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House signs off on border security bills as elections draw near. The US House of Representatives has passed three bills designed to better secure the US border, overcoming objections by some Democrats who claim that the Republican leadership brought the measures to the floor to score political points before the congressional elections in November. If approved by the Senate, President Bush is expected to sign the three bills into law. House Republicans praised the passage of the bills. "House Republicans are acting to address America's border security crisis because it is an important matter of national security. Before we can address any other immigration issues, Congress must ensure that we are providing for security along our borders," House Speaker Dennis Hastert commented following approval of the legislation. Democratic Whip Steny Hoyer of Maryland countered, "If the Republican leaders were serious about border security, they would sit down with Democrats and seek, on a bipartisan basis, to enact real comprehensive immigration reform that would beef up security along our borders." House. The bills are part of a series of proposals House leaders intend to enact in response to the impasse between the House and Senate on comprehensive immigration reform. Each chamber has passed broad immigration bills, but House Republicans oppose guest worker provisions contained in the Senate bill and have opted to focus on narrow enforcement measures. Despite these underlying political tensions, the House unanimously approved the Border Tunnel Protection Act (H.R. 4830) by a 422-0 vote on September 21, 2006. The bill would criminalize the construction or financing of an unauthorized tunnel across the US border. Violators could face up to 20 years in prison. Receiving significantly less support, but still passing, was the Community Protection Act (H.R. 6049) and the Immigration Law Enforcement Act (H.R. 6095). The Community Protection Act would allow the US Department of Homeland Security (DHS) to detain aliens for additional time if they cannot be deported for various reasons and are deemed dangerous. The bill allows DHS to detain and deport criminal aliens and gang members under new rules. The House approved the measure by a 328-95 vote. The Immigration Law Enforcement Act would give local police officer the authority to enforce immigration laws. It would allow the deportation of undocumented Salvadorans who have been allowed to stay in the United States under court asylum orders. The measure passed by a 277-140 vote. Senate. Meanwhile the Senate began debate on the Secure Fence Act (H.R. 6061), which the House approved on September 14. That bill would authorize the building of more than 700 miles of fencing along the southwest border. It would require greater use of cameras, ground sensors and other technologies along the border. The Senate is expected to continue debate on the measure during the week of September 24, the final week Congress is scheduled to be in session before the elections. Leslie Silverman takes office as EEOC Vice Chair. Leslie E. Silverman, a veteran member of the US Equal Employment Opportunity Commission (EEOC), has formally taken office as the EEOC's Vice Chair, the EEOC announced on September 20, 2006. President George W. Bush designated Silverman as Vice Chair earlier this month. She has been serving as an EEOC Commissioner since March 7, 2002. "I am honored to serve in this new role at the EEOC," Vice Chair Silverman said. "I look forward to working with Chair Naomi Earp and the other Commissioners as we face the challenges ahead." EEOC Chair Naomi C. Earp said, "The Commission is fortunate to have such a talented leader. Leslie Silverman's public and private sector experience demonstrates her noteworthy command of, and commitment to, equal employment opportunity. She will make a stellar Vice Chair." The office of EEOC Vice Chair became vacant earlier this month when President Bush elevated then-Vice Chair Earp to Chair. Chair Earp succeeded Cari M. Dominguez, who stepped down at the end of a five-year term. As a member of the Commission, Vice Chair Silverman recently led the EEOC's Systemic Task Force, which examined the EEOC's efforts at combating systemic discrimination. In April 2006, the Commission unanimously adopted the Task Force's major recommendations aimed at improving the EEOC's systemic program. In addition, Vice Chair Silverman has been active in the EEOC's mediation program. In partnership with the American Bar Association, she led an effort to expand and enhance the program. She also is a participant on the Center for Work-Life Policy's "Hidden Brain Drain" Task Force, which focuses on the retention and advancement