Photo courtesy Vaping360.com In just more than six months, San Francisco will become the first U.S. city to ban vaping. The city's Board of Supervisors voted unanimously on June 25 to outlaw the sale, distribution and manufacturing of vaping products. The ban is scheduled to go into effect Jan. 1 2020. It will last at least until the federal Food and Drug Administration reviews the safety of e-cigarettes. That, according to some estimates, could take another three years. The six-month delay is designed to give retailers time to remove the product, which is increasingly popular with younger people, from their... Read more →
Politics
National Taxpayer Advocate Nina E. Olson, shown here in a screen shot from an earlier C-SPAN appearance, takes parting shot at 'woefully inadequate' IRS customer service in her final report to Congress before she retires in July. Nina E. Olson is nothing if not consistent. The problem for taxpayers with this trait is that it means much of the change to and improvement of the Internal Revenue Service that Olson has championed for almost two decades remains unfinished. Olson is the National Taxpayer Advocate (NTA), at least for another few weeks. She was appointed to the IRS oversight post in... Read more →
House Ways and Means Chairman Rep. Richard Neal (D-Massachusetts) opens today's (June 20, 2019) hearing on tax extenders and disaster tax relief. (Screen shot of official W&M YouTube hearing). UPDATE, June 21, 2019: After almost more than 11 hours of discussion, the House Ways and Means Committee on Thursday, June 20, passed along a 25-to-17 party-line vote a measure to extend through 2020 a variety of tax breaks that expired in 2017 and 2018 or will expire at the end of this year. The bill also provides tax relief for those who affected by certain major natural disasters. The House... Read more →
When it comes to expired tax laws, Congress is in much the same situation as the builders of this unfinished bridge. The basics are there, but there's still work to be done. (Photo by Paul Mannix via Flickr CC) UPDATE, June 21, 2019: After almost more than 11 hours of discussion, the House Ways and Means Committee on Thursday, June 20, passed along a 25-to-17 party-line vote a measure to extend through 2020 a variety of tax breaks that expired in 2017 and 2018 or will expire at the end of this year, some of which are highlighted in this... Read more →
Image courtesy SimpsonsWorld via Giphy.com The IRS reform bill could not have come at a better time, based on a recent report from the federal tax agency oversight office. The Treasury Inspector General for Tax Administration (TIGTA) found that the IRS gave its taxpayer telephone assistance program better grades than it deserved. IRS customer service improvements planned: Each year, millions of taxpayers call the IRS toll-free telephone assistance lines seeking help to understand the tax laws and meet their tax obligations, notes TIGTA. Telephone assistance is one of the agency's crucial customer services, but the methods the IRS uses to... Read more →
IRS building photo by Kari Bluff via Flickr CC The Taxpayer First Act, which is awaiting the president's signature to become law, got a lot of attention for what wasn't in it. The controversial section that would have codified the Free File Alliance was removed in the bill's revised House version, which was approved by voice vote in that chamber on June 10. Three days later, the Senate approved the reworked bill, also by voice vote, and sent it to the White House. Opponents of the formalized Free File section argued that it would have prohibition the Internal Revenue Service... Read more →
Rep. Richard Neal (D-Massachusetts), chairman of the Ways and Means Committee (top row, center), is looking to renew at least some expired tax provisions, known as extenders. The ranking Republican on the House tax-writing panel, Rep. Kevin Brady of Texas (top row, right) is not impressed with Neal's proposal. (Photo courtesy House Ways and Means Democrats Facebook page) Is it finally the end for extenders? Yes, no or maybe, depending on who you ask. Many members of Congress on both sides of the aisle say enough is enough with the perpetually renewed technically temporary tax breaks known as extenders. They... Read more →
Checking out food bank offerings. (Photo by Michael Losch-KOMUnews via Flickr CC) All of us here in Texas, especially lovers of Mexican beers and avocados, are breathing a bit easier now that the threatened tariffs on our Southern neighbor are, for now, off the table. The Chinese trade situation, however, is still simmering. As that standoff continues, American shoppers are paying higher prices for many consumer goods. That's because tariffs essentially are taxes. The higher prices we're already seeing due to the Chinese charges could go up even more if the self-proclaimed Tariff Man holds firm in his belief that... Read more →
Rep. Kevin Brady (R-Texas), chairman of the House Ways and Means Committee when his party pushed through tax reform in December 2017, celebrates in June 2018 the six-month anniversary of the Tax Cuts and Jobs Act. A new Congressional report, however, doesn't have much positive to say about the new tax law's first-year economic effects. During the rushed, ahem, debate of the Tax Cuts and Jobs Act (TCJA) in late 2017, its Republican sponsors touted the bill's economic benefits. The cuts to U.S. businesses would prompt more domestic investments. Workers would get bonuses and/or raises. This would speed up the... Read more →
The Alchemist, an 80-foot motor yacht photographed by D Ramey Logan, would qualify for a substantial sales tax break under a new Texas law awaiting the governor's signature. (Photo via Wikimedia Commons, Creative Commons Attribution-ShareAlike 4.0) Texas lawmakers say the property tax reform bill they've sent to Gov. Greg Abbott's desk will slow the increases homeowners have complained about for years. The Texas Property Tax Reform and Transparency Act, which if enacted will require cities, counties and other taxing units to get voters' OK before levying new taxes. We shall see if what's been worked out on paper in Austin's... Read more →
