On Sept. 4, the Federal Reserve issued its findings on how U.S. companies are using repatriated funds following the passage of the Tax Cuts and Jobs Act.  According to the report, “U.S. Corporations’ Repatriation of Offshore Profits,” U.S. companies have brought back a little over $300 billion in the first quarter of 2018. Researchers have found that funds repatriated during that period “have been associated with a dramatic increase in share buybacks.” It’s too early to tell whether there will be a corresponding spike in investment, given that such effects may take time to materialize, the report noted.

Congressional Democrats are likely to seize upon the Fed’s preliminary findings to bolster their argument that the 2017 tax law has disproportionately benefited the wealthy.

A copy of the Fed’s report is available here.

The House Ways and Means Committee is looking to the week of Sept. 10 for the markup of Tax Reform 2.0.  Legislative text to the tax-cuts package has not yet been made public; the framework to the legislation was unveiled just before House lawmakers departed for August recess. Ways and Means Chairman Kevin Brady (R-TX) will huddle with House GOP members on Sept. 6 to lay out his plan to advance Tax Reform 2.0. The chairman reiterated this week that he wants a floor vote on the package before the end of September.

Tax policy observers are keeping a close eye on whether Tax Reform 2.0 will actually land on the House floor. There has been chatter that the entire effort might be put on hold given the Aug. 23 release of the Treasury’s proposed rule on charitable contributions and state and local tax credits. The proposal is in response to actions taken by high-tax states to circumvent the $10,000 cap on the state and local tax deduction (SALT) enacted in the Tax Cuts and Jobs Act. Under the proposal, the Treasury would limit the amount that taxpayers can deduct for charitable contributions if they have received state tax credits for their contributions – this specifically targets the workarounds that have been enacted by states like New Jersey and New York. For example, if a taxpayer makes a $50,000 donation and then receives a  $45,000 state tax credit, he or she would only be allowed to write off $5,000 on the federal tax return. Check out the Tax Foundation’s discussion of the proposed rule here.

The Treasury’s shutdown of these workarounds to the SALT cap puts GOP lawmakers from high-tax states in a tough spot when it comes to a vote on Tax Reform 2.0. They would have to choose between voting for the legislation, which would make the cap permanent, or voting against their colleagues on this second round of tax cuts – a tough call in an election year. But at this writing, GOP leaders appear undeterred in their push for a vote on Tax Reform 2.0 before November.


It’s that time of the year again: Lawmakers have about 10 legislative days to pass the FY 2019 appropriations bills to avoid a government shutdown. Despite the Senate taking a shorter recess in August to work on a series of spending packages, Congress will likely again miss its Sept. 30 deadline, which marks the end of the current fiscal year. To the Senate’s credit, floor action on the spending measures has been relatively efficient and drama-free. This year, Senate appropriators made a conscious effort to keep “poison-pill” policy riders from gumming up the annual process. To date, the Senate has amended and approved three “minibus” spending packages:

  • First Minibus (H.R. 5895) – includes the following appropriations bills: (1) Energy-Water, (2) Milcon-VA, and (3) Legislative Branch
  • Second Minibus (H.R. 6147) – includes: (4) Financial Services, (5) Interior-EPA, (6) Transportation-HUD, and (7) Agriculture
  • Third Minibus (H.R. 6157) – includes: (8) Defense and (9) Labor-HHS-Education

Getting nine of the 12 annual spending bills out of the Senate is no small feat, but time is running out. Differences between the House and Senate bills must be resolved before they can be sent to the president for signature. The conference committee for the first minibus has yet to produce an agreement. Consequently, Congress will likely have to approve a short-term extension (known as a “continuing resolution” or “CR”) to keep the government open beyond Sept. 30.

One thing to keep an eye on is whether President Trump will carry out his earlier threat to shut down the government before the midterm elections in order to force appropriators to cough up $5 billion for his border wall. While House appropriators has set aside $5 billion in their Homeland Security spending bill for the wall, Senate appropriators has only provided $1.6 billion in its version of the bill.


Despite an abbreviated August recess, the Senate must complete a long legislative to-do list before Sept. 30, when government funding and a number of authorizations — including Federal Aviation Administration authorities — expire with the end of the fiscal year.

Pending legislation to reauthorize FAA is seen as critical to advancing the commercial unmanned aircraft systems (UAS) industry in the United States, particularly since technology has advanced dramatically since 2012, when Congress last passed a sweeping aviation policy bill. In the meantime, other nations are moving ahead with forward-leaning policies to advance UAS integration and attract investment in this technology.

Businesses seeking to leverage UAS technology are pressuring Congress to enact the legislation to provide certainty for the continued growth and utilization of UAS in the United States. Commercial UAS operators and manufacturers, and end users across industries — from oil and gas, to agriculture and transportation and infrastructure — seek a progressive policy framework that will encourage continued innovation.

Since 2012, Congress has adopted a series of short-term FAA extensions, most recently in March. After several years of delays attributable to a controversial proposal to corporatize Air Traffic Control (ATC), the House voted 393-13 in April to pass its long-term reauthorization bill, H.R.4. The Senate seemed poised to move ahead with its largely noncontroversial bipartisan bill, S.1405, soon thereafter, but that was not the case.

