| Moderate Democrats Balk at Biden’s Proposed Capital Gains Tax on Inherited Assets
Moderate Congressional Democrats are expressing concern over the Biden Administrations proposed tax proposals including a plan to eliminate the stepped-up basis for unrealized gains at death that would impose a tax capital gains over $1 million on inherited assets. In a letter to House Speaker Nancy Pelosi (D- CA) and other House leaders, thirteen Democratic lawmakers said the requirement to recognize capital gains at death runs the risk of forcing small businesses and family farms to sell off assets rather than pass them down to the next generation. The letter, authored by Representatives Cindy Axne (D-IA) and Jim Costa (D-CA) went on to say, “We strongly urge you to provide full exemptions for these family farms and small businesses that are critical to our community.”
Democrats hold a narrow majority in the House and a 50-50 split in the Senate with Vice President Kamala Harris having the tie-breaking vote. Republicans are unified in resisting tax increases. If the Democrats use a parliamentary maneuver to avoid a Republican filibuster in the Senate, they will need to maintain the support of all 50 democrats to get the President’s tax proposals through Congress. The recent letter from House Democrats shows that could be a challenge when it comes to tax proposals needed to fund the $1.8 trillion American Families Plan which would expand childcare, nutrition, education and health care and other programs. A summary of the American Families Plan indicates that high capital gains taxes would not apply to family farms and small businesses that are bequeathed to heirs who continue to run them, but critics say the carve-out could be difficult to execute given the details of inheritance. In addition to ending stepped-up basis, Biden’s tax proposals include raising the highest income tax rate for families making more than $400,000 annually and adjusting the capital gains rate to that level as well as a health care surcharge for families making more than $1 million annually.
Thank You to Our Virtual Washington Conference Partner Sponsors!
EMA wants to extend a huge THANK YOU to our Virtual Washington Conference 2021 Partner Sponsors: Federated Insurance, Phillips 66, Renewable Energy Group, Inc., RAI Trade Marketing Services Company, Altria Group Distribution Company, Patriot Capital and Meridian Associates, Inc.
We appreciate the loyalty and generous support of our Corporate Partners and their continuous commitment to the energy industry. For more information on our Partner Programs, please contact Susan Isard.
EMA looks forward to seeing everyone at our Fall Meeting at the NACS Show at InterContinental Chicago October 4-5, 2021.
Lawmakers Concerned over Enhanced Unemployment Benefits
For many Marketers, concerns over whether enhanced unemployment benefits are making it more difficult for businesses to get employees back to work are nothing new. This week, the issue gained fresh attention following the Bureau of Labor Statistics’ release of the April jobs report which reflected surprisingly disappointing job growth numbers.
On Tuesday, a coalition of nine GOP Senators, led by Senator Roger Marshall (R-KS), introduced the Get Americans Back to Work Act. Identical legislation was also introduced in the House on the same day. Spanning just two pages, the Get Americans Back to Work Act is as straight forward as legislative proposals come. Starting on May 31, 2021, it would decrease the amount that an individual can receive in additional federal unemployment benefits from $300 per week to $150 per week. It would then completely eliminate the enhanced benefits as of June 30, 2021. As things currently stand after the passage of the last COVID relief package, the $300 per week federal enhanced unemployment benefits are set to continue through September 6, 2021 though eleven states have announced that they will stop participating in the federal program before that date.
Also, this week, Senator Ben Sasse (R-NE), introduced the National Signing Bonus Act. Under Senator Sasse’s proposal, individuals who start a new job by July 4 and continue in that position would be eligible for a federally funded signing bonus (paid out across multiple payments) equal to roughly two months of what they would have gotten through expanded unemployment benefits had they remained unemployed. The idea behind this proposal is to replace the last two months of enhanced unemployment benefits with a signing bonus for workers who might be financially unmotivated to return to work before the program ends in September.
