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July 2012

It looks like members of Congress decided that spending their annual August recess discussing with voters the possibility of a federal government shutdown wouldn't be much fun. So to make campaigning for their jobs easier, the House and Senate agreed to a funding deal that will keep Uncle Sam operating through March 2013. President Obama is said to have also signed off on the continuing resolution. Without the rare bipartisan deal -- rare not only because Republicans and Democrats have found little to see eye-to-eye on and also because they came to the rapprochement months before the deadline -- the... Read more →

Few things tick people off like taxes and traffic. So combining the two usually isn't a good idea. But some states have decided to take that route. Let's start down the traffic and tax trail in the Peach State. A one cent regional transportation sales tax increase is on today's ballot in 10 Georgia counties. They are, of course, all around the incredibly congested Atlanta area UPDATE, Wednesday, Aug. 1: Georgia voters rejected the transporation proposal. Image courtesy the Untie Atlanta website, which has an interactive map where you can find more about transportation projects that might be paid for... Read more →

Oh my God! Did you hear about Mitt Romney's tax returns? Those exchanges were flying furiously across the Internet this afternoon, sharing the scoop that the infamous computer hacker Anonymous has broken into the Internal Revenue Service's database and obtained more of the Republican presidential candidate's 1040s. Oh my God is right. What did we laugh at before the world went online? Pay attention people: This is so obviously false for so many reasons. First, there's no official Washington response to the supposed online break-in. If such a thing had indeed happened, you can bet the IRS would be in... Read more →

The Cayman Islands are likely to remain a legendary tax haven for the ultra-wealthy from around the world. Private yachts anchored at Grand Cayman courtesy Cayman Islands Tourism But some foreigners who live and work there soon could be paying more to call the Caribbean islands home. Cayman Premier McKeeva Bush has proposed a 10 percent payroll tax on foreign workers who make more than $20,000 in local currency (that's around $24,000 U.S.) a year. OK, like politicians everywhere, Bush (no relation to the U.S. politicos of the same surname) isn't calling it a tax. The official name is "Community... Read more →

When is fair market value not the appropriate valuation for tax purposes? When the Internal Revenue Service says it isn't. The value controversy is part of the tax fight now underway between heirs of New York art dealer Ileana Sonnabend and the IRS. Included in Sonnabend's estate is the Robert Rauschenberg work "Canyon." The piece, described as a sculptural combine, contains a stuffed bald eagle. That's right, the symbol of the United States. Sonnabend got an informal OK from Uncle Sam to hold onto "Canyon" even though the 1940 Bald and Golden Eagle Protection Act and the 1918 Migratory Bird... Read more →

Complex tax issues, both abroad and close to home, were the focus of posts last week at my other tax blog. Some offshore tax shelters got added attention thanks to a British report that at the end of 2010 there was at least $21 trillion hidden in offshore accounts. In fact, said the Tax Justice Network (TJN), that global total might be a conservative estimate. The $21 million is money only, and doesn't take into account real estate, yachts and other nonfinancial assets owned via offshore structures. Adding in those assets, says the TJN report The Price of Offshore Revisited,... Read more →

New York City yoga instructors who've been tied up in knots about the possibility that their sessions would be taxed can relax. Tax officials have determined that yoga isn't officially exercise. Yoga practice by Dmitriy Shironosov via iStock That's not a slam at yoga, which can indeed work up a sweat and help devotees lose weight. I can attest to that. But from a tax standpoint, the no-exercise determination is a good thing. It means that yoga classes are exempt from the Big Apple's sales tax. Earlier this year, sales tax audits of yoga studios were initiated and some feared... Read more →

July is almost over. You know what that means. School's just around the corner. And with it comes the annual spate of back-to-school sales tax holidays. Mississippi kicks off these summer tax-free events today. The Magnolia State's sales tax holiday began at 12:01 a.m. today, Friday, July 27, and runs until midnight Saturday, July 28. As in previous years, Mississippi shoppers won't owe the state's usual 7 percent sales tax on clothing and footwear that costs less than $100 per item. Double check eligibility: Mississippi's Department of Revenue has issued an official list of which items are and are not... Read more →

Got a tax plan? Present it! It's got as much chance of becoming law this year as the one the Senate passed on Wednesday. That's right, the U.S. Senate actually moved a piece of legislation. This is the same body that for months has fallen victim to its procedural rule that allows one side to stymie a bill's consideration because it can't muster the 60 votes required to allow for a straight yes or no vote on a specific issue. But amazingly, yesterday the Republicans didn't fight the vote on the Democrats' tax proposal. Wider tax vote implications: Don't plan... Read more →

Great Britain is trying a new tax collection technique: Shame. Her Majesty's Revenue and Customs (HMRC), the United Kingdom's equivalent of the Internal Revenue Service, wants to embarrass folks who are utilizing (or utilising if you use England's spelling) very aggressive tax shelters into paying more. The idea was sparked by revelations that many of wealthy U.K. residents are using tax loopholes to legally avoid paying HMRC. One estimate is that the country has missed out on up to 14 percent -- or around £5 billion; that's more than $7.7 billion in U.S. currency -- in uncollected taxes. Image courtesy... Read more →

