Tax Update, 9/25/2013: Preparer regulation has a bad day in court. And the royal consort clarifies the record.

September 25th, 2013 by Joe Kristan


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Bad Day for preparer regulation at appeals court? 
Tax Analysts reports ($link) that the judges hearing the IRS appeal of the D.C. District Court’s shutdown of Doug Shulman’s preparer regulation power grab do not appear inclined to reverse it:

The D.C. Circuit during September 24 oral arguments in Loving v. IRS, No. 13-5061 (D.C. Cir. 2013), expressed skepticism that the IRS possesses the statutory authority to implement its tax return preparer program. Stuart J. Bassin of Baker & Hostetler LLP said that the oral arguments did not go well for the government and that it didn’t appear as if the court was “buying what the government was selling.” 

I’ve heard the same thing from two attorneys who attended the session.  Preparers who have followed the story of selective enforcement of tax laws in the Tea Party scandal can’t relish the idea of giving the IRS more control over their practices.  It looks as though we may be spared that, until and unless Congress does something stupid like authorizing such preparer regulation.

Robert D. Flach has more, as does Kay Bell.  I have joined an amicus brief against the preparer regulations in this case.

 

20130925-1Incentives gone wild.  While Iowa’s state-level politicians love taking your money to lure and subsidize your competitors, the politicians in Coralville have taken it to Detroit-like levels, reports IowaWatchdog.org:

The City Council of Coralville has piled up about $280 million in debt in recent years, the highest debt per capita for a city in Iowa.

The $14,511 burden for each of its 19,219 residents is seven times higher than Des Moines or Iowa City. It’s enough to pay for 38 Iowa Hawkeyes football season tickets or three semesters of tuition at the University of Iowa.

Moody’s Investors Service, after having downgraded the city’s debt four times, was, in a recent report, particularly tough on Coralville’s “history of issuing debt of non-essential government purposes, including the construction of a hotel, golf course, performing arts center and brewery, all of which are city owned.”

All in the name of “economic development,” of course.  Or, as the department store ads used to say, the more you spend, the more you save!  Unless you are one of the unlucky owners of the 60% of property in Coralville that isn’t in a tax-priviliged TIF district.

 

Jason Dinesen, IRS Guidance on FICA Refunds for Same-Sex Married Couples   

Jack Townsend,  Government Refusal to Grant Immunity Shifts Burden of Proof to IRS in Tax Court Case.  But he isn’t sure it will do the taxpayer any good.

 

TaxProf, The IRS Scandal, Day 139

Tony Nitti,  Understanding The Impact Of Legalized Recreational Marijuana On State Tax Revenue   Well, it might not seem to matter so much.

William Perez,  Average Child Tax Credit by State

William McBride,  America Loses another Fortune 500 Company due to High Corporate Taxes (Tax Policy Blog).  A US company, Applie Materials, Inc., acquires a Japanese company, and they move combined headquarters to… Holland:

 The U.S. and Japan have the highest statutory corporate tax rates in the developed world, and by most measures the highest effective corporate tax rates as well. In contrast, the Netherlands has a statutory corporate tax rate of 25 percent, compared to 39 percent in the U.S. and 37 percent in Japan. The Netherlands also has the most generous capital allowances for plant and machinery in the developed world, which is particularly important for these two manufacturing firms. Lastly, unlike the U.S., which taxes foreign earnings on a worldwide basis, the Netherlands uses a territorial tax system, which largely exempts foreign earnings from domestic taxation.

Howard Gleckman, An Upcoming Debate on Whether Private Equity Should Pay Higher Taxes.  (TaxVox) Yes, this country needs nothing more than lower returns to capital.   Just ask the people at Applied Materials.

 

David Brunori, Marriage and Religious Freedom Act Promotes Neither (Tax Analysts Blog):

The tax laws should be neutral when it comes to politics. Personally, I would end all tax exemptions for all political groups — gay, straight, or in between. The IRS rightfully took considerable heat when it singled out conservative groups for scrutiny. But the Marriage and Religious Freedom Act isn’t the answer.

More legislation seldom is, unless it just repeals old legislation.

 

Is there anything tax law can’t do?  Russians Consider Boosting Divorce Tax, Citing ‘Moral And Demographic Decline’ (TaxGrrrl)

 

Tax Justice Blog,  ITEP Analysis: Cuccinelli Tax Plan Mostly Benefits Wealthy Virginians – and Cuccinelli.  When the rich pay most of the taxes, any tax cut will “disproportionately benefit the wealthy.”

Taking a stand: Does the Economy Need Stimulus or Austerity? Yes. (Joseph Thorndike, Tax Analysts Blog)

 

 

20130717-1The Royal Consort clarifies the record.  TBO.com reports that the partner-in-crime of Rashia Wilson, self-proclaimed “Queen of IRS tax fraud,” wants to set the record straight:

He may have been her partner in crime, joining forces to steal millions from federal taxpayers.

He may have spent time at her house and shared “romantic liaisons.”

But Maurice Larry wants people to know he most definitely was not the boyfriend of Rashia Wilson, Tampa’s notorious self-dubbed Queen of Tax Fraud.

Just a good friend with benefits.

Wilson, who became known for her brazen Facebook postings taunting authorities about the millions she was stealing from taxpayers through stolen identity tax refund fraud, was sentenced in July to 21 years in federal prison.

Larry, who spent $100,000 covering a Camaro in chrome, was sentenced Tuesday to 14 1/2 years in federal prison, a sentence he is to serve at the same time as an 8-year, 5-month sentence he received Monday in another tax refund fraud case.

A chrome Camaro?  I suppose it went well with Ms. Wilson’s platinum hairdo.

 

That means they aren’t eating at the right places.  Deloitte Study: Accountants Don’t Have Fire in Their Bellies (Going Concern).

 

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