of women and minority employees. Immediately prior to joining the Commission, Silverman served for five years as Labor Counsel to the Senate Health, Education, Labor and Pensions Committee. From 1990 to 1997, she was an associate specializing in employment law and litigation with Keller and Heckman, a Washington-based law firm. A native of Needham, Massachusetts, Silverman holds a bachelor's degree from the University of Vermont; a Juris Doctor degree from the American University, Washington College of Law in Washington, DC; and a Masters degree With Distinction in labor and employment law from the Georgetown University Law Center in Washington, DC. President to nominate David Palmer as EEOC Commissioner. President George W. Bush has announced his intention to nominate David Palmer, of Maryland, to be a Commissioner of the EEOC for the remainder of a five-year term expiring July 1, 2011. Palmer currently serves as Chief of the Employment Litigation Section of the Civil Rights Division at the Department of Justice (DOJ). He previously served as Acting Special Litigation Counsel in the DOJ's Office of Special Counsel for Immigration Related Unfair Employment Practices. Earlier in his career, Palmer served as a Senior Trial Attorney in the DOJ's Disability Rights Section. Palmer received his bachelor's degree from Columbia University and his JD from Case Western Reserve University. Naomi C. Earp takes office as EEOC Chair. President George W. Bush has designated Naomi Churchill Earp as Chair of the EEOC. Chair Earp, who officially took office on September 1, succeeds Cari M. Dominguez, who stepped down after serving a full five-year term. Between April 2003 and September 1, 2006, Earp served as Vice Chair of EEOC. During that time, she created and launched the EEOC's Youth@Work Initiative, a national education and outreach campaign to promote equal employment opportunity for America's newest generation of workers. To date, the EEOC has held more than 1,600 Youth@Work events nationwide, reaching more than 112,000 students, education professionals, and employers. Prior Experience. Chair Earp brought to the EEOC hands-on leadership and management experience, a strong track record of promoting diversity and expertise in the equal employment opportunity (EEO) field. Her work experience in promoting diversity in EEO includes a series of progressively responsible leadership positions with various federal agencies, including the National Institute of Standards and Technology, the National Institutes of Health, the Federal Deposit Insurance Corporation, and the US Department of Agriculture. She also served as an Attorney Advisor at the EEOC during the mid-1980s. Earp received a bachelor's degree from Norfolk State University, a master's degree from Indiana University (Bloomington), and a Juris Doctor from Catholic University's Columbus School of Law in Washington, DC. She is a member of the Supreme Court Bar and the Pennsylvania Bar. In addition to Chair Earp, the other sitting members of the Commission are Commissioners Leslie E. Silverman, Stuart J. Ishimaru and Christine M. Griffin. The fifth Commissioner seat is currently vacant, but President Bush announced his intention to nominate David Palmer as EEOC Commissioner. The EEOC's General Counsel is Ronald Cooper.
President signs law authorizing public website disclosure of federal spending. President Bush has signed into law that bill that requires the Office of Management and Budget (OMB) to establish and maintain a free, searchable public website that lists all entities receiving federal funds, including the name of each entity, the amount of federal funds the entity has received annually by program and the location of the entity. The database will include all government contracts, loans and grants with the exception of individual transactions below $25,000. The new law requires the OMB to ensure the existence and operation of this website by January 1, 2008. Such a website will significantly improve the Department of Labor’s Office of Federal Contract Compliance Programs’ (OFCCP) ability to determine who is a federal contractor and, thus, establish jurisdiction for government audits of federal contractors, according to remarks made by OFCCP Director Charles James, Sr. to a federal contractor group in August 2006. The bill, S. 2590, was signed into law by the President on September 26, 2006. It was sponsored by Senators Tom Coburn (R-OK) and Barack Obama (D-IL). The Senate approved the measure by unanimous consent on September 7, 2006. The House has passed a similar bill that did not cover contracts. But on September 8, Obama’s office announced that House sponsors had agreed to go along with the Senate-passed measure with some modifications. On