WASHINGTON BUREAU — The Senate Judiciary Committee has approved S. 23, a bill that would bar the patenting of tax strategies.
The tax strategy ban provision is in Section 14 of S. 23, the Patent Reform Act bill.
The Judiciary Committee approved the bill Thursday on a bipartisan basis, without creating a written report.
The Financial Planning Association (FPA), Denver, is supporting the bill.
The practice of patenting tax strategies limits taxpayers' ability to use some parts of the tax code and tax code interpretations, and it forces financial professionals to keep tabs on strategy patents as well as changes in tax laws, the FPA says.
Financial professionals must get permission from the tax strategy patent holders or risk the possibility that the patent holders could sue them and their clients, the FPA says.
The practice of patenting a specific strategy "is like a football team laying claim to the 'Hail Mary' and forbidding other teams to use it in their playbook," FPA Executive Director Marvin Tuttle says in a statement.
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