Instead, it’s unclear whether there will be enough floor time for the Senate to take up and pass its bill and negotiate the differences with the House-passed legislation in time to send the president a bill for his signature before Sept. 30. As the Senate continues to process appropriations bills and the November midterm elections inch closer, another short-term extension remains a real possibility.

If the Senate does take up S.1405, it must confront a number of key UAS-related issues on the floor and in conference.

As introduced, the bill does not address unmanned traffic management (UTM), the system that will enable safe, secure integration and the types of advanced autonomous UAS operations that are critical to the commercial use of this technology. Sens. Dean Heller (R-Nev.), Catherine Cortez Masto (D-Nev.) and Mark Warner (D-Va.) have offered an amendment to further shape an FAA-NASA UTM pilot program that is underway and move toward implementation. The amendment is included in a manager’s package of noncontroversial amendments that Chairman John Thune (R-S.D.) plans to move forward, but it differs in several key ways from a UTM provision in the House bill.

Congress previously authorized the departments of Defense and Energy to utilize limited UAS countermeasures operations typically prohibited by federal law. A bill offered by Senate Homeland Security Committee Chairman Ron Johnson (R-Wisc.) and Ranking Member Claire McCaskill (D-Mo.) to extend similar authorities to the departments of Homeland Security and Justice is included in Chairman Thune’s proposed manager’s package. No such provision is included in the House-passed bill, but House Homeland Security Committee Chairman Michael McCaul (R-Texas) has since introduced similar legislation that underscores bicameral, bipartisan support for moving forward.

The 2012 reauthorization allows the FAA to regulate only commercial UAS. With an eye toward resolving the issue in conference, the House adopted two competing and conflicting floor amendments to expand the FAA’s authority to regulate UAS. The underlying Senate bill does not definitively resolve the issue, and it is expected to be addressed in conference.

A number of other key issues still remain, but when or whether FAA reauthorization moves forward will strongly influence the trajectory of the commercial UAS industry and the application of this technology across industries in the United States. Meanwhile, other countries are expediting new laws and regulations to attract investment and innovation in UAS technology.

As Sept. 30 rapidly approaches, U.S. competitiveness hangs in the balance.

Congress returns from recess this week. The House and Senate convene today at 2 p.m. and 3 p.m., respectively.

Grab some popcorn and settle in for the Senate Judiciary Committee’s hearing today for Judge Brett Kavanaugh, nominee to be an associate justice of the U.S. Supreme Court. The hearing is expected to last up to four days.


Bills Under Suspension. The chamber will take up a series of measures related to homeland security and cybersecurity. Here are the noteworthy bills:

  • H.R. 6438 – the DHS Countering Unmanned Aircraft Systems Coordinator Act would establish an unmanned aircraft systems coordinator at the Department of Homeland Security.
  • H.R. 4318 – the Miscellaneous Tariff Bill Act.
  • H.R. 5576 – the Cyber Deterrence and Response Act addresses state-sponsored cyber activities against the U.S.

Minibus Spending Package. Lawmakers will take up a motion to go to conference on H.R. 6157, the third “minibus” spending package for FY 2019 that covers funding for Defense and Labor-HHS-Ed.

LNG Export. Lawmakers will debate H.R. 4606, the Ensuring Small Scale LNG Certainty and Access Act would provide that applications under the Natural Gas Act for the importation and exportation of small volumes of natural gas shall be granted without modification or delay.

H.R. 5895 Conference Report. The chamber may also take up consideration of the conference report to H.R. 5895 – the first FY 2019 minibus package covering funding for Energy and Water, Milcon-VA, and the Legislative Branch.


SEC Nominee. The chamber will resume the consideration of Elad L. Roisman to be a member of the SEC. A cloture vote on the nomination is scheduled for 5:30 p.m. today.

Opioids Legislation. Members are putting together a bill to tackle the nation’s opioids crisis. The measure could be taken up as soon as this week.

Key Hearings

Financial Services

  • Sept. 5 – House Financial Services Committee to hold the following subcommittee hearings:
    • The Future of Money: Coins and Banknotes
    • The Cost of Regulation on Affordable Multifamily Development
  • Sept. 6 –  House Financial Services Committee to hold a hearing on GSE reform.
  • Sept. 6 – Senate Banking Committee is expected to hold a hearing to examine outside perspectives on Russia sanctions.


  • Sept. 6 – Joint Economic Committee to hold a hearing to examine the positive economic growth effects of the Tax Cuts and Jobs Act.

Health Care

  • Sept. 5 – House Energy and Commerce Committee to hold a subcommittee hearing on “Opportunities to Improve Health Care.”
  • Sept. 5 – House Ways and Means Committee to hold a markup of H.R. 6662, “Empowering Seniors’ Enrollment Decision Act of 2018,” and other related measures.


