Ethanol, clean energy fuel drama over GOP debt limit deal - Maxine Joselow and Vanessa Montalbano, Washington Post:
Punchbowl News has more:
Remember that anything being talked about here is far from ever actually being law. It does give an idea of what may, and may not, be bargaining chips in extending the debt ceiling. For more background, read Jay Heflin's House GOP Kills IRS Funding, Modifies Energy Tax Credits in Debt Limit Bill.
More importantly, McCarthy’s leadership team eliminated the repeal of three biofuel tax credits. For the remaining two — created by the Democrats’ Inflation Reduction Act — the GOP said they didn’t apply to taxpayers who made investment decisions based on the credits.
In addition, the leadership-drafted amendment rescinds funding from the Inflation Reduction Act for green building construction, Energy Department loan guarantees, deferred maintenance for national parks, air pollution for states and municipalities and for a neighborhood access and equity grant program.
Energy tax credits a big test for GOP vote counters on debt bill - Laura Weiss and Lindsey McPherson, Roll Call. "Further, some Midwestern Republicans have expressed concerns about the bill’s provisions targeting a separate tax credit for “second generation” biofuels made from the inedible parts of crops; a new “sustainable” aviation fuel tax credit to incentivize biomass-based jet fuel usage; and a credit for projects capturing and storing emissions from ethanol plants and other carbon-producing facilities like two being built in Iowa."
Why plunging tax receipts are raising fears about the debt ceiling - Aris Foley, The Hill. "Before tax figures started rolling in after last week’s filing deadline, Congress appeared to have until sometime in late July or August to pass legislation to raise or suspend the debt limit. But some experts have warned that a major shortfall in tax revenue means the U.S. government could run out of cash as early as June."
Minn. House OKs Recreational Cannabis Regulation, Tax - Sanjay Talwani, Law360 Tax Authority ($):
The House approved H.F. 100, sponsored by Sen. Zack Stephenson, D-Coon Rapids, by a 71-59 vote, with amendments. If enacted, possession of up to 2 ounces of marijuana would be legal in August, with licensed retailers to follow at an unannounced date. The
The bill goes next to the state Senate, and both Democrats and Republicans predicted differences in two proposed measures would be settled in a House-Senate conference committee. The Senate companion bill, S.F. 73, would set the tax rate at 10%.
Tennessee Legislature Passes Business Tax Cuts, Single Factor - Matthew Pertz, Tax Notes ($).
Tennessee Gov. Bill Lee (R) is hailing the passage of his 2023 legislative agenda, which includes switching the state to single-sales-factor apportionment and cutting taxes.
H.B. 323 would phase in single-sales-factor apportionment for franchise tax over three years and create a franchise tax credit for businesses that provide paid family and medical leave. It would also establish a $50,000 standard deduction against the excise tax and a $500,000 property exemption against the franchise tax after December 31, 2024.
IRS Ramps Up Policing Of Abusive Partnerships, Official Says - Kat Lucero, Law360 Tax Authority ($). "The agency has been applying the anti-abuse rule, which discourages the formation of partnerships for the main purpose of reducing the value of partners' federal income tax, "much more than we used to," said Clifford M. Warren, senior counsel to the associate chief counsel in the pass-throughs and special industries group at the IRS. Warren was speaking at the Practising Law Institute's tax-planning conference for domestic and foreign partnerships, held in Chicago and online."
US Tax Credit Issues Loom for Companies Under Global Minimum Tax - Isabel Gottlieb and Danish Mehboob, Bloomberg. "If the US doesn’t give them a credit when its own minimum tax rule overlaps with minimum taxes applied domestically by other countries, companies risk being taxed twice on the same income."
After Beyoncé Failed To Work It Out With IRS, She Filed A Petition In Tax Court - Kelly Phillips Erb, Forbes ($). "Knowles-Carter disputes the deficiency, claiming, among other things, that the IRS erred in disallowing millions of dollars' worth of deductions, including $868,766 attributable to a charitable contribution carryover reported in 2018."
Tax record keeping tips - Kay Bell, Don't Mess With Taxes. " The main record everyone should have and keep forever — more on how long you need to keep tax material later — is your actual form 1040. That includes all attached schedules and other forms you also sent to the Internal Revenue Service."
