Key Takeaways
- Efforts to overturn EV tax credit regulations
- Battle over tax cuts
- Scam warning
- Loans from foreign trusts
- In the courts
- National kitten day!
EV Tax Credit Regulations
Effort to Overturn Biden EV Tax Credit Rules Heads to GOP House – Samantha Handler, Bloomberg Tax ($).
The tax panel voted along party lines to send a resolution to the full House that would nix electric vehicle tax credit rules that give automakers an extra two years to shore up battery minerals considered difficult to trace to their origin. The rules, implementing part of the Democrats’ 2022 tax-and-climate law, prompted bipartisan criticism and Sens. Joe Manchin (I-W.Va.) and Sherrod Brown (D-Ohio) are part of the effort to overturn them in the Senate.
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The resolution now heads to the full House, and is expected to pass with at least some Democratic support... President Joe Biden will likely veto it.
Measures Advance to Penalize Universities, Overturn EV Credit Regs – Cady Stanton, Tax Notes ($).
"House GOP taxwriters moved on a handful of their party’s priorities in advancing tax-related measures on the exempt status of colleges and universities, the use of section 529 account savings plans, and a resolution to overturn Treasury regulations on clean vehicle credits."
Tax Cuts Negotiations
IRS Funding At Stake In 2025 Tax Cut Negotiations – Asha Glover, Law 360 ($).
Lawmakers have already dedicated a significant amount of time this year to the debate over the extension of the Tax Cuts and Jobs Act provisions set to expire in 2025. Republican members of the House Ways and Means Committee in April announced plans to form 10 teams to study key provisions of the 2017 tax overhaul aiming to set priorities for legislative action next year.
Flips of Passthroughs Into C Corps Could Be Costly as TCJA Lapses – Doug Sword, Tax Notes ($).
The CBO estimates that a full extension of Tax Cuts and Jobs Act provisions past their December 31, 2025, expiration would cost $4.6 trillion over 10 years. But there are also costs to not extending the 2017 tax code overhaul as passthrough businesses convert to a lower-taxed business form.
Scam Warning
Identity thieves are taking numerous approaches to steal sensitive information from tax professionals. This includes posing as new clients; using phishing emails to trick people into sharing Central Authorization File information as well elaborate schemes involving calling and texting. Tax professionals need to be on the lookout to avoid falling prey to these attacks, which threaten not just their clients but their businesses.
Loans from Foreign Trusts
New Rules Address Loans to U.S. Persons From Foreign Trusts – Carrie Brandon Elliot, Tax Notes ($).
"Published May 8, new proposed regs (REG-124850-08) provide guidance on information reporting of transactions with foreign trusts, receipt of large foreign gifts, loans from foreign trusts, and uses of foreign trust property. The regs also contain proposed amendments to the rules governing foreign trusts that have one or more U.S. beneficiaries. The proposed regs affect U.S. persons that own or transact with foreign trusts, or that receive large gifts or bequests from foreign persons. Public comments must be received by July 8."
In the Courts
ND Justices Affirm Sales Tax On Oilfield Equipment – Sanjay Talwani, Law 360 ($).
In a decision Friday, the North Dakota Supreme Court rejected an appeal by Equinor Energy LP, which argued that the state tax commissioner misapplied the law in denying refunds in sales taxes paid from 2013 to 2016. The justices affirmed a district court decision that the purchases of the equipment — separators used to isolate oil, gas and water — were not exempt from sales tax because the exemption applies only to gear installed downstream from a well site.
Man Gets Five Years for Theft From Employer, Filing False Taxes – DOJ (Defendant name omitted).
The government said the defendant lied and deceived others for his own benefit from the outset of his former employment through the entirety of the court proceedings. the Defendant spent years lying to his employer while stealing money and then, simultaneously, providing false information on his tax returns, according to the announcement.
Ohio man pleads guilty to filing false tax returns and wire fraud – IRS (Defendant name omitted).
The defendant pleaded guilty to the offenses in court on March 1, 2024, where he admitted to filing false tax returns with the IRS by underreporting taxable income of nearly $880,000 earned as owner of a convenience store and a restaurant in Toledo from 2012-2018. Prior to sentencing, the defendant paid all taxes and penalties owed to the IRS resulting from his tax offenses.
What day is it?
It’s National Kitten Day! "Surprisingly Americans seem to like cats and kittens best: According to the American Humane Society, 95.6 million cats were owned, while 83.3 million households owned a dog."
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