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Martin T. Heinrich
Lawmakers want to outlaw tax deductions for government settlements
Lawmakers want to outlaw tax deductions for government settlements

WASHINGTON -- Two senators introduced legislation Wednesday to outlaw tax deductions by companies for penalties paid as part of government settlements, responding to concerns that JPMorgan Chase & Co. could end up with a huge write-off if it settles civil investigations with the Justice Department over mortgage bonds. Sens. Jack Reed (D-R.I.) and Charles E. Grassley (R-Iowa) said they wanted to close a loophole that allows companies to "reap tax benefits" for payments made to settle allegations of "illegal corporate behavior." “A penalty is supposed to deter others because it causes pain to a company’s bottom line," Reed said. "If a company...

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