MIL USHOR-2b Engine

Source: United States House of Representatives – Representative Don Beyer (D-VA)

U.S. Representatives Don Beyer (D-VA), Lloyd Doggett (D-TX), Linda Sanchez (D-CA), Judy Chu (D-CA), and Brad Schneider (D-IL), all of whom serve on the House Committee on Ways and Means, yesterday wrote to the Internal Revenue Service (IRS) requesting clarity on IRS guidance for the “no tax on tips” provision of H.R. 1, the “One Big Beautiful Bill Act,” tax legislation enacted last year by Republicans in Congress and President Trump. Their letter was submitted as an official comment on the rulemaking proposed by IRS and the Treasury Department for the federal register.

The Members inquired about how the provision would apply “when a government official has previously received cash payments in anticipation of future favors (e.g., government contracts).” They wrote:

“This letter seeks clarification regarding the application of selected proposed rules that would define qualified tips…

…

“There is an open question regarding the application of the tips deduction when a government official has previously received cash payments in anticipation of future favors (e.g., government contracts). The first question is whether such payments are customarily tips.

…
“Consider these factors in the case of a man who is broadly expected to become a high-ranking political official. This man is given a bag full of cash by a businessman who hopes to win future government contracts… The proposed regulations would exclude from qualified tips, ‘[a]ny amount received for a service the performance of which is a felony or -misdemeanor under applicable law is not a qualified tip.’ The statute makes no mention of distinguishing legal from illegal activity, and the final regulations should explain the authority for this distinction. Congress made no indication that payments for illegal activities should be excluded from the tips rule.

“This comment requests an example as follows: A political operative is a clear front runner for a high-level political job within the next six months. He is given $50,000 in cash in a bag in a parking lot, after a lunch discussing hopes that the payor will receive government contracts if the operative is put in a place of power. There is no guarantee of any service or result. Under these circumstances, the payment [is/is not] illegal and [is/is not] a qualified tip. [Describe treatment under OBBBA tips provision.]

“In crafting this example, and in the interest of additional clarity, the final regulations should further explain whether and when a payment like this is illegal.”

A signed copy of the letter is available here, and full text follows below.

***

The Honorable Kenneth J. Kies Assistant Secretary of the Treasury, Tax Policy Department of the Treasury 1500 Pennsylvania Avenue Washington, DC 20220

Re: Comment on Proposed Regulations Identifying Occupations That Customarily and Regularly Received Tips; Definition of Qualified Tips (RIN 1545-BR63)

This letter seeks clarification regarding the application of selected proposed rules that would define qualified tips, as published in the Federal Register on September 22, 2025. Clarifying the application of the final regulations would be in the interest of ensuring clarity to taxpayers and ensuring that the law is implemented as written by Congress.

Background

On July 4, 2025, President Trump signed Public Law 119-21, 139 Stat. 72 (July 4, 2025), commonly known as the One, Big, Beautiful Bill Act (OBBBA). Section 70201 of OBBBA is titled “No Tax on Tips” and would add a new section 224 to the Internal Revenue Code. The provision does not actually exclude tips from being taxed. Instead, the general structure of the provision is a deduction against income taxes for tips received “by an individual in an occupation which customarily and regularly received tips on or before December 31, 2024.” The provision is limited by adjusted gross income, with phaseouts above the limit. The deduction cannot exceed $25,000. Under this structure, all tips will remain taxable under payroll tax rules. For purposes of this comment, the most important statutory provision is the definition of “Qualified Tips” provided in new Code section 224(d):

(d) Qualified tips.–For purposes of this section–

(1) In general.–The term “qualified tips” means cash tips received by an individual in an occupation which customarily and regularly received tips on or before December 31, 2024, as provided by the Secretary.

(2) Exclusions.–Such term shall not include any amount received by an individual unless–

(A) such amount is paid voluntarily without any consequence in the event of nonpayment, is not the subject of negotiation, and is determined by the payor,

(B) the trade or business in the course of which the individual receives such amount is not a specified service trade or business (as defined in section 199A(d)(2)), and

(C) such other requirements as may be established by the Secretary in regulations or other guidance are satisfied.

