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Happy Monday and welcome to On The Money, your nightly guide to everything affecting your bills, bank account and bottom line. Subscribe here: thehill.com/newsletter-signup.

Todays Big Deal: House Democrats are now hitting the most challenging stretch of their infrastructure push. Well also look at an ethics review at the Federal Reserve and how much of President BidenJoe BidenTrump endorses challenger in Michigan AG race On The Money: Democrats get to the hard part Health Care GOP attorneys general warn of legal battle over Biden's vaccine mandate MOREs relief bill actually made it to American families.

But first, a wholesome Giannis moment.

For The Hill, Im Sylvan Lane. Write me at slane@thehill.com or @SylvanLane. You can reach my colleagues on the Finance team Naomi Jagoda at njagoda@thehill.com or @NJagoda and Aris Folley at afolley@thehill.com or @ArisFolley.

Lets get to it.

Democrats brace for toughest stretch yet with Biden agenda

House Democrats this week wrapped up the bulk of committee work on a $3.5 trillion package of social benefits and climate programs a massive undertaking that advances what would be a legacy-defining domestic agenda for President Biden.

Now the harder part begins.

While 13 separate committees succeeded in drafting, massaging and ultimately approving the portions of the package under their jurisdiction, the process featured plenty of infighting between disparate factions over various provisions differences that have created headaches for Democratic leaders and will need resolving before the legislation hits the floor.

The combination is raising new questions about whether House leaders have the votes to pass the package on the floor with a minuscule majority. And thats all before the looming fight in the evenly split Senate, where Democrats can afford zero defections.

The Hills Mike Lillis and Scott Wong break it down here.

PRESENTED BY WELLS FARGO

D.C. small businesses receive $10M from Wells Fargo

Eddie Lofton of JC Lofton Tailors on U Street is rebuilding his business with a grant from nonprofit LISC D.C.

Wells Fargos Open for Business Fund, a small business recovery effort has donated $10M to nonprofits that support District businesses to date.

LEADING THE DAY

Over $450B in COVID-19 relief funds delivered to families: Treasury

The Treasury Department said in a new report on Thursday that it has delivered over $450 billion to families directly under the $1.9 trillion coronavirus rescue package President Biden signed earlier this year.

Overall, the agency said it has distributed roughly $700 billion out of the $1 trillion it was tasked with managing in programs and tax credits under the presidents American Rescue Plan that was approved by Congress shortly before spring. Aris has more details here.

TAKING STOCK

Federal Reserve officials' stock trading sparks ethics review

Federal Reserve Chairman Jerome Powell has directed officials at the central bank to take a comprehensive look into the ethics rules surrounding permissible financial holdings and activities by senior staff.

A spokesperson confirmed to The Hill on Thursday that Powell issued the directive last week after reports emerged of stock trades made by leaders at the Fed's banks in Dallas and Boston last year.

While both bank presidents said they complied with ethics rules, they later said they would divest their assets to avoid the appearance of any conflict of interest. Heres the full story from Aris.

BIDEN BASHES BIG BIZ

Biden goes after top 1 percent in defending tax hikes

President Biden on Thursday went after big corporations and wealthy Americans while promoting his economic agenda that congressional Democrats are working to get across the finish line.

Let me ask you this, where is it written in that all the tax breaks in the American tax code go to corporations and the very top? I think its enough, Im tired of it, he said in remarks at the White House on the economy.

The president reiterated his calls for big corporations and the wealthy to pay their fair share in taxes, saying it's long overdue.

Im not out to punish anyone, Im a capitalist. If you can make a million or a billion dollars, thats great. God bless you. All Im asking is you pay your fair share, pay your fair share, just like middle class folks do, he said.

The Hills Alex Gangitano takes us there.

A MESSAGE FROM WELLS FARGO

D.C. diner rebuilds with help from nonprofit & Wells Fargo

Flip-It LJ Diner owner Sandra Foote didnt think her Columbia Heights restaurant could survive COVID-19.

Wells Fargos Open for Business Fundprovided a grant to the nonprofit District Bridges, which then helped Sandra cover bills. .

Good to Know

Retail sales rose slightly in August despite soaring cases of COVID-19 and supply chain snags, reversing from a decline in July and beating expectations of another decrease.

Heres what else have our eye on:

Thats it for today. Thanks for reading and check out The Hills Finance page for the latest news and coverage. Well see you tomorrow.

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On The Money: Democrats get to the hard part | TheHill - The Hill

NEWYou can now listen to Fox News articles!

In the next few weeks, Republicans have an opportunity to rebrand the Democrats as Big Government Socialists.

