As Congress and the administration continue to work to overhaul the nation’s broken tax code, Senate Finance Committee Chairman Orrin Hatch (R-Utah) today called on tax stakeholders to provide ideas, proposals, and feedback on how to improve the American tax system.
After years of committee hearings, public statements, working groups, and conceptual exercises, Congress is poised to make significant steps toward comprehensive tax reform,” Hatch said in a letter. “Members from both parties have acknowledged the shortcomings of our current tax system and the need for meaningful reforms to encourage economic growth and alleviate many of the burdens imposed on hardworking taxpayers…As we work to achieve those goals, it is essential that Congress has the best possible advice and insight from experts and stakeholders.
NAST has submitted a comment letter to the chairman with the “strong recommendation that Congress maintain the current tax treatment for municipal bonds,” stressing that changes could “inhibit the ability of state and local governments to continue leading in development of and investment in critical infrastructure throughout our country.”
Three quarters of all public infrastructure projects in the United States are built by the states and local governmental entities. Tax-exempt municipal bonds are the primary tool that state and local governments use to finance highways, bridges, transit systems, airports, water and wastewater systems, schools, higher education facilities, and other public infrastructure.
CSPN has submitted a comment letter as well where they strongly encourage him “to consider the importance of post-secondary education to our economy.”
These recommendations include retaining the current federal tax exemption afforded to earnings on 529 accounts and prioritizing tax policies to support saving for college. In addition to adopting current and past legislative initiatives to make saving in a 529 plans even more attractive to moderate income families and remove some of the current disincentives to college savings. These proposals are reflected in legislation introduced by Senators Richard Burr (R-NC) and Bob Casey (D-PA) and in the House of Representatives by Reps. Lynn Jenkins (R-KS) and Ron Kind (D-WI).
Illinois Treasurer Michael Frerichs was in Effingham and Shelby counties recently as part of a larger tour of area communities as he publicized his office’s latest initiatives.
One of those programs, iCash, seeks to pair residents and businesses in Illinois with lost property. Last year, Frerichs says his office hit an all-time high when it came to returning unclaimed property.
“We returned over $155 million,” said Frerichs. “So at a time when the state is not paying its bills, the state isn’t honoring its contracts, the treasurer’s office was writing checks because we think it’s important to get money into the economy.”
Another initiative, the Illinois College Savings program, helps families plan for and prepare children for college-related expenses. Frerichs says since taking office, he has negotiated a drop in the fees charged to participants through one of the state’s two savings plans.
“We cut fees that families were paying on college savings accounts by half,” explained the state treasurer. “Actually, more than half, a 57 percent drop in fees. And what happened when we did that? Morningstar rating service gave us a rating upgrade.”
Following the upgrade, Illinois’ Bright Directions savings program was elevated to one of the top two adviser-sold savings programs in the country.
Since coming into office, Frerichs has also worked on making sure life insurance benefits — more than half a billion dollars worth — are paid out.
“I came in and discovered that life insurance companies that sold policies to people, they died and they never paid out the benefits,” explained Frerichs. “So I think, when that person who had a policy in place dies that money no longer belongs to the insurance company, it belongs to their loved ones. The insurance companies said, ‘No, no. We hold onto it until they come and ask for it.’”
Arising from his audits of two dozen life insurance companies, House Bill 0302 was presented and passed both chambers. The bill would force life Insurance companies to notify beneficiaries going back to 2000 of unpaid benefits and awaits the governor’s signature.
Frerichs was elected as state treasurer in November 2014 after having served as state senator for District 52, which included parts of Champaign and Vermilion counties. Reflecting on his time spent in the General Assembly, Frerichs said the chamber has certainly changed…
Story Excerpt: The National Association of State Treasurers recently outlined some legislative priorities that would broaden ABLE accounts’ reach..