Senate tax reform plan will fuck you..

Colleges, charities, Uber drivers could pay more under Senate tax reform plan

Senate Republicans are considering a number of sure-to-be controversial changes.

By BRIAN FALER

Universities, charities, life insurance companies and others could all lose cherished tax breaks under a Senate plan to rewrite the tax code.

Senate Republicans are considering a number of sure-to-be controversial changes, including imposing a new 2 percent excise tax on the endowment earnings of private universities, according to a summary POLITICO obtained.

They may reduce the tax breaks people receive for fringe benefits at work, such as a deductions for entertainment- and transportation-related expenses. Another proposal, apparently aimed at Silicon Valley firms, would limit write-offs businesses can take for providing meals to employees.

Uber drivers, people who rent their homes through Airbnb and others participating in the "gig economy" could see tougher income reporting requirements that make it harder for them to avoid paying taxes.

Insurance companies could lose a host of tax breaks worth more than $31 billion.

They're all among the potential revenue raisers to cover some of the cost of tax cuts in a still-unreleased tax-rewrite plan Senate Republicans aim to release next Wednesday.

Even as House Republicans race to lock down their tax-rewrite plan, which they hope to move through committee next week, the Senate is working on its own proposal that is likely to differ on a number of issues. Both plans are expected to be far reaching, and certain to be loaded with controversy.

Asked about the list of prospective pay-fors now circulating in the capital, a Finance Committee spokeswoman stressed no final decisions have been made.

“The Senate Finance Committee is busy working on tax reform for American families and job creators,” said Julia Lawless. “It does not have time to focus on ‘lists’ floating around K Street.”

“And, at the end of the day, the only document that matters is the chairman’s mark,” she said, referring to the legislation the committee actually takes up.

The proposed tax on university endowments comes amid criticism, including from President Donald Trump, that colleges enjoy tax-free returns on their investments, even as their tuition charges skyrocket. "Universities get massive tax breaks for their massive endowments," Trump said last year.

The levy under consideration in the Senate would only apply to private universities, not public ones, which is sure to be controversial. Assets "other than those used directly in carrying out the institution's educational purposes" that are "valued at the close of the preceding tax year of at least $100,000 per full-time student" would be subject to the tax, according to a summary of the provision.

The idea has alarmed higher-education advocates.

"We're on red alert," said Steven Bloom, director of government relations at the American Council on Education.

"We think it sets a terrible precedent and reflects a misunderstanding of how endowments work," he said. "Any dollars that would be swept up and go through the federal government through a new mandate on endowments would be fewer dollars those institutions could use toward students."

The tax, expected to raise more than $4 billion, is one of a string of tax changes colleges could face. Republicans may also raise taxes on the royalty income they receive from their logos, reduce the charitable contribution deductions people can take for donating intellectual property, and cut tuition- and housing-related breaks for their employees.

Charities could face a new 25 percent excise tax under the plan on the compensation exceeding $1 million for their five most highly paid employees. Professional sports leagues like the NFL could be stripped of their tax-exempt status.

Meanwhile, people who participate in both 403(b) and 457(b) retirement plans would face lower limits on how much they could squirrel away in the accounts, under the Senate plan.