Tax News & View Sports Betting and Moms, Be Lazy Roundup

Campaigning and Taxes

TCJA Extension Poses Quandary for Estate Tax Exemption- Cady Stanton, Tax Notes($):

Estate tax reform may be a target for both parties come the expiration of its doubled exemption threshold at the end of 2025, but the narrow impact of the provision creates complicated political considerations.

The Tax Cuts and Jobs Act doubled the estate tax exemption to $11.4 million for single filers and $22.8 million for couples filing jointly in 2018, and the threshold has been adjusted annually for inflation since. With that change scheduled to sunset at the end of 2025, Democrats are turning to reform as part of their focus on the taxation of high-income taxpayers, while Republicans may be looking to maintain the higher threshold or eliminate the tax altogether.

Trump Proposes 15 Percent Corporate Tax Rate — With a Catch - Alexander Riffaat - Tax Notes ($):

Former President Trump said he supports lowering the corporate tax rate only for companies that manufacture products in the United States.

Speaking at an event hosted by the Economic Club of New York September 5, Trump proposed a reduction in the corporate tax rate from 21 percent to 15 percent in order to spur domestic manufacturing.

In the Courts

Unconstitutionality Of Transparency Act Clear, 11th Circ. Told - David van den Berg, Law360 Tax Authority($):

A small business group and one of its members have told the Eleventh Circuit that an Alabama federal judge correctly ruled that the Corporate Transparency Act is unconstitutional, so there was no need for them to demonstrate that the law fails to pass constitutional muster.
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"The district court holding necessarily means that the CTA has no constitutional applications," the brief said. "If Congress lacks constitutional power to enact a federal statute, then that statute is facially invalid and has no constitutional applications."

Government Looks to Supreme Court Social Media Case to Save CTA - Andrew Velarde, Tax Notes($). "The Justice Department and an association of small businesses are trading blows over the applicability of a recent Supreme Court decision on state laws governing social media speech to the Corporate Transparency Act’s (CTA) constitutionality."

Two Sentenced To Prison In $111M Tax Fraud Scheme - Anna Scott Farrell, Law360 Tax Authority($). "Two members of a crime ring who admitted to participating in a $111 million tax fraud scheme involving stealing the identities of accountants and taxpayers were sentenced to prison, according to Texas federal court documents."

Judge Chides IRS, Preparers Over $167M Refund For ID Fees - Anna Scott Farrell, Law360 Tax Authority($). "A D.C. federal judge has declined to approve the IRS' roughly $167 million refund proposal for a putative class of tax-return preparers for charging them excessive fees for special identification numbers, saying the agency failed to address problems the preparers raised with its calculations."

Liberty Global Urges 10th Circ. To Grant $248M Tax Credit - David Hansen, Law360 Tax Authority($):

The U.S. Tax Court improperly applied an Internal Revenue Code provision to some of the $2.8 billion gain from Liberty Global's sale of a Japanese entity, the telecommunications company said in urging the Tenth Circuit to overturn the resulting rejection of a $248 million tax credit.

The Tax Court improperly applied Internal Revenue Code Section 904(f)(3) to categorize the gains beyond offset foreign losses as domestic income, the company told the appellate court in an opening brief Wednesday. Liberty Global contends it is due the tax credit for the foreign taxes it paid on the gain.

Hunter Biden Pleads Guilty To Tax Charges In Surprise Move - Craig Clough, Law360 Tax Authority($). "Hunter Biden entered a surprise guilty plea to nine criminal tax charges in California federal court on Thursday, bringing a dramatic conclusion to the case following a dizzying series of events on what was set to be the first day of his trial."

IRS and Football

IRS Warns Taxpayers Against Dirty Play When Betting on Sports - Nathan J. Richman, Tax Notes($):

IRS Criminal Investigation division special agents are looking for tax evasion and money laundering when taxpayers misbehave with sports gambling.

In a September 5 release and accompanying infographic, CI reminded taxpayers “to wager safely and legally this football season.”

IRS-CI urges taxpayers to play by the rules when it comes to sports betting - irs.gov:

The 2024-2025 football season is here, and fans are betting on NFL and college football more than ever. With nearly 50% of Americans having bet on sports at some point in time, IRS Criminal Investigation (IRS-CI) reminds U.S. taxpayers to wager safely and legally this football season. Illegal gambling activities can result in criminal charges ranging from money laundering to tax evasion.

According to the American Gaming Association, nearly 68 million Americans, a 35% increase from 2023, wagered an estimated $23.1 million on last year’s Super Bowl. The annual revenue from the illegal sports betting market in the United States is estimated at more than $700 million. Between fiscal years 2020 and June 2024, IRS-CI initiated 151 investigations into illegal gambling activity totaling more than $178.8 million and resulting in 71 sentencings with an average prison term of over two years.

IRS News

Companies Urged to Shore Up Defenses as IRS Audits Get Tougher - Caleb Harshberger, Bloomberg Tax($). "Tax authority wins in blockbuster transfer pricing cases this year have captured the attention of multinational companies and their tax advisers worldwide—sparking a scramble to strengthen procedures and defend against more effective federal and state audits.'

IRS Says It’s Collected $172 Million From Wealthy Non-Filers - Erin Slowey, Bloomberg Tax($):

Nearly 21,000 individuals who made over $400,000 but failed to file income tax returns have come forward and paid $172 million in taxes, the Treasury Department said Friday.

The IRS in February said it was going to pursue 125,000 high-income, high-wealth taxpayers who haven’t filed taxes since 2017. It used third-party information such as Forms W-2 and 1099s to identify these taxpayers.

IRS Seeks Comment on Treasury 401(k) Match Contributions (1) - Ben Miller, Bloomberg Tax($). "The Treasury Department and Internal Revenue Service requested comments on Saver’s Match, a SECURE 2.0-mandated program allowing 401(k) savers to receive an annual match contribution of up to $1,000 from the agency, slated to begin in 2027."

What day is it?

National Lazy Mom Day! Is there such a thing? Maybe we should be celebrating Oxymoron Day today too (it is in July).