The U.S. Supreme Court (SCOTUS) has received scores of briefs on whether it is constitutionally permissible for the United States to tax unrealized income. The briefs are in connection with a case now pending before SCOTUS, Moore v United States, which raises the issue of whether unrealized income can be subject to current tax liability. The case has significant implications for cash value life insurance, and for long-held investments.

Republicans on the House Financial Services Committee approved four anti- environmental/social/governance (ESG) bills this past July, and on September 5, GOP members of the House Education & the Workforce Committee introduced another four bills that would restrict the use of ESG factors in evaluating investments in a retirement savings plan.

The National Flood Insurance Program (NFIP) must be reauthorized and funded before the October 1 start of the new fiscal year (FY).

If Congress does not reauthorize and fund the NFIP by October 1 (whether in a continuing resolution or in a FY 2024 appropriations bill), the agency would not be able to issue new flood insurance policies. Plus, funding would become even more of an issue than it already is. (FEMA, the Federal Emergency Management Agency, is already running low on funds with literally billions in claims from various natural disasters still outstanding.)

On August 29, Treasury/the Internal Revenue Service (IRS) proposed rules expanding tax reporting of cryptocurrency transactions. Generally, the proposed rules would require cryptocurrency exchanges to disclose detailed information on their clients’ transactions starting in 2026.

Legislation has been introduced in both the House and Senate to negate the Department of Labor (DOL) Acting Secretary Julie Su’s ability to lead the agency in the absence of the Senate confirming her nomination.

Congress left Washington on July 27 without enacting any fiscal year (FY) 2024 appropriations bills. Lawmakers did make some progress in both the House and Senate, but face having to do all 12 of the annual discretionary spending bills in less than three weeks in September. Expect deep cuts to the budgets of all the agencies, except the Veterans Administration (VA) and Defense, and potentially new taxes as well.

Employee Benefits Security Administration (EBSA) head Lisa Gomez is predicting changes to the Department of Labor’s (DOL’s) fiduciary rule due to “changes in the marketplace since 1975.” She noted, though, that EBSA is also considering the litigation that has overruled previous attempts by EBSA to change the fiduciary rule, especially in connection with advice on rollovers.

On July 21, the National Conference of Insurance Legislators (NCOIL) adopted a NAIFA-backed resolution to oppose any new fiduciary rule from the U.S. Department of Labor (DOL). The decision came in part as a result of NAIFA testimony highlighting why no change to current fiduciary rules is necessary.

On July 7, the Departments of Labor (DOL), Health and Human Services (HHS), and the Treasury (the “tri-agency” reg) released a proposed regulation that would significantly and adversely impact short-term limited duration (STLD) and fixed payment (e.g., indemnity) health insurance.

The Treasury Department has still not decided whether it will/can delay the effective date of the SECURE 2.0 rule that requires plan participants earning more than $145,000 to make their catch-up contributions on a Roth basis (i.e., after-tax contribution, tax-free withdrawals).

A new Senate bill, S.2512, would permit employers to automatically enroll existing workers (who had initially opted out) into their employer-sponsored retirement plans every three years. The reenrollment would be subject to the worker’s ongoing ability to continue to opt out.

On July 27, Rep. Lloyd Smucker (R-PA), a key member of the tax-writing House Ways & Means Committee, introduced legislation to make permanent the 20 percent deduction for noncorporate business income. The bipartisan bill, H.R.4721, the Main Street Tax Certainty Act, has 99 cosponsors.

Key Democrats in the Senate and the House have introduced legislation to raise the federal minimum wage to $17/hour. The “Raise the Wage Act” was introduced in the Senate on July 25 by Senate Health, Education, Labor, and Pensions (HELP) Committee Chair Sen. Bernie Sanders (I-VT). Senate HELP has jurisdiction over minimum wage issues. The bill was introduced in the House by Education & the Workforce Committee ranking member Rep. Bobby Scott (D-VA). The Education & the Workforce Committee has jurisdiction over the bill in the House.

On July 24, the Internal Revenue Service (IRS) issued a final rule concerning required repayment of overpaid employment tax credits. Generally, the final rule will treat amounts paid by the government that were in excess of the correct amount as amounts that must be repaid as late payments of taxes due, subject to the usual interest and penalties rules.

On July 27, the House Ways & Means Committee’s Subcommittee on Oversight held a hearing on delays in processing employee retention tax credit (ERTC) claims, and on reports of widespread fraudulent claims for the pandemic-era tax credit.

On July 12, the Department of Labor’s (DOL’s) Wage and Hour Division (WHD) sent to the White House (the Office of Management and Budget’s (OMB’s) Office of Information and Regulatory Affairs (OIRA)) for review its proposed changes to the white-collar exemption from overtime (OT) rules. This is the last step prior to finalizing a proposed regulation.

The Government Accountability Office (GAO) is now investigating whether Acting Department of Labor (DOL) Secretary Julie Su has the legal authority to lead the agency. It is becoming increasingly clear that there are not yet the votes to confirm her as DOL Secretary. However, her nomination has not been withdrawn, nor is it scheduled for a Senate vote. Instead, the Administration is saying it has the authority to leave Su in place as Acting Secretary. This is triggering talk of a legal challenge to any actions taken by DOL during what some are calling Su’s illegal time as acting head of the agency.

The Biden Administration has released proposed regulations on short-term limited duration (STLD) health insurance, and on indemnity health insurance that pays benefits based on a triggering illness/injury rather than on a specific service. The Administration also issued a request for information (RFI) on certain medical payment products.

On June 21, the House of Representatives approved legislation, H.R.3801, that would streamline the Affordable Care Act (ACA) required reporting. The Employer Reporting Improvement Act, sponsored by Reps. Adrian Smith (R-NE) and Mike Thompson (D-CA), passed by voice vote under suspension of the rules.

The National Labor Relations Board (NLRB) decided a case on June 13 that revives the agency’s worker classification standard from 2014; i.e., that entrepreneurial activity is but one of ten factors used to determine whether the employer controls the worker/work product, and therefore the worker should be classified as an employee. Prior to this new case, the standard, laid out in SuperShuttle DFW, Inc., made entrepreneurial activity a key factor through which other factors should be viewed.