantwell (D-Wash.), Alex Padilla (D-Calif.), Jeanne Shaheen (D-N.H.), Tammy Baldwin (D-Wis.), Mazie Hirono (D-Hawaii), Chris Van Hollen (D-Md.), Ron Wyden (D-Ore.), Gary Peters (D-Mich.), Jon Tester (D-Mont.), Bernie Sanders (I-Vt.), Debbie Stabenow (D-Mich.), Kyrsten Sinema (D-Ariz.), Ben Ray Luján (D-N.M.), Dianne Feinstein (D-Calif.), and Martin Heinrich (D-N.M.).

The text of the letter is available HERE and below.

Dear Chairman Leahy and Vice Chairman Shelby:

As Members of Congress representing counties with federal public lands within their boundaries, we write to request that you work to ensure the Payments in Lieu of Taxes (PILT) program is fully funded in fiscal year (FY) 2022.

PILT provides critical resources to nearly 1,900 counties across 49 states to offset lost property tax revenue due to the presence of tax-exempt federal lands within their jurisdictions. It supports the many critical services that counties provide on federal public lands. Without full funding for the PILT program, counties across the nation will be unable to provide essential services such as law enforcement, education, search and rescue, road maintenance and public health to their residents and millions of visitors to our public lands.

Moving forward, we look forward to working with you to enact a fiscally responsible, long-term solution to fully fund PILT and eliminate the uncertainty that counties face each year. As cash strapped counties across the country work to address budget cuts exacerbated by the pandemic, full-funding and a long-term solution for PILT is essential to provide certainty that the federal government will continue to uphold its long-standing commitment to public lands counties.

We look forward to working with you and other Congressional leaders to resolve this pressing issue facing our communities by fully funding PILT in FY 2022 and ensuring long-term predictable funding for this important program.

Sincerely,

###

 

 

WASHINGTON – U.S. Senator Mark R. Warner (D-VA), Chairman of the Senate Select Committee on Intelligence, joined Senators Maggie Hassan (D-NH), a member of the Senate Finance Committee, and Ron Wyden (D-OR), Chairman of the Committee, and a group of their colleagues in urging the Internal Revenue Service (IRS) to challenge any abusive tax deductions that opioid companies may take for settlements that they are paying out related to their role in fueling the opioid epidemic.

The Senators’ letter follows recent reporting indicating that, after being sued by state or local governments for harmful practices, opioid companies are planning to manipulate the tax code in order to claim billions of dollars in tax benefits. The Senators are calling on the IRS to use the full extent of its authority under recent regulations to challenge these tax schemes. “We strongly encourage the IRS to fully enforce the tax code by challenging any erroneous interpretations of these recent regulations that opioid companies may use in an attempt to claim tax deductions for legal settlement expenses,” wrote the Senators.

In addition to Senators Hassan and Wyden, the letter was signed by Senators Brian Schatz (D-HI), Chris Van Hollen (D-MD), Tammy Baldwin (D-WI), Sheldon Whitehouse (D-RI), Angus King (I-ME), Debbie Stabenow (D-MI), Catherine Cortez Masto (D-NV), Jack Reed (D-RI), and Bob Menendez (D-NJ).

Read the Senators’ full letter here or below:

Dear Commissioner Rettig: 

We write to urge the Internal Revenue Service to use the full extent of its authority to challenge any abusive tax deductions claimed by opioid companies for expenses related to legal settlements regarding these companies’ role in fueling the opioid crisis.

Recent reporting indicates that four companies involved in the multi-district opioid litigation collectively plan to claim billions of dollars in tax deductions for expenses related to a pending $26 billion settlement with state and local governments, which sued these companies for their role in fueling the opioid epidemic. Similarly, in 2019, a judge ordered one of these companies to pay $572 million to the State of Oklahoma for misleading marketing of its opioid products. Based on this reporting, we are concerned that opioid wholesalers and drug companies may mischaracterize legal settlement expenses in order to claim tax deductions under tax code section 162(f), which allows the deduction of restitution payments. 

In January 2021, the IRS published TD 9946, final regulations regarding the deductibility of legal settlement expenses under section 162(f). We strongly encourage the IRS to fully enforce the tax code by challenging any erroneous interpretations of these recent regulations that opioid companies may use in an attempt to claim tax deductions for legal settlement expenses. 

We thank you for your attention to this important issue.

###

WASHINGTON – U.S. Sen. Mark R. Warner (D-VA) raised concern with the Internal Revenue Service (IRS) after hearing from an alarming number of Virginians who have yet to receive their second economic impact payment (EIP) or long-awaited tax return. These troubling delays come as millions of Americans find themselves in desperate need of a financial lifeline after continuing to face economic hardship due to the COVID-19 crisis.