This is the kind of opportunity which may come once in a lifetime.

Every Democratic senator and representative has already voted for the outline of Vermont Independent Sen. Bernie Sanders $3.5 trillion Big Government Socialist bill. No matter what lies they tell back home about being moderates, their names are right there on pages S6237 (Aug. 10) and H4371 (Aug. 24) of the Congressional Record. When it mattered there were no moderate Democrats. The only Democrats serving in Congress were unanimously willing to vote for Big Government Socialism.

The Big Government Socialist brand will isolate the Washington Democrats from their own moderates and from the rest of the country. Faced with this clear betrayal of their values, millions of grassroots Democrats will find themselves having to organize a moderate wing of the Democratic Party (something Bill Clinton tried to do as governor of Arkansas in the 1980s).

SENATE AWAITS RULING ON DEM PLAN TO PASS IMMIGRATION IN RECONCILIATION, CIRCUMVENTING GOP

In a number of upcoming primary elections, there may be moderate Democratic candidates prepared to run against the Big Government Socialist incumbents using the $3.5 trillion bill vote as proof the incumbents need to be replaced.

The polling is clear and devastating for the Big Government Socialist Democrats. Americans in general favor Free Market Capitalism over Big Government Socialism by a huge margin (59 percent to 16 percent). Among swing voters, there is an almost 5:1 advantage for Free Market Capitalism over Big Government Socialism (82 percent to 18 percent).

Perhaps most ominous of all for the Washington Democrats, swing voters already believe by 69 percent to 31 percent that the $3.5 trillion Big Government Socialist bill proves Big Government Socialists now define the Democratic Party.

BUDGET RECONCILIATION: WHAT TO KNOW ABOUT PROCESS USED IN COVID AID FIGHT

If everyone who is opposed to the $3.5 trillion bill uses the term Big Government Socialists, within a few weeks the 50 Senate Democrats and 220 House Democrats who have already voted for the bill will be permanently defined as members of a repudiated value system.

When the detailed version of the $3.5 trillion Sanders bill makes clear its wide range of tax increases and enormous expansion of government into our personal lives, Democrats will have two choices. They could vote "no" to soften their images back home and defeat the bill. Or they could double down, vote "yes," and hope the wave of Pelosi-Schumer-Biden money will overcome the immense voter hostility to Big Government Socialism.

The real test for the next month falls on Republicans and conservatives. Can they have a disciplined focus on defining the $3.5 trillion bill as Big Government Socialism?

DEM-BACKED VOTING BILL FACES LEGAL THREAT FROM 23 STATES: UNNECESSARY BUT ALSO UNCONSTITUTIONAL

Can they communicate nationally in every state and congressional district that the Democratic incumbents have proven they are Big Government Socialists by voting for the $3.5 trillion bill in August?

When facing hostile, distracting questions from leftwing television reporters, can Republicans discipline themselves to constantly point out that the $3.5 trillion bill was written by an avowed socialist and IS Big Government Socialism?

CLICK HERE TO GET THE OPINION NEWSLETTER

When face-to-face with Democratic incumbents, can the Republicans muster the courage and discipline to stick to facts and hammer away that "on this date you voted for a $3.5 trillion Big Government Socialist Bill and that makes you a Big Government Socialist?"

Finally, can Republican Party officials, activists, and candidates focus on communicating that Democrats have become Big Government Socialists and that the old moderate Democratic Party has been replaced by a new radical party?

CLICK HERE TO GET THE FOX NEWS APP

These votes in favor of Big Government Socialism have given Republicans the opportunity of a lifetime to brand the Democratic Party so it becomes a minority for a generation or more.

The test now is on the Republican side and in the conservative movement to see if they can rise to the opportunity.

To read, hear, and watch more of Newts commentary, visit Gingrich360.com.

CLICK HERE TO READ MORE FROM NEWT GINGRICH

Excerpt from:
Newt Gingrich: The rare Republican opportunity to make Democrats own the Socialist brand - Fox News

Theres a growing realization among Democrats that their plans for a $3.5 trillion spending package to reshape the nations social safety net and to tackle climate change will have to be slimmed down because of anxious centrists worried about the 2022 midterms.

Democrats by and large feel confident that President BidenJoe BidenTrump endorses challenger in Michigan AG race On The Money: Democrats get to the hard part Health Care GOP attorneys general warn of legal battle over Biden's vaccine mandate MOREs ambitious human infrastructure agenda has strong public support and that a majority of Americans favor raising taxes on corporations and the wealthy to help pay for it.

But theres also a recognition that moderate Democrats in swing states and districts need to show theyre shaping the emerging reconciliation package.

