August 8, 2008
HP-1111

U.S., Malta Sign Income Tax Treaty

Washington, DC--The Treasury Department today announced that U.S. Ambassador to Malta, Molly Bordonaro, and Malta Finance Minister Tonio Fenech have signed a new income tax treaty between the two countries in the Maltese capital of Valletta.

The agreement provides for reduced withholding rates on cross-border dividend payments generally with the elimination of withholding on cross-border dividend payments to pension funds.  It also generally provides for withholding at a 10-percent rate on interest, royalties, and other income.

The treaty also contains a comprehensive limitation of benefits provision and provides for the exchange of information between the competent authorities to facilitate the administration of each country's tax laws. 

The final version of the treaty is attached.

-30-

REPORTS

• U.S.-Malta Income Tax Treaty

August 6, 2008
HP-1110

Treasury, IRS Issue Ruling Preventing Certain Pension Transfers

Agencies Offer Framework for Possible Legislative Change

Washington, DC--The Treasury Department and the Internal Revenue Service today issued Revenue Ruling 2008-45, which states that a transfer of a tax-qualified pension plan from an employer to an unrelated taxpayer when the transfer is not connected with a transfer of significant business assets, operations, or employees, is not permissible under current law. A copy of the ruling is attached.

Accompanying today's ruling, the Administration put forth a framework of principles, as described below, that should guide the development of legislation that could permit such transactions, in circumstances where the transaction is in the best interest of plan participants, their beneficiaries, employers, and the pension insurance system. The legislative framework was developed by the Treasury Department, the Labor Department, the Commerce Department, and the Pension Benefit Guaranty Corporation.

Under the legislative framework, a pension plan (or a portion of a plan) under which benefits are no longer accruing (i.e., a frozen plan) could be transferred to an entity unrelated to the employer (or former employer) of the participants in the plan, provided that certain conditions are met. The conditions would reflect the following fundamental requirements:

• Plan participants, their representatives, and ERISA regulators would be required to receive advance notice of a plan transfer, and the parties to the transaction would be required to provide regulators information necessary to review and approve the proposed transaction.
• Only financially strong entities in well-regulated sectors would be permitted to acquire a pension plan in a plan transfer transaction.
• The parties to the transaction would be required to demonstrate that participants' benefits and the pension insurance system would be exposed to less risk as a result of the transfer, and that the transfer would be in the best interests of the participants and beneficiaries.
• Limitations on transfers would be imposed to limit undue concentration of risk.
• Transferees and members of their controlled groups would assume full responsibility for the liabilities of transferred plans and would comply with post-transaction reporting and fiduciary requirements.
• Subsequent transfer transactions would be subject to the rules applicable to original transfer transactions.

- 30 -

REPORTS

• Revenue Ruling 2008-45

July 11, 2008
HP-1077

WEEK 11 WRAP-UP:
TREASURY SENT 7.530 MILLION STIMULUS PAYMENTS THIS WEEK

This week the Treasury Department sent out 7.530 million economic stimulus payments to American households totaling $5.755 billion.  In total, Treasury has sent out 112.405 million total economic stimulus payments totaling $91.834 billion.

This week marks the final week of mass disbursements of stimulus payments.  Payments will continue to be sent to households in small batches throughout the end of the year as returns are filed by the October 15 extension deadline.  Those Americans who do not file by October 15 and still qualify for a payment can obtain their stimulus payment by filing a 2008 tax return next year.     

Cumulative Total

Total Number of Payments: 112.405 million
Total Amount of Payments: $91.834 billion

Week Eleven (July 7-11)

Total Number of Payments: 7.530 million
Total Amount of Payments: $5.755 billion

Week Ten (June 30-July 4)

Total Number of Payments: 10.025 million
Total Amount of Payments: $7.775 billion

Week Nine (June 23-27)

Total Number of Payments: 9.674 million
Total Amount of Payments: $7.522 billion

Week Eight (June 16-20)

Total Number of Payments: 9.071 million
Total Amount of Payments: $6.919 billion

Week Seven (June 9-13)

Total Number of Payments: 9.526 million
Total Amount of Payments: $7.032 billion

Week Six (June 2-6) 

Total Number of Payments: 9.143 million
Total Amount of Payments: $6.789 billion

Week Five (May 26-30)

Total Number of Payments: 5.757 million
Total Amount of Payments: $4.320 billion

Week Four (May 19-23)

Total Number of Payments: 6.211 million
Total Amount of Payments: $4.927 billion

Week Three (May 12-16)

Total Number of Payments: 15.575 million
Total Amount of Payments: $13.562 billion

Week Two (May 5-9)

Total Number of Payments: 22.180 million
Total Amount of Payments: $20.138 billion

Week One (April 28-May 2)

Total Number of Payments: 7.708 million
Total Amount of Payments: $7.091 billion

Payments began April 28 and will continue via direct deposit or paper check through mid-July.  For a single filer, the minimum payment is generally $300 and the maximum payment is $600.  For joint filers, the minimum is generally $600 and the maximum $1,200.  There is also an additional $300 payment for each qualifying child.   

For tax returns processed by the Internal Revenue Service by April 15 households will receive their payments according to the last two digits of the Social Security number on the tax form.  On a joint return, the first number listed will determine when a stimulus payment will be sent. 

REPORTS

• Direct Deposit Payments