“I am deeply appreciative of the Internal Revenue Service’s (IRS) work during the pandemic. The agency has delivered hundreds of millions of EIPs to Americans, all while managing the risks associated with COVID-19 and the need to protect our public servants at the IRS,” wrote Sen. Warner in his letter to Treasury Secretary Janet Yellen and IRS Charles Commissioner Rettig.“However, while the IRS has made an effort to provide timely and updated information on their website, my constituents continue to be frustrated with their inability to navigate some of the issues that are delaying their tax refunds and their second round of EIPs.”

As of November 19, 2020, there were an estimated 3.3 million pieces of unopened mail – including 1.6 million tax returns – at the IRS’ four Submission Processing Centers.

Currently, taxpayers who do not receive their economic impact payment must claim these funds by filing a tax return. This threatens to further delay needed payments, and poses a particularly burdensome problem for Social Security recipients and other vulnerable populations, who may be forced to file a tax return despite not normally having a tax filing obligation. 

In his letter, Sen. Warner also stressed the IRS’ responsibility to process individual tax returns and issue refunds as quickly as possible. In order to further understand the ongoing situation, Sen. Warner asked for answers to the following series of questions: 

  1. What is the current IRS backlog of paper tax returns and correspondence specifically at the Kansas City, MO location where Virginians’ tax returns are processed? When does the IRS project it will be finished processing the backlog? Can the IRS commit to providing more frequent updates on the backlog?
  2. As the nation continues to work through the effects of the COVID-19 pandemic, what steps is the agency taking to prepare for the upcoming tax filing season and to process all returns, whether filed electronically or by U.S. Mail, as quickly as possible?
  3. For taxpayers who have filed their Forms 1095-A and 8962, when can they expect to have that form processed by the IRS?
  4. For the second EIP, how many payments have been successfully delivered?  How many payments have been returned to the IRS? Why are some constituents who received the first EIP now having issues accessing the second? 

During the COVID-19 crisis, Sen. Warner has been a strong advocate for Virginians, working to ensure that they get the funds to which they are entitled. Last April, he pressed the Treasury Department to ensure that families who are not normally required to file taxes do not need to wait until the following year to receive the additional $500 payment per dependent child that they were promised. He also successfully pushed the Treasury Department to allow Social Security recipients to automatically receive CARES Act direct cash assistance without needing to file a tax return.

Text of the letter is available here and below. 

 

Dear Secretary Yellen and Commissioner Rettig,

I write today to express my concern with the alarming number of my constituents who have not received their long-awaited tax refund or the second economic impact payment (EIP). As you are well aware, millions of Americans are facing economic hardships and are desperately in need of these funds to help make ends meet. 

I am deeply appreciative of the Internal Revenue Service’s (IRS) work during the pandemic. The agency has delivered hundreds of millions of EIPs to Americans, all while managing the risks associated with COVID-19 and the need to protect our public servants at the IRS. I applaud your responsiveness to Congress and the agency’s focus on delivering vital assistance to Americans in dire need of support. However, while the IRS has made an effort to provide timely and updated information on their website, my constituents continue to be frustrated with their inability to navigate some of the issues that are delaying their tax refunds and their second round of EIPs.

I understand that as of November 7, 2020, there were approximately 6.8 million individual paper return in various processing stages at the four Submission Processing Centers.  Commissioner Rettig stated in his November 19, 2020, letter to my office that there were “an estimated 3.3 million pieces of unopened mail at these four locations, including 1.6 million tax returns.”

Since the November 19, 2020 letter from Commissioner Rettig, I have continued to hear from constituents that still have not had their 2019 tax returns processed or received their refunds. In addition, my constituents report that they have not received their second EIP despite many of these constituents reporting that they received their previous payment via direct deposit, and the agency’s Get My Payment Tool indicates their payment was authorized and mailed on January 6, 2021. Because taxpayers who do not receive their EIP must claim their payment by filing a tax return and claiming the Recovery Rebate Credit, many taxpayers face the possibility of even lengthier waits to receive their payment, including many who do not normally have a tax filing obligation. As you know, this population includes Social Security recipients and the most vulnerable in our county. 

In addition, constituents continue to indicate that they are not receiving refunds due to lags in processing Health Insurance Marketplace Statements (Form 1095-A) and Premium Tax Credits (Form 8962), which are required if they receive their healthcare from the Affordable Care Act marketplace.

I appreciate the enormity of the challenges that the agency faces in trying to conduct its work while keeping its workers safe from COVID-19. However, the agency has a responsibility to process individual tax returns and issue all refunds that taxpayers are entitled to as quickly as possible and to be as communicative as possible.

