Posts Tagged ‘Gene Steurle’

Tax Roundup, 1/5/14: President proposes $1 million Sec. 1031 cap. And: other doomed stuff!

Wednesday, March 5th, 2014 by Joe Kristan
Economic supergenius

0-99, 0-414

The President trotted out his old petty tax increases in his 2015 budget yesterday, and a few new ones.  The  new taxes would go towards, among other spending increases, an increase in the Earned Income Tax Credit welfare program for childless taxpayers.

If history is a guide, the Obama budget isn’t going to do well in Congress.  His own party leadership in the Senate has already pledged to pass no budget at all.  When his 2013 budget plan came up for a vote in Congress, it was rejected 99 -0 in the Senate and 414-0 in the House.

Still, it is worth mentioning some of the tax proposals, just so you are aware of them and their low likelihood of passage anytime soon.  Also, in light of the recent Camp “tax reform” proposal, apparently no tax provision is too dumb to get bipartisan consideration, so some of these might even pass someday.

S corporations: the bill would tax as self-employment income 100% of K-1 income from professional S corporations and partnerships of materially-participating owners.  Businesses covered would include health, law, engineering, architecture, accounting, actuarial science, performing arts, consulting, athletics, investment advice or management, brokerage services, and lobbying.  For some reason, regular compensation would no longer be wages, but would instead be self-employment income.  That would wreak havoc on everybody’s 401(k) and profit-sharing plans.

- Like-kind exchange benefits would be capped at $1 million per taxpayer per year.  That won’t be popular with the real estate industry.

The bill also drags out dozens of the old proposals from his prior budgets, including LIFO repeal, ordinary income treatment for carried interests, capping the value of deductions at 28%, and capping build-ups in retirement plans.  Nothing at all is likely to happen before the next election on these proposals, but as many Obama proposals are also included in some form in the GOP Camp plan, they all have to be considered viable next time a major tax bill shows signs of moving.

The TaxProf has a good link-filled roundup.  The official explanation of the revenue-raisers is here.

Other coverage:

Kay Bell, Obama budget proposes more child care help for younger kids

Leslie Book, President’s Budget Proposes Major Procedural and Administrative Changes (Procedurally Taxing).  ”The popular media has generally described the plan overall the way Reuters did in reporting that it ‘stands little or no chance of being approved as is by Congress, where Republicans, who control the House of Representatives, disagree with the president’s policy priorities.’”

 

Des Moines Register, Voters OK increasing franchise fee in Des Moines.  The vote is the result of the city being ordered to repay an illegally-collected utility tax:

The money raised by increasing the franchise fee to 7.5 percent from 5 percent for seven years will be used to pay off about $40 million in bonds issued by the city to pay for the refund and administrative costs.

Among the “administrative costs” is $7 million in legal fees Des Moines was ordered to pay to the winning taxpayer attorneys after a scorched-earth court battle by the city to avoid repaying the illegal tax.  Next time, don’t collect an illegal tax, and pay up if you’re called on it.

 

Alan Cole, True Marginal Tax Rates under Chairman Camp’s Proposal (Tax Policy Blog).  Full of high-income phase-outs, it creates all sorts of goofy marginal rate anomalies:

Marginal Tax Rates Camp Tax Reform

Note the spike in rates at the low-end as a result of the earned-income tax credit phase-out.  That doesn’t even include the effect of the state EITCs that piggyback on the federal credit.  All of this is the opposite of tax reform.  Apparently neither party is ready for reform.

William Gale and Donald Marron, The Macro Effects of Camp’s Tax Reform (TaxVox): “How would Camp’s plan increase growth, and why is the range of estimates so wide?”

 

Paul Neiffer, Additional Tax Reform Items.  ”Remember, this is just a proposal and nothing will happen this year.”

Gene Steurle, A Camp-ground for Tax Reformers (TaxVox).