September 13, the House passed the compromise bill. President’s statement. “By allowing Americans to Google their tax dollars, this new law will help taxpayers demand greater fiscal discipline. In other words, we’re arming our fellow citizens with the information that will enable them to demand we do a better job -- a better job in the executive branch and better job in the legislative branch,” President Bush said at the signing ceremony. “Information on earmarks will no longer be hidden deep in the pages of a federal budget bill, but just a few clicks away.” Senators’ statement. “This legislation marks a small but important step in the effort to change the culture in Washington, D.C. American taxpayers soon will be equipped with a significant tool that will make it much easier to hold elected officials accountable for the way taxpayer money is spent. The army of bloggers, editorialists and concerned citizens who worked diligently to see this bill pass deserve all the credit and praise today,” Senators Coburn and Obama said in a joint statement released following the signing ceremony. Relation to OFCCP contractor audit selection process. In the past, the OFCCP began its process of selecting contractors for compliance reviews by utilizing a list of contractors who had submitted the EEO-1 Report. Currently, the agency also looks at contracts to schedule audits because not every federal contractor checks the appropriate box on the EEO-1 Report to indicate that it has government contracts. As a result, the OFCCP is largely dependent on the General Services Administration’s Federal Procurement Data System to verify an employer’s status as a federal contractor to establish jurisdiction. However, “the Federal Procurement Data System is not what it is cracked up to be,” OFCCP Director James noted during his remarks at the 24th Annual Industry Liaison Group National Conference in Phoenix, Arizona on August 7, 2006. James also made reference to the Coburn/Obama bill that, at that time, was pending in the Senate and said that the OMB was in the process of creating a website that will be complete in terms of capturing federal dollars, including contracts, grants, and loans. James said that this new website would allow the OFCCP to determine who is a federal contractor with clarity, accuracy and speed. Relation to OFCCP contractor audit selection process. In the past, the OFCCP began its process of selecting contractors for compliance reviews by utilizing a list of contractors who had submitted the EEO-1 Report. Currently, the agency also looks at contracts to schedule audits because not every federal contractor checks the appropriate box on the EEO-1 Report to indicate that it has government contracts. As a result, the OFCCP is largely dependent on the General Services Administration's Federal Procurement Data System to verify an employer's status as a federal contractor to establish jurisdiction. However, "the Federal Procurement Data System is not what it is cracked up to be," OFCCP Director James noted during his remarks at the 24th Annual Industry Liaison Group National Conference in Phoenix, Arizona on August 7, 2006. James also made reference to the Coburn/Obama bill that, at that time, was pending in the Senate and said that the OMB was in the process of creating a website that will be complete in terms of capturing federal dollars, including contracts, grants, and loans. James said that this new website would allow the OFCCP to determine who is a federal contractor with clarity, accuracy and speed. OFCCP eliminates EO Survey requirement for federal contractors. The OFCCP has eliminated the regulatory requirement for federal contractors to file the Equal Opportunity (EO) Survey. Notice of the final rule for this regulatory change was published in the Federal Register on September 8, 2006 (71 FR 53032-53042), and the change became effective as of that date. In the preamble to the final rule, the OFCCP stated that "valuable enforcement resources are misdirected through the use of the EO Survey." Moreover, "the lack of utility of the EO Survey, the contractors' burden of completing the EO Survey, and the burden to OFCCP to collect and process EO Survey data that will yield such a poor targeting system are too significant to justify its continued use." The OFCCP estimates that elimination of the EO Survey will reduce federal contractors' costs by almost $5.5 million per year, and save the agency $356,000 annually in processing costs. Background. On January 20, 2006, the OFCCP published in the Federal Register (71 FR 3374-3379) a Notice of Proposed Rulemaking (NPRM) to remove EO Survey requirement from OFCCP regulations. The public comment period ended on March 28, 2006. The OFCCP received a total of 2,736 