Since my first days in Congress, I have been fighting to make our tax laws fairer for all Nevadans. I have led the fight to provide tax relief for working families, reinstate the state sales tax deduction, and reform the IRS. In today's difficult economic climate, I understand how important it is to ensure tax relief is focused on providing help to hard-working families, and to encouraging investment and job creation.
Tax Relief for Working Families
Protecting Nevada’s middle-class families is one of my top priorities, which is why I have long supported broad-based tax cuts that lower the tax burden for working families throughout Nevada, such as the $1000 per child tax credit, relief from the marriage penalty, and the 10 percent tax bracket. Recently, I led the Senate in passing the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010. This important legislation will cut taxes for middle class families and small businesses, extend unemployment benefits, and create jobs.
This bill is not perfect, but it provides the economic boost middle-class families and small businesses in Nevada and across America need. Absent this agreement, all Americans would have had their taxes increase. The benefits for working families in this legislation include lower tax rates on the income they earn, extension of the $1,000 child tax credit, marriage penalty relief, and tax credits for college expenses. Just as important, the legislation reauthorizes extended unemployment benefits for 13 months and contains job-creating tax incentives including a payroll tax cut for individuals and incentives to create clean energy jobs, energy efficient homes, and investments in renewable energy.
The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 contains a number of provisions that benefit Nevada’s middle class families:
- Extends by two years the current tax rates for middle class families.
- Includes a $112 billion payroll tax reduction for workers for 2011, increasing the average Nevada workers take-home pay by $800.
- Extends unemployment insurance benefits for 13 months, providing a safety net that Nevadans need while they look for work.
- Extends the American Opportunity Tax Credit (college tuition), the Child Tax Credit and the Earned Income Tax Credit.
- Allows businesses to deduct 100% of certain investments in the first year.
- Extends for two years the state and local sales tax deduction.
- Extends Alternative Minimum Tax relief for two years.
- Extends incentives that have been important for Nevada’s developing clean energy industry.
Tax Relief for Small Businesses
Throughout my time in Congress, I have advocated for legislation to cut taxes for small businesses. Recently, I championed the Small Business Jobs Act. This important legislation not only creates the economic environment small businesses need to weather this storm; it also includes incentives that will help them grow and put Nevadans back to work. By giving small businesses some $15 billion in immediate tax relief, incentivizing small business lending, and promoting entrepreneurship, the Small Business Jobs Act is projected to create as many as 500,000 new jobs.
Back in 2009, I insisted that the American Recovery and Reinvestment Act (Recovery Act) contained a number of provisions to ease the tax burden on small businesses, expand the net operating loss carryback, and eliminate the tax penalty when businesses restructure their debt. And as part of the Affordable Care Act, small businesses are eligible for tax credits equal to as much as 50% of the cost of the health care they provide to their employees.
Helping Families Realize and Retain the Dream of Homeownership
As part of the American Recovery and Reinvestment Act (Recovery Act), Congress created the Homebuyer Tax Credit to help increase the demand for homes and encourage borrowers to invest in the housing market. It is clear that these credits have helped stimulate the housing market. That is why I was pleased to extend the $8,000 first-time homebuyer credit to homes purchased through June 30, 2010 and expand it beyond first-time homebuyers to those who have owned a home for at least five of the previous eight years. I also led efforts to eliminate the income tax penalty for homeowners who are successful in negotiating a lower mortgage with their lender.
For more information on my fight to stop foreclosures and keep Nevadans in their homes, please click here.
Protecting the State Sales Tax Deduction
Because Nevadans pay no state income tax, citizens in our state can elect to deduct the sales taxes they pay in computing their federal income tax liabilities. While I believe this important tax deduction for Nevadans should be made permanent, and have cosponsored legislation (S. 143) that would do just that. I was pleased that the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 included a two year extension of the sales tax deduction through 2011. I will do everything I can to make this deduction permanent, so that our tax laws treat Nevada’s families fairly.
Reforming the IRS
Throughout my time in Congress, I have led the fight to reform the IRS to make the agency more responsive to the needs of Nevada taxpayers. In fact, my first speech in the Senate in 1987 was about the need to provide taxpayers with greater protections.
I was a strong champion of the original Taxpayers' Bill of Rights, a law that guarantees a taxpayer’s right to have an attorney represent his or her before the IRS, prohibits the IRS from using quotas for audits or property seizures, and allows taxpayers to recover financial damages caused by the IRS. Most important, the law requires the IRS to explain to taxpayers, in plain English, these and all the other rights to which they are entitled.
While the original Taxpayers Bill of Rights sent a strong message to many IRS officials, further reform was necessary. As such, I supported the Taxpayers' Bill of Rights II, which created the Office of Taxpayer Advocate to assist taxpayers in resolving problems with the IRS. Later, I joined Senators Bob Kerrey (D-NE) and Charles Grassley (R-IA) to pass the IRS Restructuring and Reform Act. This comprehensive law revamped the management and oversight of the IRS to improve its operations and make the agency more accountable to American taxpayers.
If you have specific questions about your tax obligations, I would encourage you to reference the IRS website at IRS.gov for publications and other information. If you would like to contact your local IRS office, you may do so at:
Las Vegas Reno
110 City Parkway 200 S. Virginia St.
Las Vegas, NV 89106 Reno, NV 89501
(702) 868-5005 (775) 824-2218
Additionally, you may want to consider contacting the Taxpayer Advocate Service. This agency operates independently within the IRS and offers free, independent, and confidential tax assistance to taxpayers unable to resolve their tax problems through normal channels or individuals experiencing a hardship. The service helps individual and business taxpayers resolve problems with the IRS. Visit their website for more information or call (702) 868-5179.