Recent Press Releases

WASHINGTON, DC —  U.S. Senator John Thune, along with 23 Senators, sent a letter today to Department of Treasury Secretary Timothy Geithner to voice concern over the Administration's reported proposal to provide tax breaks for trial lawyers, and request more information on such efforts.

"While families and small businesses across our country struggle to make ends meet in these challenging economic times, the Obama Administration continues to craft backroom deals that favor special interests over the average American," said Thune.

"From health care legislation to the recently-passed financial regulatory reform, Americans have witnessed this Administration and Congressional Democrat leadership cut deals with special interest groups. Instead of providing tax relief for political allies, we ought to be providing across the board tax relief for the average, hardworking taxpayer."

The Treasury Department's reported policy change would allow trial lawyers to deduct expenses and court costs in the year in which they were incurred, which could add up to $1.6 billion to the country's $13 trillion national debt. Current law stipulates that expenses related to ongoing lawsuits can only be deducted in the year in which a case is decided. The letter below was signed by Senators Alexander, Barrasso, Bond, Bunning, Burr, Chambliss, Coburn, Cochran, DeMint, Ensign, Enzi, Gregg, Hatch, Inhofe, Isakson, Kyl, Lugar, McCain, McConnell, Roberts, Vitter, Voinovich, and Wicker.

July 29, 2010

Timothy Geithner
Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington, DC 20220

Dear Secretary Geithner:

We are writing to express our concern about possible Treasury actions to provide a new tax break for trial lawyers and to request more information on this proposed change.

As you may know, a number of recent reports have suggested that the Treasury Department is considering a policy change that would allow trial lawyers to deduct expenses and court costs in the year in which they were incurred. We have serious concerns about this proposal which could add $1.6 billion to our already exploding national debt. We believe that this targeted tax break will do nothing to spur economic growth or job creation. Instead, it would only further provide incentives for contingency fee lawsuits which raise prices for consumers and decrease employment.

We are also very concerned that this proposal may be moving through without any scrutiny. Bills which would have a similar effect have been introduced in both the U.S. House of Representatives and the U.S. Senate. However, neither the Ways and Means Committee nor the Finance Committee has held a hearing on these bills due to the significant opposition that they face. Additionally, this proposal was not mentioned in the Treasury's Department's annual "Green Book."

We respectfully request that you inform us if you are in fact considering this policy change, and if so, when you expect to implement it and what the costs to taxpayers would be. Thank you for your consideration of this request.