comments on the NPRM. Of those, 1,707 comments (62%) supported the proposal to discontinue the EO Survey and 1,029 comments (38%) opposed the proposal. There are no differences between the proposed rule and the final rule. The EO Survey was intended to further the goals of Executive Order 11246. It contained information about personnel activities, compensation and tenure data, and certain information about the contractor's affirmative action program. The OFCCP's recordkeeping rules require contractors to maintain information necessary to complete the EO Survey, although not in the format called for by the survey instrument. In the preamble to the final rule, the OFCCP noted that the EO Survey had three major objectives:
According to the OFCCP, it has carefully analyzed to what extent the EO Survey has achieved these objectives. This analysis included two studies that focused on the predictive ability of the EO Survey. The first study, the Bendick & Eagan Report, analyzed whether the pilot EO Survey results could be used to predict whether a contractor would have findings of non-compliance. This report failed to find a correlation between the predictive variables generated from the EO Survey and determinations of noncompliance. As the report acknowledged, data problems and other methodological issues prevented Bendick & Eagan from conducting a full-scale analysis of the pilot EO Survey's predictive power. The second study, the Abt Report analyzed whether EO Survey data could be used to develop a model to more effectively target those contractors engaging in systemic discrimination. The Abt Report found the model's predictive power to be only slightly better than chance. Based on the results of the studies, review of the comments received regarding the NPRM, and the development of new OFCCP initiatives to accomplish the same objectives of the EO Survey but in different ways, the OFCCP concluded that maintaining the EO Survey had no utility to the agency or federal contractors. In the preamble to the final rule the agency emphasized that "[r]escission of the EO Survey requirement should not be viewed in any way as demonstrating a lack of commitment to equal employment opportunity." US Secretary of Labor announces Drug-Free Work Week. US Secretary of Labor Elaine L. Chao has announced that October 16-22, 2006 will be Drug-Free Work Week. The purpose of Drug-Free Work Week is to educate employers, employees and the general public about the importance of being drug-free as a component of improving workplace safety and health. The campaign will be a collaborative effort between the Department of Labor and members of its Drug-Free Workplace Alliance; however, all employers and employees are encouraged to participate. "Drug-free workplace programs advance worker safety and can be a life-changing resource for workers who have drug or alcohol problems," said Secretary Chao. "Members of the Department's Drug-Free Workplace Alliances understand this and during Drug-Free Work Week will be promoting effective programs focused on detection, deterrence and assistance for workers who need it." Through Drug-Free Work Week, the department and alliance members will conduct various activities to help employers, supervisors and workers understand how to implement effective drug-free workplace programs that focus on detection and deterrence while also offering assistance and support for workers who may have problems with alcohol or drugs. The Drug-Free Workplace Alliance is the Labor Department's first-ever cooperative agreement focusing exclusively on improving worker safety and health in the construction industry through drug-free workplace programs. Led by Working Partners and managed cooperatively with the department's Occupational Safety and Health Administration and Mine Safety and Health Administration, the alliance brings together a range of industry stakeholders to identify effective strategies for improving safety and health through prevention and intervention. It was established in October 2004 with four labor unions and then expanded in July 2006 to include four additional unions and five construction contractor/owner associations. The Department of Labor established the alliance because research shows that construction, along with mining, tops the list of industries whose workers report the highest rates of alcohol and other drug abuse. However, no industry is immune to the hazards alcohol and drug abuse can cause. Employers and employees in all industries can learn more about how they can participate in Drug-Free Work Week and ways they can promote drug-free workplace messages-- during the campaign and throughout the year--by visiting the department's Working Partners website at: www.dol.gov/workingpartners.
