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Key Takeaways
- Election Aftermath
- IRS
- Disaster Relief
- Nonprofit Classification
- Pandemic Tax Refund
- TCJA
- In the Courts
- Happy Hour
Election Aftermath
Trump Victory Threatens Key Muni Tax Break in Hunt for Revenue – Maxwell Adler and Amanda Albright, Bloomberg ($):
President-elect Donald Trump has promised to further cut corporate taxes and even eliminating the federal income tax. If he goes through with those plans, lawmakers will need to find additional revenue to offset the cuts’ trillion-dollar price tag. The muni tax-exemption — estimated to cost the US government less than $40 billion each year — has long been seen as a possible source of funding.
Republicans’ First Tax-Cut Challenge: How Much Red Ink Can They Live With? – Richard Rubin, The Wall Street Journal:
The Number is the maximum budget deficit increase that Republicans are willing to tolerate as they extend tax cuts scheduled to expire after 2025 and advance the rest of President-elect Donald Trump’s plans. To unlock the gate to the legislative fast track that lets them sidestep Democratic objections, Republicans must agree, with virtually no defections, on The Number.
Trump Win Casts Shadow Over OECD Global Tax Reforms – Stephanie Soong and Andrew Velarde, Tax Notes ($):
News of President-elect Trump’s sweeping win in the November 5 election and the Republican Party’s Senate gains and potential control of the House of Representatives come as member jurisdictions of the OECD inclusive framework on base erosion and profit shifting work to finalize pillar 1 and legislate for pillar 2.
Most inclusive framework members — including the United States — agreed to the plan in principle in October 2021. However, the path to implementation has been long and fraught with questions about whether the United States would actually adopt the two pillars.
Americans Staged a Property Tax Revolt on Election Day – Will Parker, The Wall Street Journal. “Voters in eight U.S. states this week passed measures to offer some form of relief on property tax, a sign of their mounting frustration with tax bills that have soared alongside big increases in home values.”
IRS
End to Surprise Field Collection Visits Yielded Safety Gains – Nathan J. Richman, Tax Notes ($). “The IRS’s efforts to ensure the safety of its revenue officers have proved to be successful in the past year after the agency ended its practice of unannounced civil collection visits, an official said.”
IRS Criminal Division Getting Interested in Wealthy Nonfilers – Nathan J. Richman, Tax Notes ($):
CI has 62 open cases on high-income nonfilers and has obtained 12 convictions so far, Jones said November 8 at the New England IRS Representation Conference.
IRS Continues to Scale Up Hiring Efforts – Benjamin Valdez and Nathan J. Richman, Tax Notes ($):
The agency expects to keep hiring, and it's happening as rapidly as possible, Mary Beth Murphy, deputy commissioner of the IRS Small Business/Self-Employed Division, said November 8 at the New England IRS Representation Conference. The IRS has grown to about 100,000 employees, she said.
Disaster Relief
Disaster Tax Relief Could Be on Slate in Lame-Duck Session – Asha Glover, Law360 ($):
Ahead of negotiations to address the Tax Cuts and Jobs Act provisions that are set to expire at the end of 2025, there are some tax proposals that Democrats and Republicans in Congress could agree to pass before the end of this year.
Nonprofit Classification
9th Circ. Says Univ. Wrongly Deprived of Tax-Exempt Status – Anna Scoot Farrell, Law360 ($):
The federal education department wrongly used Internal Revenue Service rules for determining the school's nonprofit status rather than applying provisions outlined in the Higher Education Act of 1965, a three-judge panel said, remanding the decision to the DOE for further review.
Pandemic Tax Refund
Ex-Spouse Entitled To $2.9M Pandemic Tax Refund, Court Told – Anna Scott Farrell, Law360. “A woman is entitled to a $2.9 million tax refund under pandemic-era relief provisions for carryback losses shared with her ex-husband, she told a Texas federal court, accusing the Internal Revenue Service of wrongly requiring both of the former couple's signatures on a consent form.”
TCJA
With Planning, TCJA Extensions May Pass Sooner Than Thought – Doug Sword and Cady Stanton, Tax Notes ($). “The heavy lifting for a major tax bill could be completed in the House in the early months of 2025, though how quickly a package would move is hard to gauge.”
In the Courts
Treasury Urges Supreme Court to Skip Review of Tax Records Suit – John Woolley, Bloomberg ($). “The US Supreme Court should deny review of a taxpayer’s lawsuit seeking records from the IRS using a confidentiality and disclosure statute in the tax code, rather than through a traditional Freedom of Information Act request, the Treasury Department said Friday.”
IRS Drops Appeal of Summons Fight in Conservation Easement Case – Tristan Navera, Bloomberg ($). “The government will no longer pursue an appeal seeking to enforce six summonses the IRS issued as part of its examination of a Georgia real estate firm’s conservation easement activities.”
'Varian' Irrelevant to Liberty Global Tax Refund Suit, US Says – John Woolley, Bloomberg ($). “The US Tax Court’s ruling in Varian Medical Systems v. Commissioner sheds no light on Liberty Global Inc.‘s $110 million tax refund appeal because it doesn’t address the economic substance doctrine, the US told the Tenth Circuit.”
Reliance on IRS to Claim Tax Credit Draws Appeals Court Scrutiny – Tristan Navera, Bloomberg ($). “A New York-based civil engineering company’s claim that the IRS treated it unfairly by denying a tax credit elicited close questioning from a federal appeals court panel Friday.”
What Day is it?
The perfect day to knock off early and enjoy National Happy Hour Day. Have one (or two) for me!