 

20130419-1Russ Fox, Deadlines for Us, but Not for Them:

For practitioners, the current state of the IRS is such that you can expect a lot of delays in responding to notices. Think months instead of weeks. Expect to have to call the IRS to verify that your response was received, and make sure clients are aware that the IRS is moving like molasses rolling uphill. Make sure anything you send is documented: certified mail with proof of receipt if by mail; if faxing, make sure you have the proof of receipt. Given the lengthy delays our clients are going to be in fear for far longer…

For taxpayers, you need to be aware that expediency is not part of today’s IRS. You have to be expedient in responding to notices but don’t expect the IRS to be expedient in getting back to you. Do not worry if it takes a long, long time to resolve something with the IRS. That’s just par for the course today.

Unfortunately, clients generally assume that if the IRS has sent a letter, that means the practitioner screwed up.  Many people, especially old folks, just pay up when they get an IRS notice.

 

William Perez, Tax-Deductible Relocation Expenses

TaxGrrrl, Taxes From A To Z (2014): B Is For Basis   

David Brunori, Taxing Coca Cola while Exempting Broccoli is Bad Policy Even for Native Americans (Tax Analysts Blog):

 In any event, several newspapers reported that one of the sponsors of the proposal was himself obese. He decided to change his life and lost 100 pounds. And he did it without any tax increases or help from the government.

Like so many reformed smokers/overeaters/drinkers, he has become annoying about it.

Tax Justice Blog, State News Quick Hits: State Policy Makers Need a Tax History Lesson

 

TaxProf, The IRS Scandal, Day 300.

 

Cheer up!  Filing Your Tax Return Is Terrible — But It Was Worse 100 Years Ago (Joseph Thorndike, Tax Analysts Blog).

News from the Profession.  The Real Loser at the Oscars This Year Was PwC.  (Going Concern)

20140305-1Jason Dinesen shares his Tax Season Tunes:

Here’s a sampling of other tunes I listen to while working when not getting my Gordon Lightfoot fix:

  • Neil Diamond. Generally not his “famous” songs. I detest — and I mean absolutely revile — “Sweet Caroline,” for example. The original recording is okay, but he’s turned it into a hokey, over-the-top, karaoke show-tune over the last few decades. Blech. I like the more introspective songs like “Shilo,” “If You Know What I Mean,” “Stones,” pretty much anything from his relatively new “12 Songs” and “Home Before Dark” albums,  and a host of other Neil Diamond songs that most people have probably never heard of.

  • An mix of songs that include Billy Joel, pop rock from the 60s and early 70s, Elvis, Willie Nelson, Conway Twitty, AC/DC, Juanes, Bon Jovi, CCR, Johnny Cash and Jimmy Buffett.

In case you were wondering, I believe Jason works alone.

 

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Tax Roundup, 2/28/2013: Sequester freak-out edition.

Thursday, February 28th, 2013 by Joe Kristan

20130228-1If Congress fails to act today, automatic spending cuts take effect that drastically reduce government outlays to more than they were last year.  Some commentary:

Gene Steurle, How to Avoid Sequester and Give Both Parties What They Want (TaxVox)

Michael Giberson,  Sequester Reporting Scavenger Hunt: Official Rules (Knowledge Problem): “If you find a news story emphasizing the pain of sequester budget cuts that also clearly indicates that alternatives such as raising taxes or increasing the national debt also cause pain, you are a winner.”

The last refuge of rich scoundrels.  Patriotic Millionaires Slam Congress on the Sequester Stall (press release)

Fire and brimstone coming down from the skies!  Boehner Tells Members They Have to Fly Commercial

Real wrath-of-God stuff.  Potential effects of U.S. cuts on Iowans remain a mystery (Des Moines Register)

 

Kay Bell,  Tax cheating is unacceptable, say most Americans

Joseph Henchman,  Wisconsin Governor Walker Proposes Income Tax Reduction.  He would leave the top rate at 7.75%.  Still too high.  It’s even above Iowa, if you take Iowa’s deduction for federal taxes into account.

