Hey, corporations: federal estimated taxes are due for the fourth quarter of 2013 tomorrow, so you will need to set up your EFTPS payment today! Individual fourth-quarter payments are also due tomorrow. Kay Bell explains How to avoid estimated tax penalties.
Misdirected priorities. The Iowa Senate will reliably prevent any worthwhile income tax reform this year, while making a futile effort to increase Iowa’s minimum wage. O. Kay Henderson reports:
Democrats like House Minority Leader Mark Smith of Marshalltown plan to press for an increase in the state’s minimum wage.
“Today, many Iowa parents are working two or three jobs that are low-paying, trying to put food on the table and pay the bills,” Smith said. “…We owe it to Iowa to raise the minimum wage, perhaps a dollar an hour now and more in the future. Our experience in Iowa has shown that raising the minimum wage has little effect on businesses, but gives working Iowans hope for a better future.”
– Only 11.3 percent of workers who would gain from the increase live in households officially defined as poor.
– A whopping 63.2 percent of workers who would gain were second or even third earners living in households with incomes equal to twice the poverty line or more.
– Some 42.3 percent of workers who would gain were second or even third earners who live in households that have incomes equal to three times the poverty line or more.
So a minimum wage boost, even on its own terms, isn’t really there to help the poor. Of course the price of wages can no more be set effectively by decree than any other price. It will result in either job loss, benefit loss, or increased workloads. As one of the studies authors notes:
Because, to the extent they are able, employers will offset the higher minimum wage by reducing non-money components of worker compensation. Burkhauser notes that such an effect will not show up in the government data because the data do not measure these non-money parts of the compensation package. But that is small comfort to those who would find themselves with higher-paying but reduced-benefit jobs.
But because that obvious effect is hard for senators to understand, they’ll just pretend it isn’t there.
Scott Hodge, The U.S. Has More Individually Owned Businesses than Corporations. And they earn more income, too:
That’s why efforts to make “the rich” pay “their fair share” are job killers.
Looking to get Medicaid to pay for Grandma’s nursing home? Be careful. Roger McEowen reports “Iowa Supreme Court Reaffirms Extensive Reach of Medicaid Recovery in Granting Department’s Claim against Irrevocable Trust“:
This case again warns practitioners of the limitations of income-only irrevocable trusts in protecting assets from Medicaid recovery in Iowa. Even if clients are willing to (1) risk the look-back period, (2) pay potential gift taxes, (3) forfeit control of their assets, and (4) deprive their heirs of a stepped-up basis at death, they still may not achieve asset protection.
And really, “free” care isn’t necessarily all that great.
Courts uphold FATCA rules. Court Rejects Banking Associations’ Challenge to Regulations Addressing Offshore Tax Avoidance. (Department of Justice Tax Release) “The regulations require U.S. banks to report to the Internal Revenue Service (IRS) information about accounts earning more than $10 of interest beginning in 2013 that are held by nonresident aliens of all countries with which the United States has a tax treaty or other information exchange agreement.”
Of course not. The IRS Scandal, Day 250: FBI Says No Criminal Charges in IRS Probe. (TaxProf) They didn’t even contact the victims until recently, and they have apparently decided that, with respect to the disclosure of confidential information to ProPublica, the left-side reporting outfit, was just one of those things. I doubt if you or I would get a pass for something like that. That’s what happens when you have a Justice Department that is more a lookout than a watchdog.
Martin Sullivan, Stop Beating on the IRS. (Tax Analysts Blog) I think the IRS gives at least as good as it gets.
So true: The IRS Has Better Things To Do than the RTRP Designation (Russ Fox)
William Perez discusses the Taxpayer Advocate’s 2013 Annual Report to Congress
Jason Dinesen, But Seriously — How Do Taxes Work If You’re Married to More than One Person? Interesting question, but anybody in that situation has more pressing non-tax issues.
Jeremy Scott, Financial Product Reform Might Not Be Imminent (Tax Analysts Blog)
The Critical Question: Should It Bother Us that Boeing Says It Needs a Tax Incentive to Make Its Planes Safe? (Tax Justice Blog). It should bother us that they realistically think legislatures are dumb enough to believe that.
Good luck with that. Monte Jackel Puts Tax Blog Behind Subscriber Firewall, reports the TaxProf, with a $350 annual subscription rate. I am embarrassed to learn of this blog just now, and I wish him luck. Meanwhile the Tax Update subscription rate continues to be $0.00 (except for those wonderful folks who pay a nominal monthly charge to get it delivered to their Kindle). In light of Mr. Jackel’s move, though, I may double that rate.
Tags: Anthony Nitti, IRS disclosure scandal, Jason Dinesen, Jeremy Scott, Kay Bell, Martin Sullivan, minimum wage, Monte Jackel, Russ Fox, Scott Hodge, Tax Analysts Blog, TaxGrrrl, TaxProf, William Perez