And a part of that process may be slimming down the package from the $3.5 trillion goal set last month by the Senate- and House-passed budget resolutions.

Most times when you face these situations there have to be some changes made in order to get the votes, especially when here in the [Senate] chamber its tied and only the vice president can break the tie, said former Sen. Kent Conrad (D-N.D.), who presided over the budget reconciliation process in 2009 and 2010 when Democrats passed sweeping health care reform legislation.

You probably will have to shave this back some, he said of the $3.5 trillion proposal outlined in the budget resolutions passed earlier this summer.

I suspect there are going to have to be some changes in order to get the votes to pass it, he added. Biden has himself said that these things should be paid for. He said that very clearly and he said it repeatedly.

The closer you get to actually paying for it, the better the chance you have of getting the votes.

Some centrist Democratic strategists are already warning that the size of the human infrastructure bill needs to be substantially curtailed to avoid a political disaster in the 2022 midterm elections.

Youve got all these Democrats in the center who are quietly saying I dont want to support $3.5 trillion because who wants to run on that given the current climate? Have you seen some of the recent polls coming out of the states? said one strategist.

By battling with progressives over the size of the package, moderates can insulate themselves from Republican claims that their party has been taken over by the far left.

Another factor is Bidens declining approval rating.

A Reuters/Ipsos tracking poll Friday showed Biden with a 47 percent national approval rating and a 46 percent national disapproval rate.

A Civiqs tracking poll this week showed Bidens approval ratings in several battleground states Arizona, Florida, Georgia and North Carolina trailing his disapproval ratings by 10 points to 14 points.

Two of the toughest Democratic votes to corral in the Senate belong to Sens. Joe ManchinJoe ManchinBriahna Joy Gray: Push toward major social spending amid pandemic was 'short-lived' Overnight Energy & Environment Presented by Climate Power Emissions heading toward pre-pandemic levels Biden discusses agenda with Schumer, Pelosi ahead of pivotal week MORE (W.Va.) and Kyrsten SinemaKyrsten SinemaOvernight Energy & Environment Presented by Climate Power Emissions heading toward pre-pandemic levels Biden discusses agenda with Schumer, Pelosi ahead of pivotal week Biden goes after top 1 percent in defending tax hikes MORE (Ariz.), who have both said in recent weeks, they will not support a $3.5 trillion package.

Moderate Democrats in the House such as Rep. Stephanie MurphyStephanie MurphyDemocrats brace for toughest stretch yet with Biden agenda The Hill's Morning Report - Presented by National Industries for the Blind - What do Manchin and Sinema want? Democrats hope Biden can flip Manchin and Sinema MORE (D-Fla.) are also threatening to vote "no."

Former Rep. Ron Klink (Pa.), a centrist Democrat who represented a Republican-leaning district in western Pennsylvania, says there are other moderate Democratic lawmakers besides Manchin and Sinema who are balking at the $3.5 trillion price tag.

Theyre going to go back and forth, he predicted about the upcoming negotiations over the size of the package. There are other senators, too, that are just saying, wait, this is too much, this is too big.

Klink, however, is urging jittery Democrats not to run away from Bidens infrastructure agenda.

He warns that ducking for political cover was a fatal mistake made by moderates during the 2009 debate over the Affordable Care Act, which was followed by a landslide Republican victory in the 2010 midterm elections.

You have to sell your constituents on what it is that youre doing and why youre doing what youre doing, he said.

Faced with mounting Republican criticism over tax increases that will be part of the reconciliation package, the White House is emphasizing the benefits for the middle class, stressingits desire to enact tax cuts for daycare, health care and working families with children.

Klink said Democrats also need to make the case that floods, drought and fires that have devastated the nation show the pressing need for more infrastructure investment.

But Klink acknowledges its a safe bet the total size of the spending bill will fall below $3.5 trillion, though likely not as low as the $1.5 trillion or $2 trillion goal that Manchin has floated as alternatives.

I dont think it will be $3.5 trillion but I think it will be much closer to that than $1.5 trillion, he said.

House Ways and Means Committee Chairman Richard NealRichard Edmund NealWant a clean energy future? Look to the tax code Democrats brace for toughest stretch yet with Biden agenda The Hill's Morning Report - Presented by National Industries for the Blind - What do Manchin and Sinema want? MORE (D-Mass.) made an important disclosure Thursday evening when he told reporters that the revenue-raising package coming out his committee will raise well less than what is needed to fully offset Democratic leaders official $3.5 trillion spending goal.