To help me respond adequately to my constituents, please answer the following questions:

  1. What is the current IRS backlog of paper tax returns and correspondence specifically at the Kansas City, MO location where Virginians’ tax returns are processed? When does the IRS project it will be finished processing the backlog? Can the IRS commit to providing more frequent updates on the backlog?
  2. As the nation continues to work through the effects of the COVID-19 pandemic, what steps is the agency taking to prepare for the upcoming tax filing season and to process all returns, whether filed electronically or by U.S. Mail, as quickly as possible?
  3. For taxpayers who have filed their Forms 1095-A and 8962, when can they expect to have that form processed by the IRS?
  4. For the second EIP, how many payments have been successfully delivered?  How many payments have been returned to the IRS? Why are some constituents who received the first EIP now having issues accessing the second?

I know the IRS is working diligently to serve the American people, and I welcome our continued collaboration to help Americans across the country. Thank you for your attention to this important issue.

###

WASHINGTON – Today U.S. Sen. Mark R. Warner (D-VA) sent a letter to Internal Revenue Service (IRS) Commissioner Charles Rettig and Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma urging them to ensure that families aren’t denied critical financial assistance needed in order to purchase quality health insurance through the Affordable Care Act (ACA). The letter comes after Sen. Warner’s office heard from Virginia families, including the Burger family, who discovered that they were wrongfully denied tax credits due to delays in processing 2019 tax filings that are required to purchase affordable health insurance through the ACA marketplace exchanges. The deadline to enroll for the ACA is December 15. 

“I am writing to draw your attention to an issue that could cause a significant number of individuals to be denied affordable health insurance on the Affordable Care Act (ACA) Marketplace. It is my understanding that due to delayed processing of 2019 tax returns, numerous Americans have been deemed in violation of the Marketplace’s ‘failure to file and reconcile’ requirement (FTR), and will be ineligible for advanced premium tax credits (APTCs) to ensure affordable health coverage starting January 1, 2021,” wrote Sen. Warner to IRSCommissioner Rettig and Administrator Verma.

The Affordable Care Act (ACA) established advanced premium tax credits (APTC) to help working families purchase affordable health insurance through the exchanges. In order to receive the tax credit during this year’s enrollment period, individuals have to complete their 2019 tax return. However, because of the COVID-19 pandemic, the IRS has not been able to process these returns in a timely manner due to reduced staff hours at the agency. As a result, individuals who would normally be eligible for the credit cannot receive it because the IRS has not yet processed their returns. 

“Put simply, a number of Americans will be denied an APTC in the Marketplace through no fault of their own, because their tax returns were delayed. I have already heard from several Virginians who – as a direct result of delayed tax returns – have been unable to or confused about their ability to enroll in health care coverage during this years’ open enrollment period,” continued Sen. Warner. “Financial assistance is essential to millions of working class Americans and their families to ensure affordable health coverage on the Marketplace. I am concerned that individuals will be wrongfully denied coverage and that a failure to address this issue could result in these families going without health care coverage during the peak of an unprecedented global pandemic.”

In his letter, Sen. Warner also pressed the Administration to suspend termination of the 2021 APTC, inform affected enrollees of this change, and extend the deadline to apply for 2021 ACA coverage through a special open enrollment period for individuals and families wrongfully denied financial assistance.  

Text of the letter is available here or below.

 

Dear Commissioner Rettig and Administrator Verma:

I am writing to draw your attention to an issue that could cause a significant number of individuals to be denied affordable health insurance on the Affordable Care Act (ACA) Marketplace. It is my understanding that due to delayed processing of 2019 tax returns, numerous Americans have been deemed in violation of the Marketplace’s “failure to file and reconcile” requirement (FTR), and will be ineligible for advanced premium tax credits (APTCs) to ensure affordable health coverage starting January 1, 2021. 

Under existing Marketplace regulations, an enrollee becomes ineligible for an APTC if they did not file an income tax return for a prior year during which an APTC was received. However, in response to the COVID-19 pandemic, Treasury delayed the tax filing deadline for all Americans from April 15, 2020 to July 15, 2020. In addition, the Internal Revenue Service (IRS) has cut staff hours as result of the COVID-19 pandemic and continues to experience significant tax return processing delays. 

Put simply, a number of Americans will be denied an APTC in the Marketplace through no fault of their own, because their tax returns were delayed. I have already heard from several Virginians who – as a direct result of delayed tax returns – have been unable to or confused about their ability to enroll in health care coverage during this years’ open enrollment period. 

Financial assistance is essential to millions of working class Americans and their families to ensure affordable health coverage on the Marketplace. I am concerned that individuals will be wrongfully denied coverage and that a failure to address this issue could result in these families going without health care coverage during the peak of an unprecedented global pandemic.

I urge you to address this problem by suspending the termination of 2021 APTC. In addition, I ask that you inform affected enrollees of this change and extend the deadline to apply for 2021 coverage through a special open enrollment period for individuals who were deterred from enrolling due to the previous notices they received threatening to end their financial assistance.

Thank you for your attention to this important matter, and I look forward to hearing back from you.

Sincerely,

Mark R. Warner

U.S. Senator

 

 

###