Tony Nitti, House Republicans Take First Stab At Killing Off The Tax Code

Dan Meyer,  Another Tax Season, Another Warning: Watch Out for “IRS e-mail” Scams

Russ Fox,  Illinois’ Pension Problems Get Worse; Lottery Checks Bounce

Cara Griffith, Stealth Lobbying (Tax.com)

 

You’re as young as you feel. UBS Client, 78, Charged With Tax Evasion in Illinois Case (Bloomberg.com)

The worst part is, they don’t have PTINs or continuing education.  IRS: Gang members stealing tax returns (ABC-7.com)

 

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Tax Roundup, 2/14/2013: Happy Valentine’s Day! Oh, and tell me more about your illegal tax shelter, honey!

Thursday, February 14th, 2013 by Joe Kristan
Wikipedia image

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The TaxProf Reports: IRS Whistleblower Office Issues Annual Report to Congress.  It looks like ratting out tax cheats could be lucrative.  Changes requiring the IRS to issue more awards were enacted in 2006, and it appears that the whistleblowers have done well.  In 2012, for example, 128 awards were paid totalling $125,355,799, according to the report.  That works out to nearly $1 million each.

Awards may well be one of the most effective ways to enforce the tax law, as well as one of the most creepy.  They make every disaffected employee a potential IRS mole.  Sure, it may make employment awkward for the whistleblower, but $1 million cash can be very consoling.

But before you go racing to the IRS, consider this sobering news from the report: From 2008 through 2012, whistleblowers reported 33,064 cases to the IRS, but awards were paid only 630 times.  That means about 1 in 50 claims cashed out.  Because the IRS collection process is slow, some more of those claims will get paid out, but the great majority won’t.

The moral?  If you have a Valentines Day date, be careful how much of your tax life you share.  Love is one thing, but cold hard cash is something else entirely.

 

I’ll start that diet right after I finish this cheesecake:

Treasury nominee Lew calls tax reform top priority (Reuters)

Obama Proposes Tax Incentives for Manufacturing (Tax Analysts, $link)

If tax reform is a top priority, you don’t start the process by adding more gimmicks to the code.

 

You mean not all appraisals are trustworthy?  Ohio Federal Court Bars  Appraiser of Historic-Preservation Easements. From a Department of Justice press release:

A federal court in Cleveland has barred MAI-designated real estate appraiser Michael Ehrmann and his firm, Jefferson & Lee Appraisals Inc., from preparing property appraisals for federal tax purposes, the Justice Department announced today. Judge Dan Aaron Polster of the U.S. District Court for the Northern District of Ohio signed the civil injunction order against Ehrmann and Jefferson & Lee Appraisals. The defendants consented to the injunction without admitting the allegations against them. 

Federal law allows a taxpayer in certain limited circumstances to claim a charitable deduction for the value of a conservation easement donated to a qualified organization. The easement’s value must be determined by a qualified appraiser. According to the government complaint, Ehrmann’s appraisals repeatedly overstated the value of conservation easements placed on historic properties, including the Book Cadillac Hotel in Detroit and the Powerhouse Building in the Flats District of Cleveland.

The tax law is very touchy about the rules for appraisals.  The obvious potential for abuse shows why.

 

A sad story from Buffalo.  A tax preparer scammed his own clients, reports buffalonews.com:

Elizabeth Wopperer lost everything. She lost her business. She lost $40,000 in cash. And by the time it was all over, she found herself filing for bankruptcy.

On top of all that, the IRS now wants the money that was stolen from her.

The man she blames is going to federal prison for up to 30 months, but that won’t return the cleaning business she was forced to sell or pay the taxes she now owes because of his fraudulent actions.

What happened?

Mangione, the operator of a North Tonawanda payroll and tax preparation business, was supposed to pay federal income taxes on behalf of his clients but didn’t.

He chose instead to pocket some of the money, which means Schunke, Wopperer and several others are still on the hook for those taxes.

There’s no reason to give money to your preparer to pay your taxes.

 

Gene Steurle, Why Tax and Transfer Programs Often Discourage Work and Savings (TaxVox):

 The tax code also is loaded with disincentives to work, save, and study.  They include PEP and Pease (reductions in tax allowances for personal exemptions and itemized deductions), child tax credits, and the earned income tax credit. These implicit taxes combine with explicit taxes to create incentives for many households that are often inefficient and inequitable, to say nothing of strange and anomalous.