Asked if his package of revenue raisers would reach $3.5 trillion, Neal quickly replied: Oh, no, no. No, thats not at the moment what were talking about.

Speaker Nancy PelosiNancy PelosiOn The Money: Democrats get to the hard part Biden discusses agenda with Schumer, Pelosi ahead of pivotal week Stefanik in ad says Democrats want 'permanent election insurrection' MORE (D-Calif.) on Wednesday tacitly acknowledged the final package is likely to come in under $3.5 trillion by characterizing that number as a ceiling.

I dont know what the number will be. We are marking at $3.5 trillion. Were not going above that, she told reporters.

Some Democrats now say it was inevitable that the $3.5 trillion number was going to slip, even though it already represents a major concession by Senate Budget Committee Chairman Bernie SandersBernie SandersBriahna Joy Gray: Push toward major social spending amid pandemic was 'short-lived' Sanders 'disappointed' in House panel's vote on drug prices Manchin keeps Washington guessing on what he wants MORE (I-Vt.) and other progressives, who initially pushed for a $6 trillion budget reconciliation spending target.

I dont know what the final numbers going to be. I always felt it was going to be less than $3.5 [trillion,] said Jim Kessler, executive vice president for policy at Third Way, a centrist Democratic think tank, and a former aide to Senate Majority Leader Charles SchumerChuck SchumerBiden discusses agenda with Schumer, Pelosi ahead of pivotal week CEOs urge Congress to raise debt limit or risk 'avoidable crisis' If .5 trillion 'infrastructure' bill fails, it's bye-bye for an increasingly unpopular Biden MORE (D-N.Y.).

But Kessler argued that the top-line revenue number that Neal says he will unveil this weekend wont necessarily constrain the size of the reconciliation package.

The budget reconciliation instructions, the budget resolution, basically says Ways and Means has to raise enough money to pay for what Ways and Means is going to spend, he said, pointing out that offsets can come from other committees.

Even so, the House Ways and Means Committee and the Senate Finance Committee are Congresss two tax-writing committees and are expected to come up with the bulk ofwaysto pay for items in the reconciliation package.

Frank Clemente, the executive director for Americans for Tax Fairness, raised concerns earlier this week that the House tax reform bill will wind up raising far less than whats needed to offset the $3.5 trillion spending goal.

Based on my back of the envelope estimates of what's been reported that House Democratsare considering, their revenue target is much too conservative, he told The Hill.

See the original post here:
Democrats see $3.5T spending goal is slipping away | TheHill - The Hill

California Governor Gavin Newsom, a Democrat, warned Wednesday that his party needs to "lean in" on COVID-19 prevention, despite hardline opposition. Speaking with CBS News chief Washington correspondent Major Garrett less than 24 hours after he overwhelmingly survived a recall challenge, Newsom said he views the victory as a sign that his constituents approve of his handling of the pandemic.

"So, what I'm saying here is, be affirmative," Newsom said he would tell national Democrats. "Don't be timid. Lean in. Because at the end of the day, it's not just about formal authority of setting the tone and tenor on masks on vaccines and masks. But it's the moral authority that we have: that we're on the right side of history and we're doing the right thing to save people's lives."

Newsom acknowledged that the recall effort was launched "in no small degree because of our approach to this pandemic."

California has been one of the hardest-hit states during the pandemic, prompting Newsom to adopt some of the strictest COVID-19measures in the country. Conservative talk show host Larry Elder, who emerged as the frontrunner in the crowded field looking to supplant Newsom, made opposition to vaccine and mask mandates a cornerstone of his campaign. Several other Republicans vying to replace Newsom also voiced opposition to COVID-19 vaccine and mask mandates.

But Newsom told CBS News that Democrats need to "stiffen our spines and lean in to keeping people safe and healthy," adding that he feels the "off the charts" turnout proved that people were "motivated, because they understood what was at stake."

Although Newsom has faced six prior recall attempts, this was the first to garner enough signatures to make it to the ballot. The effort gained momentum after Newsom was photographed at the upscale Napa Valleyrestaurant The French Laundry dining indoors with dozens of others while his indoor dining shutdowns were still in effect.

For more of Major Garrett's interview with Governor Gavin Newsom, watch "CBS Mornings" on Thursday, September 16.

View post:
Governor Gavin Newsom to national Democrats: "Don't be timid" on COVID-19 response - CBS News

Democrats are proposing a number of tax reforms related to retirement accounts, including the elimination of backdoor Roth IRA conversions for the wealthiest Americans.

