Retroactive provisons in the Mills Committee recommendations;

              Retroactive Provisions in the Mills Committee Recommendations
By PAUL MESTERN Partner, New York Office
Presented before the Westchester Chapter of The New York Society of Certified Public Accountants — December 1957
INTRODUCTION
During the closing months of the 1957 session of Congress a bill was introduced in the House of Representatives entitled "A bill to amend the Internal Revenue Code of 1954 to correct unintended benefits and hard­ships
and to make technical amendments." It is better known as the Mills Bill because it was introduced by Representative Mills, the Chairman of the Subcommittee of the House Ways and Means Committee which made the recommendations forming the basis for the bill.
About the time the bill was introduced in the House, the Senate became engaged in a lengthy debate on civil rights and there was no chance of getting the bill enacted in 1957. Under the circumstances, the House deferred action and the bill remained on its calendar for 1958.
The bill does not cover such important areas as corporate distributions and adjustments, estates and trusts, or partners and partnerships. These subjects were assigned to special advisory groups and their recommenda­tions
will be the subject for further study by the Committee.
Although the bill may not yet be in its final form, it is important for us to become familiar with the proposals as they stand at the present time. One of the significant features of the bill is the great number of retroactive provisions contained therein. As a matter of fact, the first section states that, unless otherwise expressly provided, all amendments are retroactive to the effective dates or years of the 1954 Code. More than one-half of the 81 sections of the bill are thus to be retroactive to 1954 and many of the remaining sections are to be retroactive to October or November 1956 when the Subcommittee published its first report and held public hearings. Only a few sections are to be effective in 1957 or later, and these will not be covered here.
Whether the delay in the prospective enactment to 1958 will mean that some of the effective dates will be moved forward remains to be seen. In the meantime, careful tax planning must take into account the possi­bility
that many of the retroactive provisions will find their way into the final Act.
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