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This week the House Ways and Means Committee began marking up a tax reform bill to improve equity in our tax system, make modifications to have the system better comport with societal and environmental goals, and generate revenue to cover new spending particularly for infrastructure. The list of changes under review includes several tax measures that were not included in President Biden’s Build Back Better Greenbook. These differences include: The markup (so far) also removed a significant equity proposal from the Greenbook. This missing item (at least at 9/14/21) is the repeal of the step-up in basis at date…
Well, back to what I started with a June 21, 2021 post where I’m sharing my ever-growing list of what I think are necessary but usually overlooked tax changes. It would be terrific to see these in the next tax reform bill or even some picked up in other legislation. I hope you’ll review my first list and this one, check back for future posts (I have more reform ideas on my list) AND please post a comment with your reaction and your tax reform ideas. Reform the personal income tax to its basic framework where reasonable deductions to produce income…
Seven years ago I blogged about California’s new legislation to study a vehical miles traveled (VMT) tax as an alternative to the gasoline excise tax (10/4/14 post). Oregon had already been studying one. In July 2015, a Senate Finance Committee working group – working on tax reform, discussed a VMT in its report on infrastructure in reference to issues with the gasoline excise tax and Highway Trust Fund. Basically, with people driving more fuel efficient cars including electric cars that don’t use any gasoline, not enough money goes to the HTF. And the gasoline excise tax has been…
The recent tourism type travel of well-known billionaires Richard Branson (July 11) and Jeff Bezos (July 20) is a big deal. It also raises tax considerations. I’m talking about tax considerations beyond whether these wealthy owners of space exploration companies (Virgin Galactic and Blue Origin) engaged in any transaction at the height of there journey where the sourcing of the transaction is uncertain. Congressman Blumenauer (D-OR), member of the House Ways and Means Committee announced on July 20 that he will proposed the Securing Protections Against Caron Emissions (SPACE) Tax Act. While the text is not…
Despite better ideas on how to truly help low-income parents of infants, California lawmakers took a route this July that spends a lot of money but doesn’t sufficiently help the group in need of assistance. Why does this happen? There is plenty of data and a 2019 report from the Legislative Analysts Office pointing out that their law change won’t provide as much help as it could have if better designed. I’m talking about what started out in 2019 (SB 92, Chapter 34 (6/27/19)) as a two-year exemption (2020 and 2021) from sales tax for infant diapers and…
The tax provisions included in President Biden’s Build Back Better plan are mostly similar to what he campaigned on, such as repealing tax preferences for fossil fuels and providing tax breaks for most families.  I have posted a table listing the tax provisions in the Administration’s FY2022 Greenbook. There is a lot there relevant to all individuals, wealthy people with lots of appreciated assets, alternative energy companies, oil companies,and more. I think it is also interesting what is not there such as: Limiting the QBI Section 199A deduction for individuals with income above $400,000.  I guess this is because 199A…
I had the honor and privilege to participate with practitioners, tax faculty and AICPA exam staff recently to work on a model curriculum that ties to the next version of the CPA exam, referred to as CPA Evolution. The purpose of the revision is to better reflect how CPAs operate in today’s global, digital environment where accounting, audit, tax compliance and planning, and technology are all important. The exam will have a core that everyone takes with a foundation of accounting, audit, tax, business law, ethics and technology. Then prospective CPAs take one of three discipline exams:  Tax compliance and…
I’ve been maintaining a list for several years of overlooked improvements I think are needed for our federal tax system. I keep adding to the list including based on oddities found in current court cases.  For the next few weeks, I’ll post most of these suggestions. I hope you’ll comment on them and add some of your own. It would be terrific to see these included in any tax reform legislation of the 117th Congress and Biden Administration. Create a de minimus rule for personal use of virtual currency similar to §988(e) for foreign currency which excludes personal gains under…
On May 27, 2021, California Governor Newsom’s “Vax for the Win” program with awards to vaccinated and to be vaccinated Californians provides: $1.5 million to each of 10 individuals $50,000 cash prize for 30 individuals $50 gift cards to the first 2 million individuals vaccinated on or after May 27; prize not awarded until vaccination series is completed. The total cost is $116,5 million. So, what are the tax consequences? Accession to wealth, clearly realized so taxable (§61, §74, and Glenshaw Glass, 345 US 426 (1955)) unless an exclusion applies. Since there are no income limitations for…