That’s why proposals to increase the earned-income credit are pernicious.  The phase-outs of the benefits as incomes rise punish taxpayers for improving their lot.

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But I thought nobody moved because of state taxes! Two Dozen Companies Announce California Departures, Citing Higher Taxes (Joseph Henchman, Tax Policy Blog).

Cara Griffith, Income Redistribution Has No Place in State Tax Systems(Tax.com) The goal of taxes should be to finance operation of the government.  The tax commissioner is not Handicapper General.  When states try to soak the rich, they’ll rinse them right across the state line.

 

Kay Bell, Mistakes on child tax credit form are delaying some returns

Paul Neiffer, Don’t Forget the “Magic Blurb” on Donation Acknowledgements!  A cancelled check by itself doesn’t get you a charitable deduction over $250.

Missouri Tax Guy, Maximize your Travel & Entertainment Benefits.

TaxGrrrl, The Cost Of Health Care Insurance, Taxes and Your W-2

Patrick Temple-West,  Vital New York City property taxes lost, and more (Tax Break)

Andrew Mitchel, 48% Decrease in Number of Expatriates for 2012

Jack Townsend,  Interview of R. J. Ruble, A Tax Lawyer Incarcerated for Tax Shelter Crimes.  Sobering.

 

Say, what time is it?  Madness Time. (Christopher Bergin, Tax.com)

If you are thinking of proposing tonight, check out An Updated Marriage Bonus and Penalty Calculator for Valentine’s Day from Roberton Williams at TaxVox before you commit!

News you can use. The SEC is Developing an Army of Robots to Replace You (Going Concern)

 

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Tax Roundup, 2/13/2013: The President wants more taxes. Because they’re doing such a good job with what they get now.

Wednesday, February 13th, 2013 by Joe Kristan

State of the union:  raise taxes more.  It will never be enough.  If you think we don’t have a spending problem, or think we can solve it through “closing loopholes,” check out three charts gathered by Veronique de Rugy:

20130213-120130213-2

20130213-3

The President proposes nothing serious.

Breaking news from yesterday: Look for a Call to End Oil “Subsidies” in Tonight’s State of the Union (Andrew Lundeen, Tax Policy Blog)

Howard Gleckman, Obama’s State of the Union and the Great Deficit Smackdown (TaxVox)

 

How H&R Block guy got to write preparer regs.  Civil Service! Tim Carney reports:

In 2009, the Obama administration hired Mark Ernst, the previous CEO of tax prep giant H&R Block, as IRS deputy commissioner. Ernst became a “co-leader” (in the words of an IRS spokesman) in drafting new regulations for tax preparers.

This seems to clash with President Obama’s executive order barring appointees from working on regulations directly affecting their former employers.

But thanks to a fine legal distinction, these rules didn’t cover Ernst. “Mark Ernst is a civil servant at the IRS; he is not a political appointee,” an IRS spokesman wrote me. “The Presidential Executive order on Ethics Commitments by Executive Branch Personnel only applies to political appointees.”

Nobody here but us chickens.

 

Jason Dinesen has a new installment about his client whose identity was stolen in the ID theft epidemic that really got rolling while the IRS was busy regulating preparers.  “If you hired the best comedy writers and satirists in Hollywood, they couldn’t come up with a more farcical script about government ineptness.”

Speaking of government competence:

Not only will most farmers have to file after March 1, 2013 due to a delay in tax forms by the IRS, we  now have an announcement that almost all form 1099s issued by the USDA for Natural Resources Conservation Services payments in 2012 are either wrong or were never issued.

via Paul Neiffer.

 

David Brunori, If You Hate or Love Excise Taxes Read this New Report:

A new working paper  recently released by the Mercatus Center at George Mason University… finds that contrary to conventional wisdom, sin taxes are often not used to correct externalities but rather for general fund spending. My take on that is politicians don’t really care about externalities. They would like to raise money from people whose activities they despise. The report also found that the goal of “sin taxes” has changed from correcting market failures to protecting consumers from their own choices. That is, people are too stupid to run their own lives and they need help. Finally, the report finds that sin taxes are regressive, i.e., they punish the poor. Unfortunately, my liberal friends never get exercised over this issue. Maybe it’s as the great PJ O’Rourke surmised, liberals hate poor people. 