For purposes of subparagraph (B), in the case of an individual receiving tips in the trade or business of performing services as an employee, such individual shall be treated as receiving tips in the course of a trade or business which is a specified service trade or business if the trade or business of the employer is a specified service trade or business.

(3) Cash tips.–For purposes of paragraph (1), the term “cash tips” includes tips received from customers that are paid in cash or charged and, in the case of an employee, tips received under any tip-sharing arrangement.

Fact Pattern – Bags of Cash for in Anticipation of Government Contracts

There is an open question regarding the application of the tips deduction when a government official has previously received cash payments in anticipation of future favors (e.g., government contracts). The first question is whether such payments are customarily tips. The proposed regulations adopts definitions that “are consistent with IRS guidance defining tips for FICA and income tax withholding purposes in . . . Rev. Rul. 2012-18.” Rev. Rul, 2012-18  lays out factors to distinguish wages from tips. The following factors lean in favor of categorization as tips:

(1) The payment must be made free from compulsion;

(2) The customer must have the unrestricted right to determine the amount;

(3) The payment should not be the subject of negotiation or dictated by employer policy; and,

(4) Generally, the customer has the right to determine who receives the payment

Consider these factors in the case of a man who is broadly expected to become a high-ranking political official. This man is given a bag full of cash by a businessman who hopes to win future government contracts. In this case, each of the factors laid out in Rev. Rul. 2012-18 is present. But the inquiry does not stop there. The proposed regulations would exclude from qualified tips, “[a]ny amount received for a service the performance of which is a felony or -misdemeanor under applicable law is not a qualified tip.” The statute makes no mention of distinguishing legal from illegal activity, and the final regulations should explain the authority for this distinction. Congress made no indication that payments for illegal activities should be excluded from the tips rule.

This comment requests an example as follows:

A political operative is a clear front runner for a high-level political job within the next six months. He is given $50,000 in cash in a bag in a parking lot, after a lunch discussing hopes that the payor will receive government contracts if the operative is put in a place of power. There is no guarantee of any service or result. Under these circumstances, the payment [is/is not] illegal and [is/is not] a qualified tip. [Describe treatment under OBBBA tips provision.]

In crafting this example, and in the interest of additional clarity, the final regulations should further explain whether and when a payment like this is illegal.

We hope this comment is helpful, and we look forward to studying the final rules.

Source: United States House of Representatives – Congressman Jack Bergman (MI-1)

This week, Rep. Jack Bergman cosponsored the Stop Insider Trading Act, legislation that would prohibit Members of Congress, their spouses, and dependent children from trading individual stocks.

Concerns about stock trading by elected officials have grown in recent years, as multiple academic studies and media investigations have shown that Members of Congress have historically outperformed the broader stock market at rates that raise serious questions about access to nonpublic information.

Rep. Bergman noted, “The American people work hard for every dollar they earn, and they are right to be angry when politicians use insider information to trade stocks and game the system. The Stop Insider Trading Act helps restore trust by making clear that Members of Congress cannot profit from the same information they use to write the laws. This bill is about fairness, accountability, and making sure Washington plays by the same rules as the folks back home.”

The legislation, introduced by Rep. Brian Steil, passed the House Administration Committee today and now heads to the House floor for a vote.

Source: United States House of Representatives – Congressman David G Valadao (CA-21)

WASHINGTON – Today, Congressman David Valadao (CA-22) joined Congressman Josh Harder (CA-09) to introduce the Olive Oil Standards Act. California is the nation’s leading producer of olive oil, and the United States remains one of the largest olive oil markets in the world. Yet despite the growing domestic industry and consumer demand, the U.S. still lacks a uniform, enforceable standard of identity and grade standards for olive oil. This bipartisan bill directs the Food and Drug Administration (FDA) to establish clear identity and grade standards for olive oil to protect consumers from misleading labeling and producers from unfair global marketplace conditions. 

“The Central Valley is one of the nation’s leading regions for olive oil production, and as demand grows, it’s important industry standards can keep up,” said Congressman Valadao. “By establishing identity and grade standards, we can protect consumers from misleading labeling, promote transparency in the marketplace, and ensure a level playing field for our domestic olive oil producers. I’m proud to join my colleagues in introducing this bipartisan solution to bring long-overdue clarity and accountability to the olive oil market.”