EBSA seeks information on whether Interpretive Bulletin 75-9 provides adequate guidance regarding the independence of accountants who audit employee benefit plans. The Employee Benefits Security Administration (EBSA) has issued a notice requesting information from the public concerning the advisability of amending Interpretive Bulletin 75-9 relating to guidelines on independence of accountants retained by employee benefit plans under ERISA §103(a)(3)(A). Unless an exception applies, ERISA requires a plan administrator to retain on behalf of all plan participants an "independent qualified public accountant" to examine the financial statements of the plan and render an opinion as to whether the financial statements and schedules required to be included in the plan's annual report are presented fairly in conformity with generally accepted accounting principles. EBSA seeks to obtain information to assist the Department of Labor in evaluating whether and to what extent Interpretive Bulletin 75-9 provides adequate guidance to meet the needs of plan administrators, other plan fiduciaries, participants and beneficiaries, accountants, and other affected parties on when a qualified public accountant is independent. In order to assist interested parties in responding, the EBSA notice of request for information contains a list of specific questions. Written responses, which must be received on or before December 11, 2006, should be addressed to the Office of Regulations and Interpretations, Employee Benefits Security Administration (EBSA), Room N-5669, US Department of Labor, 200 Constitution Avenue, NW, Washington, DC 20210, Attn: Independence of Accountant RFI (RIN 1210- AB09). Responses also may be submitted electronically to e-ori@dol.gov or by using the Federal eRulemaking Portal http://www.regulations.gov. EBSA will make all responses available to the public on its website at http://www.dol.gov/ebsa. For further information, contact Michael G. Leventhal, Office of Regulations and Interpretations, Employee Benefits Security Administration, US Department of Labor, (202) 693-8523 (not a toll- free number). EBSA Extends Form 5500 Filing Deadline for Those Affected by Hurricane Katrina. EBSA is providing an extension of the deadline for filing Form 5500 series annual returns/reports to October 16, 2006 to filers affected by Hurricane Katrina. This additional reporting relief is being granted to filers in 31 parishes in Louisiana, 48 counties in Mississippi, and 11 counties in Alabama. Prior filing extensions granted by EBSA set the deadline for filing as Aug. 28, 2006. After closely monitoring the effects of Hurricane Katrina in the Gulf region and, due to widespread devastation from the hurricane and subsequent flooding, EBSA, the Internal Revenue Service (IRS), and the Pension Benefit Guaranty Corporation have determined that filers in certain parishes and counties require additional time to prepare and file complete and accurate Form 5500 reports. The new extension for reporting applies to plan administrators, employers and other entities affected by Hurricane Katrina and located in one or more parishes or counties listed in the IRS's notice IR-2006-135, issued Aug. 25, 2006. The extension also applies to firms located outside the affected areas who are unable to obtain the necessary information from service providers, banks or insurance companies whose operations were located in the areas listed in IR-2006-135 and affected by Hurricane Katrina. Form 5500 filers using this extension should check Form 5500, Part I, box D and attach a statement labeled "Form 5500, Box D -- Hurricane Katrina Disaster Relief Extension." Similarly, Form 5500 EZ filers should check Form 5500 EZ, Part I, box B, and attach a statement labeled "Form 5500 EZ, box B -- Hurricane Katrina Disaster Relief Extension." For more information about disaster relief, contact the Federal Emergency Management Agency at 1-800-621-3362 or (202) 621-FEMA, or visit the Internal Revenue Service at www.irs.gov under "Disaster Area Tax Relief." Filers who have additional questions may contact EBSA's EFAST Help Line at 1-866-463-3278.
