Tax News & Views Tax Cut the Cake Roundup

Taxes could go up, down or completely sideways next year, depending on which political party controls which parts of the government after the too-close-to-call November elections.

With the House, Senate and White House all in play, trillions of dollars ride on a few hotly contested seats. Lawmakers, analysts and investors are busily gaming out scenarios, trying to understand how the next Congress might handle expiring tax cuts and other fiscal debates.

A Republican sweep led by Donald Trump could yield a fresh round of tax reductions. Full Democratic control with Kamala Harris in the White House—less likely given the current trajectory of Senate races—could spur higher taxes on corporations and wealthy households. Divided government—a president from one party and Congress at least partially controlled by the other—could cause a deadline-breaching showdown in December 2025 or a rare bipartisan agreement.

The surge in corporate income tax collections for fiscal 2024 could provide fodder for both sides of the Tax Cuts and Jobs Act debate on whether corporate tax breaks increase or decrease receipts over the long run.

Corporate tax collections are running ahead of pre-TCJA forecasts after initially falling short. Meanwhile, individual income tax collections over the seven completed fiscal years since the TCJA went into effect are almost exactly what was projected despite across-the-board cuts in individual tax rates and the 20 percent passthrough deduction.

Some tax-exempt organizations will have more time to make elective payment elections on the form they use to report unrelated business income.

In Rev. Proc. 2024-39, 2024-45 IRB 1, released October 11, the IRS granted applicable entities under section 6417(d)(1)(A) six additional months to file an original or superseding Form 990-T, “Exempt Organization Business Income Tax Return (and proxy tax under section 6033(e)),” along with any relevant schedules and forms, for purposes of making an elective payment election.

Staring down trillions of dollars in expiring provisions and expensive presidential campaign trail tax proposals, lawmakers are at odds within their own parties and factions on which provisions will need offsets and to what degree.

There appears to be consensus that the $35.7 trillion (and counting) federal debt will be significant in next year’s tax debates, yet the costly tax proposals ranging from $6,000 child tax credits to tax-free Social Security benefits keep rolling in.

Due to Hurricane Milton, the Internal Revenue Service today announced relief for individuals and businesses in 51 counties in Florida.

Individuals and businesses in six counties that previously did not qualify for relief under either Hurricane Debby or Hurricane Helene will receive disaster tax relief beginning Oct. 5, 2024, and concluding on May 1, 2025. They are Broward, Indian River, Martin, Miami-Dade, Palm Beach and St. Lucie.