“We already have the best olives grown right here in our own backyard, but Valley products are being crowded out in the grocery aisle by fake and fraudulent products. That hurts local businesses and shoppers,” said Rep. Harder. “It’s past time to crack down on misleading products once and for all. This common sense bill gives shoppers the transparency they need to buy local and keep their families healthy.”

“This legislation is a win for U.S. olive oil consumers and farmers,” said Kimberly Houlding, President and CEO of the American Olive Oil Producers Association. “When enacted, it will ensure that what is on the label is in the bottle and that the health benefits and value of extra virgin olive oil are preserved for all.”

The Olive Oil Standards Act would:

• Direct the FDA to establish a national standard of identity for olive oil to clearly define what qualifies as each grade sold in the United States.
• Create uniform grade standards for olive oil and olive-pomace oil, including extra virgin, virgin, refined, and other recognized categories.
• Require the FDA to report back to Congress within 120 days on actions taken to implement these new standards.

Read the full bill here.

###

Source: United States House of Representatives – Congressman Mark Pocan (2nd District of Wisconsin)

WASHINGTON, D.C. – Today, U.S. Representative Mark Pocan (WI-02) and Ilhan Omar (MN-05), co-chairs of the Defense Spending Reduction Caucus, released the following statement after the Pentagon announced it failed its eighth consecutive audit late last month:

“It’s rich that just weeks after the Pentagon failed its eighth consecutive audit, Donald Trump called for boosting the Pentagon’s budget beyond the already unthinkable $1 trillion mark, to an even more outrageous $1.5 trillion. We cannot justify continuing to increase the Pentagon’s budget when the agency cannot even successfully pass a fiscal audit. The lack of accountability and transparency at the Pentagon is simply unacceptable, yet Congress continues to pour more and more taxpayer dollars into the agency each year. No other federal agency would be allowed to operate this way. It’s past time to rein in wasteful spending on ineffective weapons programs, stop rewarding wealthy and powerful defense contractors, and restore fiscal discipline to the Pentagon.”

Every federal department is required to conduct an annual audit; however, it took years for the Pentagon to complete its first one in 2018, and after eight attempts, it still has not passed. 

Source: United States House of Representatives – Congressman Joaquin Castro (20th District of Texas)

---

Source: United States House of Representatives – Congresswoman Dina Titus (1st District of Nevada)

Congresswoman Dina Titus today introduced a resolution in the House demanding that the Trump administration provide all documents and communications relating to its threatened takeover of Greenland, including any plan to use military force to seize the Danish territory.

“We need to know if there is anything behind President Trump’s saber-rattling – whether there are concrete plans to invade a country that has been one of our strongest NATO allies,” Congresswoman Titus said. “Denmark fought with us in Afghanistan, and 44 Danes lost their lives. Is this how we treat our allies?” 

Congresswoman Titus said the takeover of Greenland would be unprecedented and could mean the end of NATO. 

“By levying threats of force against a NATO member, Trump has already broken Article 1 of the North Atlantic Treaty. If he continues down this path, NATO will be dissolved and the strongest, most effective military alliance in history will crumble because Donald Trump wants to play strongman in the hemisphere.” 

The Resolution of Inquiry introduced by Congresswoman Titus directs the President and Secretary of State to turn over documents, communications, plans, analyses, and assessments by the Administration pertaining to the sovereignty and territorial integrity of Denmark and the autonomous governing status of Greenland.

“We have heard Trump bluster about invading Mexico, Colombia, and Cuba,” Congresswoman Titus said. “Congress and the American people need to know whether Greenland is a blueprint for other planned Trump conquests.” 

Source: United States House of Representatives – Congresswoman Norma Torres (35th District of California)

Source: United States House of Representatives – Congresswoman Suzan DelBene (1st District of Washington)

Today, Representatives Suzan DelBene (WA-01), Lois Frankel (FL-22), Kim Schrier, MD (WA-08), Lloyd Doggett (TX-37), Mark Pocan (WI-02), Greg Landsman (OH-01), Ami Bera, MD (CA-06), Rick Larsen (WA-02), Alexandria Ocasio-Cortez (NY-14), and Jan Schakowsky (IL-09), along with 62 colleagues, urged House and Senate leadership to include language that would prohibit the implementation of new prior authorization requirements through artificial intelligence claims review in traditional Medicare in any final Fiscal Year 2026 (FY26) funding agreement.