Ah, politicians. Talking is one of the key parts of their jobs, both getting into office and staying there. But sometimes a simple word can be so troubling. Too many of us greatly misunderestimated Dubya's ability with malapropisms. Then there was the infamous attempt by Bill Clinton, usually a master of communication, to tell us what "is" is. And Supreme Court Chief Justice John Roberts and GOP presidential hopeful Mitt Romney each took stabs at whether the Patient Protection and Affordable Care Act insurance purchase mandate is a penalty, fee or tax. Turns out it can be all three depending... Read more →

College football fans are all abuzz about the NCAA penalties handed down today again Penn State University. As in most things sports, and especially at the ultra-emotional college level, the reactions from opposing sides are loud and clear. The boos from Penn State apologists include the complaint that NCAA President Mark Emmert has overstepped his authority, inserting the college sports oversight body into criminal proceedings. Worse, they say, he didn't wait until all legal action has run its course. And, argue Penn Staters, the penalties will punish not those who committed unspeakable crimes, but current and future Happy Valley students... Read more →

Congratulations to Bradley Wiggins, the first British rider to capture the Tour de France. Riding a bike for miles and miles over mountains and in bad weather is Wiggins' job. But a lot of folks also use their two-wheelers to get to their jobs. They're not likely won't receive the same accolades as those bestowed each July in Paris, but these two-wheel aficionados might be eligible for up to $20 per month tax-free from their employers. This workplace fringe benefit amount also is this week's By the Numbers figure. The boss' role: The biggest obstacle on this tax-free benefit is... Read more →

It's been a blog maintenance day, and since I'm not a good house (or blog) keeper by nature, when I do take the time to shine up something, I want to make sure it's noticed. Now you know what the hubby has to put up with when I finally clean the stove top or dust a room! So I'm taking a few sentences to point out the Weekly Tax Tip has finally been updated. Yep, that's new information over there in the upper right column. At least in the blog's case, my upkeep lasts a bit longer than my domestic... Read more →

As I just mentioned, I was at the IRS Nationwide Tax Forum in San Diego last week. But while more than a thousand tax practitioners and a few stray tax geeks like me gathered in Southern California, taxes continued to make news in the rest of the country and were so noted last week at my other tax blog. Some tax watchers marveled at how state lawmakers from both political parties have found common ground. Democrats and Republicans in U.S. statehouses have worked out deals for online retail giant Amazon to collect state sales taxes. That's not really so surprising.... Read more →

Last weekend I was getting ready to head to San Diego for that city's IRS Nationwide Tax Forum. I'm not a good traveler. Even when it's somewhere I want to go, and this was, I tend to put off getting ready to go until the last minute. That's my excuse story for missing my regular last week at my other tax blog entry last weekend and I'm sticking to it. But it's also led to double duty this weekend. And since I'm already behind, let's get to it for the week of July 9 through 13. That week began with... Read more →

"Should our tax voyeurism really be allowed to supersede the right of tax privacy we all enjoy? I don't think so." I wrote that last fall after actor Alec Baldwin and a New York state senator got into a public spat via Twitter about making personal tax returns public. I was wrong. Back then, my main arguments were (a) that most candidates don't do their own taxes so their filings offer no insight as to their personal understanding of the tax code or their ability to fill out the forms and (b) "you can be sure that if returns are... Read more →

Two American corporate giants have decided to pass up an Olympics tax break. Olympic Park in London will be a tax haven for the duration of the summer games thanks to special tax rules included as part of the original bid. That means sponsors could pay no tax at all on earnings generated in the Olympics. But McDonald's and Coca-Cola say they will pay tax on the money they earn in connection with the U.K.-based competitons, reports Calum Fulkler in Accountancy Age. Her Majesty's Revenue and Customs says the tax break is available to all foreign nationals. This includes not... Read more →

Sure, life sometimes imitates art or vice versa. But in seeing political connections in the much-anticipated new Batman movie, Rush Limbaugh has gone a bit batty, even for him. The conservative talk radio host is convinced that a liberal Hollywood/Obama conspiracy is behind the name of the latest Batman supervillian. In what Comedy Central's Jon Stewart characterized as "a bit of divine intervention" for political comedians, The Dark Knight Rises pits Batman against the evil Bane. Limbaugh, however, doesn't see it as coincidence. It is, he told his listeners, a concerted attack against presumptive Republican presidential nominee Mitt Romney, who... Read more →

The Supreme Court ruling on the constitutionality of the health care act, known as the Patient Protection and Affordable Care Act of 2010 if you're into formal titles or Obamacare if you're a bit more casual with legislative nomenclature, continues to reverberate. The high court's split decision -- the individual mandate is OK, but states can't be forced to participate in the health care law's expanded Medicaid program -- is causing problems for some states on both political and financial fronts. The Medicaid expansion is expected to extend coverage to roughly 15 million low-income people. But that number will be... Read more →