Congressional Democrats want to slam shut a tax loophole known as the backdoor Roth IRA. In one of several proposed changes that target the retirement accounts of wealthy Americans, Democrats on the House Ways and Means Committee want to prohibit people who make more than $400,000 per year from converting pre-tax retirement savings accounts into a Roth IRA. The proposed reforms are part of the Democratic push to raise taxes on the wealthiest to fund a $3.5 trillion spending plan.

A financial advisor can help you make sense of potential law changes in Washington and how they might affect you. Find an advisor now.

Backdoor Roth IRA Conversions Definition and Elimination Proposals

Democrats are proposing a number of tax reforms related to retirement accounts, including the elimination of backdoor Roth IRA conversions for the wealthiest Americans.

Under current tax law, individuals making more $140,000 per year are barred from contributing to a Roth IRA, where retirement savings grow tax-free. However, since 2010, workers who exceed this income threshold have been permitted to convert their pre-tax contributions into a Roth IRA. After paying income taxes on the initial contributions and gains, their retirement savings grow tax-free and will no longer be subject to required minimum distributions (RMDs).

These backdoor Roth conversions, which have grown in popularity, allow high-income earners to sidestep the income requirements on Roth IRAs and capitalize on the tax-free growth these types of accounts offer.

But the use of this strategy could be coming to an end. Democrats on the House Ways and Means proposal, want to prohibit Roth conversions for people making more than $400,000 per year. If approved, the rule change would apply to distributions, transfers, and contributions made in taxable years beginning after Dec. 31, 2031.

The proposed legislation also seeks to eliminate mega backdoor Roths, a sophisticated strategy that allows people enrolled in certain retirement plans to save up to $38,500 in extra after-tax contributions for retirement. If approved, the provision that targets mega backdoor Roth conversions would take effect after Dec. 31, 2021.

Story continues

New Limitations on IRA Contributions

Democrats also want to prohibit high-income taxpayers from amassing tax-deferred fortunes inside retirement accounts. To do so, they plan to restrict people above specific income thresholds from continuing to contribute to Roth and traditional IRAs if they already have $10 million saved in IRAs or other defined contribution retirement accounts. Under current law, taxpayers can contribute to IRAs regardless of how much they already have saved.

The proposed limit on contributions would apply to single or married taxpayers who file separately and make more than $400,000, married taxpayers filing jointly with taxable income greater than $450,000 and heads of households who make more than $425,000.

The proposed crackdown comes as the retirement accounts of the wealthiest Americans continue to swell. According to the Government Accountability Office, 9,000 taxpayers had at least $5 million saved in IRAs in 2011. Eight years later, that number had more than tripled to over 28,000, data from the Joint Committee on Taxation shows.

Under this leg of the Democratic proposal, employer-sponsored defined contribution plans would also be required to report balances of over $2.5 million to both the Internal Revenue Service and to the plan participant whose balance exceeds $2.5 million.

Minimum Distribution Required for Accounts Exceeding $10 Million

Democrats are proposing a number of tax reforms related to retirement accounts, including the elimination of backdoor Roth IRA conversions for the wealthiest Americans.

Democrats also propose that high-income earners with more than $10 million saved in retirement accounts must take minimum distributions from those accounts.

If an individuals combined traditional IRA, Roth IRA and defined contribution retirement account balances generally exceed $10 million at the end of a taxable year, a minimum distribution would be required for the following year, the proposal reads.

Under the legislation, the IRS would require high-income earners with more than $10 million saved in retirement accounts to take a distribution equal to 50% of their savings that exceed the $10 million threshold. For example, if Joan has $12 million in her 401(k) and various IRAs, she would be required to take a $1 million distribution the following year.

The income thresholds would be identical to those from the proposal aiming to curb IRA contributions for the wealthy. If approved, both provisions would take effect after Dec. 31, 2021.

Bottom Line

Big changes could be coming to the retirement accounts of wealthy Americans. Democrats on the House Ways and Means Committee want to eliminate backdoor Roth IRA conversions, prohibit high-income earners with over $10 million in retirement accounts from contributing to their IRAs and mandate that certain high-income earners with massive retirement savings take annual distributions.

Retirement Planning Tips

Will you have enough money to retire comfortably? SmartAssets free 401(k) Calculator can help you determine whether youre on track to retire on time.

Thinking of rolling over a 401(k) or executing a Roth IRA conversion? A financial advisor can help. Finding a financial advisor doesnt have to be hard. SmartAssets free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If youre ready to find an advisor who can help you achieve your financial goals, get started now.

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The post Democrats Want to End This Lucrative Retirement Account Loophole appeared first on SmartAsset Blog.

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Democrats Want to End This Lucrative Retirement Account Loophole - Yahoo Finance