If they would just not wear those icky Wal-Mart clothes and watch their weight, like they tell them to… (Tax.com)

 

Peter Reilly,Even Real Estate Salesman Has Trouble With Passive Loss Exception

Even accepting that he spent 520 hours working on his own properties, he still lost.  Two of the properties were short-term vacation rentals and one was being readied for sale.  The time spent on those properties could not be grouped with the time spent on properties dedicated to long term rentals.

As Peter notes, this becomes an even more important tax issue with the new 3.8% tax on “passive” income this year.

 

Kay Bell,  When will you get your tax refund? Whenever

Trish McIntire, Child Tax Credit Delays

TaxGrrrl, Spammers Target Taxpayers Expecting Tax Refunds.  If you get an email about your refund from the IRS, it’s not from the IRS.

Jack Townsend, Another Bull**** Tax Shelter Bites the Dust

Roger McEowen, Another Court Issues Ruling on Tax Impact of Demutualization.

Tax Trials,  Second Circuit: Co-Op Owner Is Entitled to Casualty Loss

Patrick Temple-West, Navigating between tax avoidance and evasion, and more

Gene Steurle, Desperately Needed: A Strong Treasury Department (TaxVox)

Robert Goulder, La Bella Italia: Fast Cars & Loose Taxes (Tax.com)

Jim Maule, When Spending Cuts Meet Asteroids: The Value of Taxes.  Taxes and spending can never be too high because, you know, asteroids!

The Critical Question.  Minnesota’s Sexiest Accountant Contest: Cute or Creepy? (Going Concern)

 

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Tax Roundup, 12/10/2012: Fund of Follies tax credits!

Monday, December 10th, 2012 by Joe Kristan

Tails.  We lose.   In 2002 Governor Vilsack signed into law a bill creating an Iowa “Fund of Funds” tax credit.  It’s back in the news:

Register Exclusive: Fund’s bailout costs Iowans $26 million

The Iowa Fund of Funds for startups never took off and a deal was needed to avoid a ‘train wreck.’

From the Des Moines Register:

A decade after the state tried to spark investment in young innovative companies, Iowa taxpayers will foot a $26 million bill — and potentially more — to meet the program’s obligations.

State attorneys reached an agreement in August to avoid a lawsuit from two lenders who backed the Iowa Fund of Funds, a program lawmakers created in 2002 to attract more venture capital investment in Iowa startups.

In August? And we’re just hearing about this now?  Maybe it’s because it’s an embarrassment to the entire Iowa political class that they just want to have go away.  While signed by a Democratic governor, it passed the Iowa House 90-3 and the Senate 39-5  — lots of votes from both parties there.  When the state is giving millions in new tax credits for fertilizer companies, it would poop the party.

Let’s set the wayback machine to one of the earliest Tax Update posts — number 48 of over 8,000 — to see what we had to say about the Funds of Funds when it was enacted:

HEADS YOU WIN, TAILS WE LOSE?

…is the concept behind the venture capital legislation. A state-owned for-profit corporation will set up a “fund of funds” partnership to invest in venture capital pools. The venture capital pools are to be chosen based on their commitment of funds to Iowa.

Investors in the “fund of funds,” which we will call the FOF, will receive certificates maturing no sooner than 2005 entitling them to a tax credit. This credit will reduce their Iowa tax dollar for dollar to the extent the return on the FOF is less than a fixed return computed on the certificate. In other words, the investors in the FOF get the upside, but the state absorbs the downside – and even some of the upside, to the extent that there is a positive return lower than the amount set by the certificate.

At the time we received a note from Steven Ringlee, described in today’s Register story as “an architect of the program,” telling us that this was still a terrific deal for Iowa taxpayers because the bill also had a cap on investor return as well as a taxpayer-funded guarantee against losses:

In fact, you fail to notice that, due to the tax credit which provides full repayment security to Iowa taxpayers purchasing the preferred stock of the Fund of Funds, their required rate of return will be similar to that on medium-term governmental debt instruments.  In Oklahoma, where this plan was first implemented, the return on their Fund of Fund instruments (circa 1995) was approximately 8 percent.  In today’s environment, it will approximate 5 to 5.5 percent.  However, the average long-term rate of return on investments in venture capital limited partnerships has been in excess of fifteen percent over an extended period.  Oklahoma experienced a 19 percent positive return during the five year period from inception through 2001.

