Tax News & Views- Senate Control and Tax Policy.

January 6, 2021

The Path Ahead for President-Elect Biden's Tax Policies.  Steve Gallucci and Banks Edwards, Bloomberg Daily Tax Report.

"If Democrats capture the two Senate seats, they will control both the House and Senate (albeit by the narrowest of margins), as well as the influential tax-writing committees in both chambers. This will give Biden a path to pass some substantial tax policy changes, including a number of potential tax increases that would have a significant impact on corporations and certain high-income individuals. But the narrow majorities in both chambers would leave him with little room for error as he navigates the sometimes conflicting priorities of lawmakers in the progressive and moderate wings of the party."

Trading Partnership Approach Remains in Final Interest Regs.  Eric Yauch, Tax Notes.

"Newly released final regulations retain the IRS and Treasury’s overall approach on the application of the business interest deduction limit for trading partnerships, but they punt on some other earlier proposals for partnerships."

Shutting Down States as Tax Havens: Will It Work?  Amy Hamilton, Tax Notes.  

"According to the text of the new law, more than 2 million corporations and LLCs are formed under state laws each year. Because of the ease with which anonymous shell companies can be created under them, business incorporation laws are at the root of the reputation some states have gained as tax shelters or even tax havens."

These Tiny Last-Minute Tax Changes Could Be a Big Deal in 2021 Laura Sanders, WSJ. 

Year End Tax Planning, Even After The Year End.

"Last year Congress passed two important bills in response to Covid-19 that contain a slew of tax changes, with the most recent one signed by President Trump on Dec. 27. Some of the changes apply only to 2020, while others affect more than one year or take effect beginning in 2021. The new year also brings automatic inflation adjustments that slightly shift tax brackets and some other thresholds."

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