Taxpayer's Delivery of Cashier's Check to Pay Settlement to Their Attorney Before Year End Did Not Count as Payment In That Year - Ed Zollars, Current Federal Tax Developments. "In the case of Gage v. Commissioner, TC Memo 2023-47, a taxpayer found that even though they believed they had paid an $875,000 settlement to the Department of Housing and Urban Development by the end of 2012, in fact the payment was rather treated as made in 2013 for income tax purposes."
Lies for Likes: Evaluating Social Media Tax Scams - David Stewart, Cady Stanton, and Samuel Brunson, Tax Notes Opinions. "At the same time, the tax community, probably, many of us, it's a learning curve to learn how to appropriately use TikTok and Instagram and Facebook. But we could participate, too. We could see these (scams, etc.) and either respond or put out good information."
Deductibility of Personal Interest and the Home Mortgage Exception - Roger McEowen, Agricultural Law and Taxation Blog. "Presently, there exist different rules for the three types of interest: personal interest, investment interest and business interest. For farmers and ranchers, the bulk of farm interest should be deductible as business interest. That makes the classification of interest the end of the inquiry critical to determining the proper tax treatment."
Proposed Regulations Identify Micro-captive Transactions As Listed Transactions - Parker Tax Pro Library.
Details Emerge On How The IRS Will Navigate The $400K Pledge - Janet Holtzblatt, TaxVox. "Will the pledge improve compliance among the taxpayers with income above $400,000 without also reducing compliance by those with lower incomes? A lot depends on the quality of the IRS’s enforcement tools. Perhaps investments in data analytics and machine learning will enable the IRS to better detect taxpayers who underreport income to be below the $400,000 threshold. And maybe the IRS will be able to rely more on tools other than audits (say, notices for mismatches between amounts on tax returns and 1099s) to prevent noncompliance by taxpayers with income below $400,000."
Tech Needed to Simplify Energy Credits for Individuals - Annette Nellen, 21st Century Taxation. "Special tax rules tend to be complex because they are 'special' in that they are not part of the normal tax system and are not intended for all taxpayers and all activities. Drafting legislation and regulations to be sure the credits are used as intended, is challenging. We are seeing this with most of the energy credits added or modified by the Inflation Reduction Act of 2022. The IRS has to define many challenging term"s that were not completely spelled out in the legislation, such as the value of critical minerals, battery components, and more."
Inflation Reduction Act’s Price Controls Are Deterring New Drug Development - Erica York, Tax Policy Blog. "The Inflation Reduction Act (IRA) imposed a new policy to allow the government to set the price of certain prescription drugs for Medicare. If firms do not comply with the government-mandated price, they can face exorbitant excise taxes on their drug sales (up to 1,900 percent)."
But he wasn't using it. Fla. Bar Says Atty Took From Jailed Client's $2M Tax Refund - Madison Arnold, Law360 Tax Authority ($). "The Florida Bar has accused a Sunshine State attorney of allegedly using about $2 million in tax refund money belonging to an incarcerated client to benefit his own father's business and pay private club memberships and other personal expenses."
Alex Murdaugh charged with two counts of tax evasion - Stephan Neukam, The Hill:
Alex Murdaugh, the former South Carolina lawyer who is in jail for life for the killing of his wife and son in 2021, was charged with two counts of tax evasion by a state grand jury."
Once he deals with this, he's in the clear, right?
He faces about 100 other charges. The charges range from claims of more tax evasion, accusations he stole money from clients as a lawyer, and ran a drug and money laundering operation. He is also accused of life insurance fraud, scheming to have his friend kill him and having a life insurance policy pay $10 million.
Former Air Force civilian employee sentenced to more than 15 years in prison for fraud - IRS (defendant name omitted):
According to court documents, Defendant was a civilian government employee authorized by the Air Force to solicit and accept orders for flight simulator technology and support, and to promote and manage related contracts. As part of a scheme that spanned more than 10 years, Defendant conspired with others who paid him more than $2.3 million in cash and bribes for $100 million in work on Air Force projects.
Senior United States District Judge David Ezra sentenced Defendant to 36 months confinement with one year of supervised release for the charge of making a false income tax return, and 188 months confinement followed by three years of supervised release for the charge of conspiracy to commit wire fraud. Those sentences will run concurrently. The judge also ordered Defendant to pay $736,618 in restitution to the IRS and, $38,733,720.65 in restitution to the Air Force, Army and General Services Administration and to forfeit $2,342,095 that he received in bribe money.
So mostly the bribes.
They still roam the Earth. It's National Bookmobile Day!