So how did those 15 percent returns work out?  From the Des Moines Register story:

“It’s been a disaster. As a model for creating jobs, it doesn’t work. … It’s turning into another bad deal for taxpayers,” said Sen. Joe Bolkcom, D-Iowa City.

Jeff Thompson, a deputy attorney general who helped negotiate the agreement, says Iowa taxpayers have always been on the hook for the program, originally authorized at $100 million and later limited to $60 million. This agreement reduces the potential costs and, perhaps more important, prevented lenders from cashing in up to $40 million in tax credits this summer to cover their loans, he said.

That sounds like a return of something less than 15%.  The Register story doesn’t quantify the losses.  Mr. Ringlee didn’t exactly rule out the possibility of losses in 2002, but he made them seem unlikely (my emphasis):

 

As a result, appropriate compensation-for-risk-assumed is in fact given to the State, the grantor of the contingent tax credits.  For what is likely to be zero cash outlay, the State of Iowa, (at the end of the FoF lifetime) receives all accumulated net profits above a nominal return in the range of 5.5%.  Of course, the probability of this occurring is directly related to the skill sets of the VC managers selected to invest the funds.  Because VC historical returns are in fact measurable and venture managers’ skills may be examined in detail, and because good managers tend to have consistent track records, the Fund should be able to select those managers able to deliver above-average results.  Hence, the Fund can improve its ability to deliver stellar returns to the State (the residual legatee) by carefully selecting and supervising its venture capital limited partnership managers.  It will do so through the judicious selection of a skilled, experienced “gatekeeper” fund allocation manager, a common practice in the venture industry.

Oops.

Folks, when the government guarantees something, the proper assumption is that the guarantee will be called upon (Solyndra, anyone?).  If private investors aren’t willing to make a deal, they probably have good reasons.  If it’s a good company, private money will probably be there, if perhaps on stiffer terms.  And just because the guarantees are run through tax returns doesn’t make them somehow not spending.

Senator Joe Bolkcom  (D-Iowa City)– who was one of the few who voted against the program in 2002 – makes a good point:

Bolkcom said the state needs to rethink how it approaches economic development.

“The idea that we can create these third-party arrangements, where we turn over taxpayers’ money and not expect problems to develop, is folly. We have very little control after the law was created,” he said.

The best the state can do for economic development is to leave it alone.  The Quick and Dirty Iowa Tax Reform would get rid of all of the dozens of ”economic development” tax credits, and do more for the Iowa economy than all of them.

 

TaxProf,  NY Times: Tax Arithmetic Shows Top Rate Is Just a Starter

Oh, Goody:  “Taxpayers and the IRS could be looking at three filing seasons in 2013 if Congress and President Obama fail to prevent the government from going over the fiscal cliff at year’s end, according to National Taxpayer Advocate Nina Olson.”  (Tax Analysts, $link)

Greg Mankiw,  Fiscal Cliff Fact of the Day:

As reported in the NY Times:

Even if Republicans were to agree to Mr. Obama’s core demand — that the top marginal income rates return to the Clinton-era levels of 36 percent and 39.6 percent after Dec. 31, rather than stay at the Bush-era rates of 33 percent and 35 percent — the additional revenue would be only about a quarter of the $1.6 trillion that Mr. Obama wants to collect over 10 years.

Like I say, the rich guy isn’t buying.

Gene Steurle,  Current Revenue Solutions Will Barely Reduce the Deficit.  (TaxVox)

Patrick Temple-West,  Fiscal talks spur charitable giving, and more

TaxGrrrl,  Obama, Boehner Reach Compromise?  No.