While the White House has denied that enhanced unemployment benefits are the driving force behind the poor April jobs numbers, the data and developments on Capitol Hill did prompt a series of actions from the Administration. On Monday, the White House issued a Fact Sheet announcing, “Additional Steps to Help Americans Return to Work.” Of note, as part of these initiatives, the President directed the Secretary of Labor to work with states to reinstate their work search requirements. As a matter of background, the federal enhanced unemployment benefits were first introduced as part of the Families First Coronavirus Response Act (FFCRA) which President Trump signed into law on March 18, 2020.
Under the FFCRA, in order to participate in the federal program to receive these enhanced benefits, states were required to waive their standard unemployment rules that would have required individuals to be actively searching for work in order to qualify for benefits. This federal condition has since been lifted and more than half of the states (29 to be exact) have reinstated their work search requirements. The idea behind the Administration’s push for all states to follow suit is that this will eliminate a worker’s ability to choose between taking a job that is available to them and continuing to receive enhanced unemployment benefits. With work search requirements, only those employees who genuinely cannot find suitable employment would be eligible for any unemployment benefits, including the enhanced federal benefits.
House Poised to Pass Pregnant Workers Fairness Act
Today, the House is expected to pass the Pregnant Workers Fairness Act (H.R. 1065). The bill is co-sponsored in the House by 208 Democrats and 20 Republicans.
If it becomes law, the Pregnant Workers Fairness Act would apply to all public employers and private employers with 15 or more employees. These employers would be required to provide reasonable accommodations to any employee or job applicant who might need an accommodation due to pregnancy, childbirth or a related medical condition. Under the new law, employers would be prohibited from requiring employees to take leave (paid or unpaid) instead of being provided with an accommodation. Employers would only be excused from providing an accommodation if they can establish that doing so would impose an undue hardship (as defined by law). The Pregnant Workers Fairness Act would also prohibit employers from refusing to hire or otherwise denying opportunities to any individuals because they may need a pregnancy or childbirth related accommodation. For businesses that operate in jurisdictions with more rigorous state and local employment laws – the provisions of the Pregnant Workers Fairness Act may sound familiar as many states and localities have already enacted similar statutes.
The level of support for the bill in the Senate is not entirely clear. However, a Senate version of the Pregnant Workers Fairness Act was recently introduced by Senators Bob Casey (D-PA), Bill Cassidy (R-LA), Jeanne Shaheen (D-NH), Tina Smith (D-MN), Shelley Moore Capito (R-WV) and Lisa Murkowski (R-AK). Assuming that Senators Cassidy, Capito and Murkowski support the House version of the bill and no Democrats defect, the bill is already close to having the votes it would need for passage in the Senate. President Biden supports the bill.
Congressional Update
On Wednesday, President Biden and Vice President Harris held infrastructure discussions with the “big four” Congressional leaders: Speaker Nancy Pelosi (D-CA), Senate Majority Leader Chuck Schumer (D-NY), House Minority Leader Kevin McCarthy (R-CA), and Senate Minority Leader Mitch McConnell (R-KY). Republican leadership reiterated their opposition to using tax increases to pay for infrastructure, and also pushed back on the $170 billion the White House has proposed to support the EV industry. The Congressional leaders and the White House agreed to keep talking, though President Biden’s goal of seeing “progress” on infrastructure before Memorial Day seems unlikely at this point.
The bipartisan conversations continued on Thursday, when President Biden and Vice President Harris held infrastructure discussions with Commerce Secretary Gina Raimondo, Transportation Secretary Pete Buttigieg, and Sens. Shelley Moore Capito (R-WV), John Barrasso (R-WY), Roy Blunt (R-MO), Mike Crapo (R-ID), Pat Toomey (R-PA), and Roger Wicker (R-MS).
Meanwhile in the House, Transportation and Infrastructure Chairman Peter DeFazio (D-OR) said that his draft surface transportation reauthorization legislation would be similar to legislation introduced in the 116th Congress and would be released soon. House Republicans are also planning to release a draft infrastructure framework in the next few weeks. In the Senate, Finance Committee Chairman Ron Wyden (D-OR) said his committee would soon consider legislation that would simplify the tax code by consolidating energy tax credits.
