Speak up Now! The IRS seeks public comment on law: a 3% withholding tax required by all government contractors

Companies that do business with government entities should be aware that in May 2006 both the House and Senate passed the Tax Increase Prevention and Reconciliation Act of 2005, Pub. L. No. 109-222 (TIPRA). Accordingly, the Internal Revenue Service recently posted a notice regarding the new requirement for government entities to withhold three percent on payment for property and services. The IRS is seeking public comment on this notice by April 28, 2008. If implemented, this notice will impact companies with existing government contracts that expire after December 31, 2010. To read Notice 2000-38 visit the IRS website: http://www.irs.gov/govt/fslg/article/0,,id=180377,00.html