Form 940 will be much improved for Tax Year 2006. Payroll professionals and business owners filing Form 940 Annual Federal Unemployment (FUTA) Tax Return, for 2006 (due by 1/31/2007) will notice a big difference in the form and instructions. The Internal Revenue Service (IRS) has completely redesigned Form 940 to be more user-friendly, reducing the burden for more than one million filers. Many individuals and organizations have asked the IRS to change Form 940. Taxpayers often struggle to determine which lines to complete and which to skip. In addition, they find it difficult to make computations and to fill in explanations of exempt payments. In May 2004, a team led by the IRS Office of Taxpayer Burden Reduction (TBR) began the process of redesigning Form 940. IRS employment tax experts worked with representatives from other federal and state agencies, gathering input from internal and external stakeholders to create a plain language form that is logical, easy to follow, and compatible with optical scanning. The new Form 940 incorporates the advantages of Form 940-EZ (discontinued for tax year 2006) into a simplified form for all filers. Highlights include:
Advance "vision drafts" of Form 940 and Form 940 Schedule A can be viewed on the " Vision Draft Forms" page of IRS.gov at http://www.irs.gov/businesses/small/article/0,,id=146224,00.html. Please note that these versions are subject to further revision and should not be used for filing. The IRS is committed to reducing unnecessary taxpayer burden and welcomes input from tax and payroll professionals, business owners and the general public on opportunities to make it easier to comply with the tax laws. More information, including a link to Form 13285A, Reducing Tax Burden on America's Taxpayers, can be found on the TBR page of IRS.gov, http://www.irs.gov/businesses/small/content/0,,id=146284,00.html. (SSA/IRS Reporter, A Newsletter for Employers, Fall 2006) 403(b) regulation effective date delayed. The IRS has announced that the general effective date for the regulations regarding section 403(b) arrangements that were proposed in 2004 will be extended. In order to provide employers, employees, insurance carriers and mutual funds involved in section 403(b) arrangements a reasonable advance period before the regulations go into effect, the final regulations generally will not be effective earlier than January 1, 2008. (IRS News Release, IR-2006-136, August 29, 2006) Federal Reserve Board issues final regs on payroll cards. The Federal Reserve Board announced its approval of a final rule to provide that payroll card accounts are covered by the Board's consumer protection regulation governing electronic fund transfers. The final rule grants flexibility to financial institutions that must provide account transaction information to payroll card users. Under the rule, institutions are not required to provide paper periodic statements to consumers if the institution makes account transaction information available by telephone, electronically, and, upon the consumer's request, in writing. The amendments to address payroll card accounts are being made to Regulation E, which implements the Electronic Fund Transfer Act, and to the official staff commentary, which interprets the requirements of Regulation E. The effective date is July 1, 2007. (Federal Reserve Press Release, August 24, 2006) Guidance issued on "tie-breaking" rule for multiple taxpayers claiming qualifying child. The IRS has issued interim guidance under the Code Sec. 152(c)(4) "tie-breaking rule." This rule is used to determine which taxpayer may claim a qualifying child when the child is used by multiple taxpayers to claim (1) head of household filing status (Code Sec. 2(b)), (2) the child and dependent care credit (Code Sec. 21), (3) the child tax credit (Code Sec. 24), (4) the earned income credit (Code Sec. 32), (5) the exclusion from income for dependent care assistance (Code Sec. 129), or (6) the dependency deduction (Code Sec. 151). Notice 2006-86 provides that, unless Code Sec. 152(e) applies, the tie-breaking rule of Code Sec. 152(c)(4) shall apply to these provisions as a group, rather than section-by-section. The child is, therefore, treated as the child of only one taxpayer for all the provisions that employ the Code Sec. 152(c) uniform definition of a qualifying child. An exception exists for those taxpayers to whom Code Sec. 152(e) applies. Under Code Sec. 152(e), a noncustodial parent may claim a child as a qualifying child for purposes of the child tax credit and the dependency deduction only. The custodial parent may then claim the child as a qualifying child for purposes of head of household filing status, the earned income credit, the child and dependent care credit, or the exclusion from income for dependent care assistance. In such case, the child would be the qualifying child of two taxpayers. Code Sec. 152 was amended by the Working Families Tax Relief Act of 2004 (P.L. 108-311), effective for tax years beginning after December 31, 2004. This guidance will apply until regulations reflecting this amendment have been issued and become effective. SOURCE: Notice 2006-86, I.R.B. 2006-41, October 10, 2006.