The Centers for Medicare and Medicaid Services’ (CMS) Wasteful and Inappropriate Service Reduction (WISeR) model began January 1, 2026, in New Jersey, Ohio, Oklahoma, Texas, Arizona, and Washington. The model adds new red tape to traditional Medicare by contracting with private companies that use artificial intelligence to require prior authorization for certain services and treatments, including treatments for chronic pain, Parkinson’s disease, sleep apnea, and wound care.

“While we support innovation, efficiency, and eliminating waste, we are concerned that this pilot will delay care for essential services to treat pain, injuries, and chronic conditions,” the Members wrote in a letter to House and Senate leadership.

Concerns about prior approval are well-documented in Medicare Advantage and other private health plans. Federal watchdogs have found that insurers often deny care that later meets Medicare’s coverage rules, forcing patients and providers to navigate appeals, paperwork, and delays before care can move forward.

“These denials delay patient access to care while creating unnecessary administrative burdens for providers,” the lawmakers added.

Last August, DelBene and 16 other colleagues raised similar concerns directly with CMS and requested details about how the model would be carried out and how patients would be protected from delayed or denied care. CMS did not respond and has since moved forward with implementation despite these unresolved concerns. DelBene also introduced legislation to help seniors get the care they need when they need it by reforming prior authorization in Medicare Advantage.

Last September, the House Appropriations Committee unanimously adopted an amendment offered by Frankel to halt the implementation of WISeR in the Labor-HHS funding bill.

The full letter can be found here.

Source: United States House of Representatives – Congresswoman Pramila Jayapal (7th District of Washington)

WASHINGTON, DC — Today, the Monopoly Busters Caucus Chairs U.S. Representatives Pramila Jayapal (WA-07), Chris Deluzio (PA-17), Pat Ryan (NY-18), and Angie Craig (MN-02) are demanding answers from major U.S. oil companies on their role in the Trump Administration’s military operation in Venezuela. 

The Chairs are calling for a full accounting of each oil firm’s involvement in the planning and execution of the U.S. attack and planned occupation of Venezuela. President Trump claimed he briefed oil executives before and after the attack, describing the oil industry as committed to investing at least $100 billion to rebuild the Venezuelan energy sector and asserting that the corporate expansion would receive military backup. 

“Public statements from President Trump suggest a level of pre-planned corporate-military integration that is as deeply troubling as it is legally fraught,” the Chairs wrote. “The claimed alignment between private profit and military force raises serious legal questions about the nature of your firm’s involvement in the operation and the planned occupation.”

The Members note that actions to help facilitate the military expedition or unauthorized negotiations with foreign actors may violate long-standing federal statutes like the Neutrality Act or the Logan Act. The Chairs also highlighted the risk of illegal collusion on Venezuelan ventures given the industry’s history of anticompetitive behavior.

“The American people deserve to know if our military is being used as a private security force for the oil industry,” the Members continued. “Congress has an important oversight and investigative role, and it is incumbent upon us to represent their frustration and concern.”

The oil companies have been given until January 30 to provide written responses and all relevant internal documents with information on:

• Executive Branch Coordination: Details of all meetings and communications with the Executive Branch regarding the military intervention and planned infrastructure development.
• Intelligence Sharing: Any intelligence, technical specifications, or data related to Venezuela that firms provided to the Executive Branch.
• Reimbursement and Assets: Agreements regarding the Venezuelan oil the President intends to personally control or reimbursements for any planned industry investments.
• Legal Risk and Immunity: Internal analysis of legal risks and any promises of legal immunization offered by the Trump Administration.
• Labor and Affordability: Projected impact of potential multi-billion-dollar investments in Venezuela on domestic workforce and energy prices.

The letter was sent to the large U.S. oil companies that reportedly met with the Trump Administration on January 9 at the White House (letters linked): Chevron, ExxonMobil, ConocoPhillips, Continental Resources, Marathon Petroleum Corporation, Valero Energy Corporation, and Halliburton Company.

Issues: Science, Technology, & Antitrust

Source: United States House of Representatives – Representative Sean Casten (IL-06)