Scott Drenkard,  New Federal-State Rate Calculation in Full Fiscal Cliff/Obamacare Scenario (Tax Policy Blog)

Christopher Bergin,  ‘Small Ball’ — Obsessing about the Rich:  “Sticking it to rich people may play well to a populist theme, but it’s “small ball” and does little to address our fiscal problems or our broken tax system.”  (Tax.com)

Martin Sullivan,  Is the Charitable Deduction a Sacred Cow? (Tax.com)

So how are the tax increases working out for you? California Revenues Below Expectations (Russ Fox)

 

TaxProf,  Supreme Court Grants Cert to Decide Whether Estate Tax Marital Deduction Applies to Same-Sex Couple.  I predict the court will reverse DOMA.  If your taxes have been boosted by the denial of marriage benefits to same-sex couples, you should consider filing a protective refund claim; 2009 is the oldest year still open.

Kay Bell,  Supreme Court to review estate tax challenge to Defense of Marriage Act

 

KCCI.com:  GOP to introduce death penalty bill.  Apply it first to legislators who vote for new tax credits and I’ll be interested.

 

Great tool for understanding new net investment income tax regs: Cheat Sheets To The Obamacare Investment Income Tax (Anthony Nitti)

Peter Reilly,  Can Real Estate Professionals Beat The 3.8% Obamacare Tax ?

 

Jack Townsend,  DOJ Tax and IRS Entreaties to Join OVDP 2012:

These are in effect pleas / warnings to taxpayers to turn themselves in by joining OVDP 2012.  I suspect that the truth is that, if a significant number of taxpayers do not turn themselves in, the IRS will have limited ability to discover, investigate and prosecute criminally or civilly all of that dataset.  DOJ Tax and the  IRS are trying to convince taxpayers that the form of audit lottery they play going far now will have worse odds than it had previously.  Perhaps everyone involved will not suffer the consequences, but many will and, among the many that will, could be you.  And the consequences could be far worse than if you come clean now and get right for the past and going forward.

 If you really are a tax cheat, by all means consider using the OVDP program.  Still, it would probably be much more attractive if the IRS didn’t treat foot-fault violators as international tax criminals.

 

Robert D. Flach gets it right in WHY WE NEED TAX REFORM:

The purpose of the Tax Code is to raise the income necessary to run the government.  It should not be used to solve all the financial and social problems of the country.  It should not be used as a method of distributing social welfare program benefits.  It should not be used as a means of “redistributing” income among the “classes”.  The Tax Code is not Robin Hood.

It’s hard enough to determine taxable income, compute a correct tax, and remit it.  You can’t also ask Iowa tax authorities to administer filmmaking or venture capital.   And to expect the undertrained and undermotivated members of the shrinking IRS work force to administer industrial growth, social justice and, oh yeah, the health care system is folly.  And official policy.

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Tax Reform Carnival!

Friday, October 21st, 2011 by Joe Kristan

I haven’t heard about the massive parties scheduled to honor the 25th Birthday of the Tax Code tomorrow, but I’ve been out of town, so I probably just missed the news. No doubt they will look something like this:
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If you choose a more sedate way of observing the holiday, the tax blog world is all over it already, so there’s your party. I’ll round up their observations in this impromptu Tax Reform Carnival. I’ll add to this list of blog observations as I notice them; if I miss yours, please put the link in the comments and I’ll add it to the party.
Going Concern, Joe Kristan: Who’s Afraid of Tax Reform?
Tax Prof: Graetz: Tax Reform 1986 — A Silver Anniversary, Not a Jubilee
TaxVox, Howard Gleckman: Five Lessons from the 1986 Tax Reform Act
TaxVox, Gene Steurle: Does the Tax Reform Act of 1986 Offer Lessons for Future Reform?
Robert D. Flach (Forbes guest post): Wandering Tax Pro Remembers The Tax Reform Act of 1986
Tax Policy Blog, Scott Hodge: Happy Anniversary Tax Reform Act of 1986
TaxGrrrl: I’m From the Government and I’m Here to Help
Update, 10/22
TaxProf, Forbes: Today’s 25th Anniversary of the Tax Reform Act of 1986
Kay Bell, 25 years of tax reform. More on the way?

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