SEC requests comments on proposed exec comp disclosures. The Securities and Exchange Commission (SEC) has requested additional comments on a proposed extension of the disclosure requirements for executive and director compensation to include compensation disclosure for three additional highly compensated employees. The final rules adopted on July 26, 2006 did not include the proposed disclosure requirement regarding the addition of the total compensation and job description of up to three highly compensated employees who are not executive officers or directors but who earn more than any of the named executive officers. Among other things, the SEC is seeking comments on whether the proposal should be modified to apply only to large accelerated filers. Such filers would be required to disclose the total compensation for the most recent fiscal year and a description of the job position for each of their three most highly compensated employees whose total compensation is greater than any of the named executive officers, whether or not such persons are executive officers. Under this approach, however, employees who have no responsibility for significant policy decisions within either the company, a significant subsidiary or a principal business unit, division, or function, would be excluded from the determination of the three most highly compensated employees and no disclosure regarding them would be required. All submissions should refer to File Number S7-03-06. Comments should be received on or before October 23, 2006 and be transmitted by one of the following methods:
Requests for further information should be directed to Anne Krauskopf, Carolyn Sherman, or Daniel Greenspan, at (202) 551-3500, in the Division of Corporation Finance, US Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549-3010 or, with respect to questions regarding investment companies, Kieran Brown in the Division of Investment Management, at (202) 551-6784. PBGC requests OMB approval of its customer satisfaction information collection. The Pension Benefit Guaranty Corporation (PBGC) is requesting that the Office of Management and Budget (OMB) extend its approval, for a three-year period, of a generic collection of information consisting of customer satisfaction focus groups and surveys. The PBGC uses customer satisfaction focus groups and surveys to find out about the needs and expectations of its customers and assess how well it is meeting those needs and expectations. Written comments should be received by October 5, 2006 and directed to the Office of Information and Regulatory Affairs of the Office of Management and Budget, Attn: Desk Officer for Pension Benefit Guaranty Corporation, Washington, DC 20503. (71 FR 52349, September 5, 2006) IRS final regs disallow deduction of payments used to reacquire corporate stock from ESOPs. The IRS has released final regulations that disallow employer deductions of dividends used to pay for the redemption of employer securities held by an employee stock ownership plan (ESOP) or a related person. The regs address issues that have arisen under the application of stock reacquisition expenses under Code Sec. 162(k) and deductions for dividends paid on employer securities under Code Sec. 404(k). The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA, P.L. 107-16) amended Code Sec. 404(k)(5)(A) to provide that the Treasury Secretary may disallow a deduction under section 404(k) for any dividend the Secretary determines constitutes, in substance, an avoidance or evasion of taxation. In essence, the regulations seek to render impermissible a double deduction for the same dividend.
SSA withdraws notice authorizing telephonic requests for review. Less than one month after announcing that claimants would be permitted to request review of initial decisions by telephone, the Social Security Administration (SSA) has announced that it is withdrawing the notice authorizing such oral requests for review. The SSA explained that the change "would not provide the same protections to the claimant that exist in the current process." The SSA will honor any requests that it received from the date of the prior notice, August 14, 2006, until September 12, 2006, the effective date of the withdrawal. SSA proposes revision of privacy and disclosure rules. The SSA has announced its proposed revision of the privacy and disclosure rules to provide regulatory support for new and existing responsibilities and functions. According to the agency's announcement, the "changes in the regulations will increase Agency efficiency and ensure consistency in the implementation of the Social Security Administration's (SSA) policies and responsibilities under the Privacy Act and the Social Security Act." Background. The last major substantive change to the privacy and disclosure regulations was in 1980. A revision in 1997 duplicated many of the HHS regulations on privacy and merged them with the Social Security Administration's regulations on disclosure and availability of information. However, no substantive changes were made at that time. (See 62 FR 4142, January 29, 1997) What are the proposed changes? The proposed changes reflect the SSA's compliance with technological, legal and legislative changes that have occurred since 1980. They include clarification of the provisions regarding requests for access to information developed by medical sources for Social Security programs, a full description of the existing responsibilities and functions of the Privacy Officer position, establishment of the new senior agency official for privacy as required by the Office of Management and Budget (OMB) and an explanation of the related responsibilities, and implementation of the SSA's new Privacy Impact Assessment process in accordance with the E-Government Act of 2002 (PubLNo 107-347). As required by the OMB, the SSA proposes to require adequate safeguards against inappropriate disclosure of personal information over the Internet, and to revise its procedures on notification of, or access to, medical records on behalf of another person. Among the many changes, as detailed below, proposed rules also would require representatives who receive medical records from the SSA to release those records to the person on whose behalf the request was made or, in the case of a minor, to that person's parent or legal guardian. A brief synopsis of some of the key proposed changes follows:
Comments due by November 13. The SSA is soliciting comments on the proposed amendments. They are due by November 13, 2006. The addresses to which the comments may be sent appear in the notice of proposed rulemaking.
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