Donald J. Trump is golfing this Memorial Day weekend, this time with Japanese Prime Minister Shinzō Abe during Trump's visit to that nation. (Photo courtesy Japan Prime Minister Instagram account) Memorial Day weekend obviously is about honoring the men and women who died in service to our country. But it's also a major recreational weekend. Folks will be taking time to spend with family and friends and, in many cases, enjoying their favorite avocations. For some, that's a round of golf, not to mention a few rounds at the 19th hole. Trump's links love: Golf gets a lot of attention... Read more →
Gold Star families aren't the only ones facing unexpectedly higher taxes under kiddie tax changes in the Tax Cuts and Jobs Act (TCJA). Some students who receive college scholarships or grants now face bigger tax bills, too, under the tax reform law that took full effect in 2018. Previously, scholarships or grants for nontuition expenses like room and board were taxed at the same marginal rate that the students' parents paid. That meant lower- and middle-income students generally paid lower tax rates on the educational financial assistance. But the TCJA now applies the higher trust and estates tax rate, which... Read more →
Memorial Day, our annual remembrance of the men and women who died while serving in the U.S. Armed Forces, is just a week away. Many members of Congress will be back home on May 27 taking part in Memorial Day ceremonies honoring military personnel for their ultimate sacrifice. But before then, Senators and Representatives are focusing how to correct a provision in the Tax Cuts and Jobs Act (TCJA) that has caused some military heroes' families to face higher tax bills. TCJA advocates, who hurried the Republican-written tax reform through Congress in late 2017, say the revisions to the so-called... Read more →
A big part of companies' federal tax responsibilities is paying employment taxes for their workers. These are the Social Security, Medicare and unemployment taxes on those employees' wages. However, when it comes to workers who are hired as contractors, it's the worker who's totally responsible for these taxes, in addition income tax withholding via estimated tax payments. That's why, when appropriate and fiscally feasible, many firms try to hire independent contractors. Sometimes, though, the line between employees and contractor is fine. It's facts and circumstances in each case when deciding how to classify a worker. And if the Internal Revenue... Read more →
"The Witch Trial," an 1848 painting by William Powell Frith via Wikimedia Commons Witch hunt. It's been one of Donald J. Trump's favorite phrases for more than two years. He's used the term 310 times, according to Factba.se, the website launched in January 2017 by Virginia husband and wife team Bill Frischling and Jennifer Canty as a way to track and share all of Trump's utterances, be they verbal, written or, most frequently, on social media. The last time Trump invoked witch hunt to decry investigations linked to him was in a Tweet the afternoon of May 12: ....employment numbers... Read more →
The Internal Revenue Service has formed a working group to look into allegations that some of its Free File members really didn't (don't?) want taxpayers to file for free. State and city officials have launched official investigations into or taken legal steps in connection with allegations that some tax software companies redirected online searches away from their free options on at the IRS website. Now what is being hailed as the first nationwide class-action lawsuit in the matter has been filed against Intuit, the maker of TurboTax. Tax software giant is legal target: It's no surprise that the tax software... Read more →
Photo by vxla via Flickr CC If gratuities are part of your work, then the 10th of the month is an important tax date for you. It's the day — or the next businesses day if the 10th falls on a weekend or holiday — that you must report your tip amount for the previous month when it totals $20 or more. The Internal Revenue Service requires these reports because the tax code considers all types of tips as discretionary, fully taxable income. Wisconsin workers, however, may soon get a break on the state tax level when it comes to... Read more →
Free File is finally getting a lot of attention. Unfortunately for companies involved in the Internal Revenue Service/tax software partnership, it's not the kind of attention they want. The IRS now is following state officials in California and New York in looking into whether potential Free File users were intentionally directed away from the program. Free but not that popular: Free File, as the name indicates, was designed to allow most taxpayers access to no-cost online tax return completion and electronic filing. The 2019 filing season is its 17th. It's still available to taxpayers through the Oct. 15 extended filing... Read more →
Around two dozen tax breaks are now in a legislative zombie state, much like these creatures in George Romero's classic zombie film "Night of the Living Dead." The tax versions are waiting for federal lawmakers to bring them back to life or finally and completely put an end to them. (Photo via Wikimedia Commons) A dozen groups spanning the political spectrum are urging Congress to let zombie tax extenders remain dead. Are you still waiting on expired tax provisions to be resurrected? If a motley crew of public policy, tax and advocacy groups get its way, you'll be waiting forever.... Read more →
Today is the start of the annual Small Business Week. And yes, you can combine it with Cinco de Mayo and raise a margarita to your favorite entrepreneur. These 30 million or so smaller companies are hailed as America's backbone. Approximately 10 million are women-owned, 29 percent are minority-owned and nearly 10 percent are veteran-owned. Running a small business has never been easy. In fact, their size tends to put more pressure on such operations. Profit margins are thin. The ability to offer benefits to workers is stretched. And small companies tend to be more at the mercy of the... Read more →