Treasury Secretary Janet Yellen assured Senate Finance Committee members in a raucous and wide-ranging hearing that much-needed guidance on energy credits in the Inflation Reduction Act (PL 117-169) is coming soon.
That was good news for taxpayers anxious to take advantage of the tax credits contained in the bill, but the Treasury Secretary found herself more frequently responding to pointed questions regarding the latest banking fiasco.
Yellen’s March 16 appearance before the Committee was purportedly to answer questions regarding President Biden’s 2024 budget proposal, but several lawmakers took the occasion to interrogate the Treasury Secretary with questions regarding the state of the U.S. banking industry following the recent collapse of the Silicon Valley Bank and possibly others.
“I can reassure the members of the committee that our banking system remains sound and that Americans can feel confident that their deposits will be there when they need them,” said Yellen. “This week’s actions demonstrate our resolute commitment to ensure that depositors’ savings remain safe.”
Many Senators did not appear convinced, but others moved on in their line of questioning. Nevada Democrat Catherine Cortez Masto, focused on when to expect Treasury guidance on the solar energy credits and other tax credits in the Inflation Reduction Act. “Everybody’s waiting for guidance for implementation,” she told Yellen, stressing that there was concern over guidance coming too late before taxpayers could implement the opportunities.
Yellen again attempted to reassure lawmakers that her agency was doubling down on producing guidance. “All I can say is we’re working 24/7 on the guidance and regulations that need to be written in order to implement the various tax credits that are in the Inflation Reduction Act.” Moreover, she said the Treasury Department was committed to opening the first phase of applications for that credit in the third quarter of this year, adding, “we will provide detailed guidance ahead of accepting applications.”
South Dakota Republican John Thune, a senior member in Senate Republican leadership, zeroed in on the $80 billion provided to the IRS in the Inflation Reduction Act and when Treasury would come up with a plan for its utilization, a common refrain from many Republicans. Yellen initially told him that it would be ready soon, but Thune pressed her on an exact date. “In a matter of weeks,” she replied.
It was left to Texas Republican John Cornyn, also a member of Senate Republican leadership, to continue the GOP attack on Biden’s budget. “Unfortunately, the President’s budget misses the mark, which is disappointing but unfortunately pretty consistent with what we’ve seen from this Administration,” Cornyn said following a brief deconstruction of the President’s spending provisions.
Ranking Member and Idaho Republican Mike Crapo also addressed the budget in his opening statement. “Secretary Yellen, there are opportunities for the Administration to work across the aisle on commonsense economic policies, but nothing suggests the President is abandoning the partisan tax-and-spend policies of the last two years,” said Crapo. “This Administration must recommit to working with Republicans to develop real solutions that will stabilize the economy and create higher wages and opportunities for American workers.” Crapo later focused his questioning solely on the Administration’s response to the banking crisis.
Get all the latest tax, accounting, audit, and corporate finance news with Checkpoint Edge. Sign up for a free 7-day trial today.