Regulatory Alert: IRS Dyed Fuel Waiver in Response to Colonial Pipeline Closure
The Internal Revenue Service announced this week that it will not impose a penalty when dyed diesel fuel is sold for use or used on the highway in the States of Alabama, Delaware, Georgia, Florida, Louisiana, Maryland, Mississippi, North Carolina, Pennsylvania, South Carolina, Tennessee, Virginia, and the District of Columbia. The IRS is issuing the waiver in response to the Colonial Pipeline closure.
This relief is retroactive to May 7, 2021 and will remain in effect through May 21, 2021.
This penalty relief is available to any person that sells or uses dyed diesel fuel for highway use. In the case of the operator of the vehicle in which the dyed diesel fuel is used, the relief is available only if the operator or the person selling such fuel pays the tax of 24.4 cents per gallon that is normally applied to diesel fuel for highway use.
The IRS will not impose penalties for failure to make semimonthly deposits of this tax. IRS Publication 510, Excise Taxes, has information on the proper method for reporting and paying the tax.
Ordinarily, dyed diesel fuel is not taxed, because it is sold for uses exempt from excise tax, such as to farmers for farming purposes, for home heating use, and to local governments.
The IRS is closely monitoring the situation and will provide additional relief, as necessary.
EMA Contact: Mark S. Morgan, Regulatory Counsel mmorgan@emamerica.org.
EMA Journal Spring Issue Online Now
You can now take EMA Journal with you wherever you go. Click here to view the Spring 2021 Issue (it will be in your mailboxes soon!), optimized for any device. Scroll to select the articles that matter to you, then read, learn and share with the icons at the top of your screen. Looking for a past issue? Scroll through past covers on the left side of your browser or use our convenient search feature to find a particular topic. Miss flipping pages? Select "page view" from the menu bar or click the handy magazine icon for a classic page-turner. You can find our Annual Directory here which is featured in each Fall Issue.
For information on advertising in this valuable format, please call 844.423.7272 or emailInnovative Publishing. Our Summer Issue advertising deadline is June 1, 2021.
EMA Member Services Spotlight Featuring: Priceline from National Purchasing Partners (NPP)
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Enroll your business with NPP for travel discounts and more. NPP has a diverse catalog of business offers as well as deals you can share with your employees.
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EMA Corporate Partner Spotlight Featuring: Renewable Energy Group, Inc.
How to Teach a Customer What Biodiesel Is in Just 1 Minute
How many times has this happened to you? A customer calls talking about switching from heating oil to a “cleaner” heating source like natural gas or electricity, and your CSR responds by politely informing them about the environmental benefits of Bioheat® fuel.
“What is Bioheat fuel,” the customer asks. “It’s heating fuel blended with renewable biodiesel,” your CSR responds. “Oh,” the customer says, “but what’s biodiesel?!”
How do you teach customers what biodiesel is in just 1 minute? Simply show them this 1 minute and 3 second video. It explains biodiesel in terms that every customer can understand, and it can easily be shared via text, email or social media or embedded onto your website (just click the share button on YouTube). If you already have a web page dedicated to Bioheat fuel, this would be the perfect place for it.
For additional information on this topic or about Renewable Energy Group, Inc., please visitor contact Scott Nemec. Renewable Energy Group is an EMA Corporate Platinum Partner.
Federated Insurance Employment Practices Network HR Question of the Month
Federated Insurance’s HR Question of the Month focuses on employment-related practices liability issues. This month’s question is: Change Terms and Conditions on Return from FMLA? Upon return from FMLA leave, an employee must be restored to his or her original job or to an equivalent job with equivalent pay, benefits, and other terms and conditions of employment. When is it to safe to change the job, lower pay and or demote employee? Please click here to read the response.
For additional information or to discuss this in further detail, please contact your Federatedregional representative or EMA’s National Account Executive Jon Medo at 800.533.0472. Federated is an EMA Corporate Platinum Partner.
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