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Remember the Deadline! 2020 extended 1040s and 1120s are due Thursday. Don't wait until the last minute to return your e-file authorizations to ensure timely filing.
Coronavirus Stimulus Talks With White House at Impasse - Kristina Peterson and Andrew Duehren, Wall Street Journal ($). "Democrats criticized the nearly $1.9 trillion offer from Treasury Secretary Steven Mnuchin as insufficient, particularly in its funding and strategy for coronavirus testing and tracing. Senate Republicans, meanwhile, balked at the offer’s cost and its proposed expansion of the Affordable Care Act. The concerns from both sides of the Capitol lowered expectations that had risen Friday when President Trump approved the most generous GOP offer to date in the negotiations."
Why Is Wall Street So Terrible at Handicapping Fiscal Politics? - Joseph Thorndike, Tax Notes Opinions:
Consider the last few days. When President Trump declared early in the week that he was done trying to negotiate with Democrats over a COVID-19 relief bill, the stock market plunged in the afternoon. When he softened his position overnight, the market rallied after the opening bell.
In both cases, the investors acting collectively seemed to overestimate two things: (1) the seriousness of Trump’s statements, and (2) the influence that Trump wields on Capitol Hill.
Not exactly bullish on another COVID bill.
Expiring breaks for brewers, airlines driving tax extenders push - Doug Sword, Roll Call. "No matter their size, eligible brewers, vintners and distillers would have to start making cost-cutting decisions soon in anticipation of higher taxes early next year."
HLB Wins 2020 Network of the Year. Eide Bailly is a member of HLB, an international organization of independent accounting firms:
"Our membership with HLB International unlocks a wealth of knowledge from resources around the globe," said Shannon Lemmon, Eide Bailly's Partner-in-Charge of International Tax. "We were very excited to hear of the well-earned Network of the Year award, and we look forward to seeing how HLB continues to grow and succeed."
Estate Litigators Look to Cement Support for ‘Tax Affecting’ - Jonathan Curry, Tax Notes ($). "Taxpayers had already claimed that a pair of recent court decisions legitimized the 'tax affecting'maneuver, which can be used to discount earnings from a passthrough entity such as an S corporation by adjusting for differences between passthroughs and C corporations when valuing business interests, according to Stephanie Loomis-Price of Winstead PC."
Related: 10 Common Questions in Estate Planning
COVID-19 May Push Paper Use Out of IRS - Frederic Lee, Tax Notes:
After the IRS issued a March 27 evacuation order for employees, the agency altered procedures to allow for the electronic submission of certain documents and incorporated virtual hearings on proposed regulations. The agency also broadened the list of forms that taxpayers can sign digitally, and its People First Initiative suspended many collection and examination functions between April 1 and July 15 because of the coronavirus outbreak.
It's a late start, but it's a start.
States Grapple With Depleted Unemployment Insurance Trust Funds - Lauren Loricchio, Tax Notes. "States are beginning to grapple with the issue of their unemployment insurance (UI) funds, which have been depleted by swaths of workers who are unemployed because of the COVID-19 pandemic."
Governor Bullock Directs $200M in Coronaviurs Relief Funds to Boost UI Trust Fund, Lower Fees for Montana Businesses (Press Release). "Governor Steve Bullock today announced he is directing $200 million in state Coronavirus Relief Funds to effectively double the Unemployment Insurance Trust Fund and prevent the thousands of Montana businesses who pay into unemployment insurance from experiencing an 85 percent spike in their tax rate."
Unweirding Portland’s Targeted Tax Regime - Nikki E. Dobay and Jeff Newgard, Tax Notes ($):
Over the last decade, however, Oregon localities, particularly in the Portland area, have advanced what some might call novel tax proposals intended to support progressive causes and spending initiatives. These taxes target classes of taxpayers that the proponents would likely assert need to pay “their fair share” but result in a complicated tax structure that undermines the regional economic and business climate, and, thus, the taxes collected. A single firm operating in Portland is subject to a minimum of seven different taxes between federal, state, regional, county, and city governments, and, if the business has sales exceeding some thresholds, may have multiple gross receipts taxes layered on top.
Boo! — Personal Liability Exposure for Your Business’ State Taxes - Zachary J. Montgomery, Freeman Law Blog. " Failure to remit your business’ taxes to the state may result in a personal visit by the Office of the Texas Comptroller or Texas Attorney General."
Related: Identifying Your Sales Tax Risks
Legal holidays and how they can affect federal taxes - Kay Bell, Don't Mess With Taxes. "But the IRS has a specific definition for legal holiday. It's one that is a legal holiday in the District of Columbia. That's why Emancipation Day, a Washington, D.C., holiday that's not widely celebrated across the United States, sometimes comes into play at April tax filing time."
Trump Seven Springs Easement Deduction May Be Reasonable - Peter Reilly, Forbes. "Conservation easement deductions have been a tool for developers like President Trump for quite a while. Here we see it being used as a sort of bailout on a project that proved infeasible."
A Close Look at Joe Biden’s Social Security Proposals - Melissa M. Favreault, TaxVox. "Like his Democratic primary challengers, Biden would reduce the program’s long-range financial imbalance by expanding Social Security’s payroll tax base, now limited to $137,700 of earnings. He would expand some benefits while not reducing any, reducing economic hardship. While Biden’s proposal would not eliminate Social Security’s 75-year shortfall—a standard goal of policymakers for decades—his approach, if enacted by Congress, would reduce the size of the projected gap by about one quarter."
Consistency and the Validity of Regulations - Monte Jackel, Procedurally Taxing. "Can the IRS write a regulation that circumvents the dictates of the U.S. Supreme Court using a general grant of regulatory authority under section 7805(a)? I would think that the answer is clearly and obviously no. But what is the price that the IRS will ultimately pay if the results enumerated here are overruled by a court several years down the road? Other than spending taxpayer dollars unnecessarily, it does not appear that there is any downside in doing so."
Despite Tax Receipts, Court Orders Destruction Of ‘Historic’ Moonshine - Kelly Phillips Erb, Forbes. "The alcohol allegedly belonged to Popcorn Sutton, a legend in the area. Sutton was born in 1946 in Maggie Valley, North Carolina. He was a modern-day bootlegger, not only producing but selling and promoting moonshine."
Today in history. Sixty years ago today, Bill Mazeroski hit the first walk-off home run to end a World Series.