  • Sept. 5 – Senate HELP Committee to hold a hearing on the impact of zero tariffs on U.S. autoworkers.
  • Sept. 5 – House Ways and Means Committee to hold a markup for H.Res. 1018, “Requesting the President to transmit to the House of Representatives certain documents in the possession of the President relating to the determination to impose certain tariffs and to the strategy of the U.S.  with respect to China.
  • Sept. 5 – Senate Foreign Relations Committee to hold a hearing to examine the China challenge, focusing on security and military developments.
  • Sept. 6 – Senate Appropriations Committee to hold a subcommittee hearing to review the FY 2019 budget for the Bureau of Industry and Security, the International Trade Administration, and the U.S. International Trade Commission.


  • Sept. 5 – Meeting of the conferees to H.R. 2, the 2018 farm bill.


  • Sept. 5 – House Education and the Workforce Committee to hold a subcommittee hearing titled, “On-The-Job: Rebuilding the Workforce Through Apprenticeships.”


  • Sept. 6 – House Committee on Homeland Security to hold a subcommittee hearing on “Understanding Cybersecurity Threats to Americas Aviation Sector.”
  • Sept. 6 – House Committee on Transportation and Infrastructure to hold a hearing on “Airspace Integration of New Aircraft.”
  • Sept. 7 – House Committee on Transportation and Infrastructure to hold a hearing on “Building a 21st Century Infrastructure for America: Water Resources Projects and Policy, Part II.”

The IRS has released guidance related to the 2017 Tax Cuts and Jobs Act amendments to Section 162(m) of the Internal Revenue Code, which generally apply to taxable years beginning or after Jan. 1, 2018.

IRS Notice 2018-68 provides additional guidance around the definition of “covered employee” and the grandfathering rules for arrangements that were in place before Section 162(m) was amended.

Check out McGuireWoods’ analysis of the guidance here.

Hard to believe September is just around the corner. Both chambers of Congress will be back in action after Labor Day. The Take Stock blog team spent the August recess taking care of some housekeeping items for this site. Notice the new banner! Note the new title! We are expanding the blog to cover more than tax and employee benefits topics.

Going forward, the Take Stock blog will include updates and discussions on a variety of legislative and regulatory developments at the federal level, including trade, energy, health care, and financial services. Yes, the blog has been creeping into these policy areas for a while now, but now it’s official – huzzah!

The Senate convenes today at 3 p.m. The House remains in recess and will return Sept. 4.

The Senate will resume consideration of H.R. 6157, the third “minibus” spending package that provides funding for Defense and Labor-HHS-Education. The chamber is expected to vote on a series of amendments to the spending legislation throughout the week. Senate leaders are aiming to take a final vote before Labor Day.

Key Hearings

Tuesday, 8/21

  • Senate Homeland Security and Governmental Affairs. Hearing to examine CMS efforts to fight Medicaid fraud and overpayments.
  • Senate Energy Committee. Hearing to examine the energy efficiency of blockchain and similar technologies and the cybersecurity possibilities of such technologies for energy industry applications.
  • Senate Foreign Relations Committee. Hearing to examine the U.S.-Russia relations.
  • Senate Banking Committee. Hearing to examine Russia sanctions, focusing on current effectiveness and potential for next steps.
  • Senate Judiciary Committee. Hearing to examine cyber threats to our nation’s critical infrastructure.
  • Senate HELP Committee. Haring to examine financial literacy, focusing on the starting point for a secure retirement.

Wednesday, 8/22

  • Senate Finance Committee. Hearing to examine the nominations of Michael Faulkender, of Maryland, to be an Assistant Secretary of the Treasury, and Elizabeth Darling, of Texas, to be Commissioner on Children, Youth, and Families, Department of Health and Human Services.

Thursday, 8/23

  • Senate Banking Committee. Meeting to vote on the nominations of Kathy Kraninger to be the head of the CFPB and Elad Roisman to be a SEC commissioner.

The IRS and Treasury Department recently proposed regulations on new section 199A, the 20 percent deduction for qualified business income. While the new rules address some issues that arose with the enactment of the deduction, a number of questions still remain.

Check out McGuireWoods’ analysis of the new rules here.


The Senate returns Wednesday at noon. Here’s the agenda for the short work week:

Confirmations. The chamber will consider the nominations of Marvin Quattlebaum, Jr. and Julius Ness Richardson to be U.S. circuit judges for the 4th Circuit.

FY 2019 Appropriations. H.R. 6157, the third “minibus” spending package, is expected to hit the floor. The package is expected to include funding for Defense and Labor-HHS-Education.

National Defense Authorization Act (NDAA). The 2019 NDAA will be signed by the president today in Fort Drum, NY. The $717 billion defense reauthorization measure contains a set of provisions to update operations at the Committee on Foreign Investment in the United States (CFIUS), strengthening U.S. export controls and subjecting more joint ventures and other transactions to CFIUS review.

Upcoming Hearings

Aug. 16

  • Senate Commerce Committee to hold an oversight hearing to examine the FCC.

Aug. 21

  • Senate Homeland Security and Governmental Affairs Committee to hold a hearing to examine the CMS’s efforts to fight Medicaid fraud and overpayments.

Sept. 4

  • Senate Judiciary Committee is expected to kick off hearings for the nomination of Brett Kavanaugh to be a justice of the U.S. Supreme Court.