Tax Update Blog: September 2005 Archives
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TAX COURT POPS NELIGH, NEBRASKA REAL ESTATE BUBBLE
September 30, 2005
Forget Manhattan, London or Tokyo. If the tax return filed by a Nebraska LLC is to be believed, the world's hottest real estate market was Neligh, Nebraska. The partnership bought 30 acres there for $75,000 in May 1997. 17 months later they donated it to a religious order and claimed a $475,000 fair market value charitable deduction.
Hottest real estate market of the 1990s?
The Tax Court cooled that market down yesterday, ruling that the value of the property was $76,200 on the date of donation. The Tax Court found the IRS appraiser, the county assessor, and the actual sale price 17 months earlier better indications of value than the taxpayer's appraisal.
Interestingly, no penalties were assessed, even though the tax law provides a 40% penalty for gross valuation overstatements. That means the taxpayer appraisal was at least good enough to fend off the penalties.
Cite: Wortmann, et. al. v. Commissioner, T.C. Memo 2005-227
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IOWA MATCHES FEDERAL HURRICANE DEADLINE RELIEF
September 30, 2005
Iowa will match federal return and payment relief for taxpayers in the Katrina and Rita hurricane disaster areas, according to a news release issued this week. This means affected taxpayers have until February 28, 2006 to file Iowa returns and pay Iowa taxes due since the hurricanes struck. The Iowa relief start date is the same as for the federal relief.
Link: Summary of IRS Katrina relief.
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SHELTER SETTLEMENT CAUSES CONTROVERSY
September 30, 2005
A proposed settlement of lawsuits relating to the 1990s tax shelter craze was announced yesterday. The New York Times reports:
The accounting firm KPMG and a law firm have agreed to pay $195 million to as many as 280 wealthy investors who bought four types of questionable shelters, the first major step by the two firms to deal with billions of dollars in potential civil claims.
The settlement relates to tax shelters that led to recent indictments.
The settlment may be controversial, according to the Times:
At least one law firm representing tax shelter investors, Bernstein Litowitz Berger & Grossmann in New York, said yesterday that it intended to oppose the class-action civil settlement.
The firm said it did not like how the terms of settlement created four groups of class members, depending on the size and timing of their claims. Under the terms, class members can receive as little as 12½ percent of their losses or as much as 130 percent. The law firm also objects to the undisclosed payments to be made to a special master who will decide which groups class members belong to.
Link: NY Times article
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SECTION 409A DEFERRED COMP PROPOSED REGULATIONS ARE ISSUED
September 29, 2005
The Treasury has issued the long-awaited Sec. 409A proposed regulations. Practitioners have been waiting on these rules to fill in the gaps left by Congress in the 2004 deferred compensation legislation.
The press release for the new regulations says that the "documentary compliance" deadline has been rolled back to December 31, 2006. This apparently means that while taxpayers have to obey these rules in running their deferred compensation plans in 2006, they don't have to get their plan documents updated until the end of next year.
Section 409A is Congress's fire-into-the-crowd response to the deferred compensation abuses of the 1990s seen in Enron and other companies. Failure to follow the new rules -- timing of deferred compensation elections, hardship withdrawals, and other operational aspects of non-qualified deferred compensation -- leads to retroactive taxation of amounts deferred and a 20% penalty tax on the employee.
Links:
UPDATE: 238 pages. Ugh.
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DOES THIS MEAN HOGWARTS COULD QUALIFY FOR "LIFETIME LEARNING CREDITS?"
September 29, 2005
The witchcraft and wizarding academy featured in the Harry Potter series wouldn't qualify for U.S. college-tuition tax breaks - it covers junior-high and high-school level, rather than college. But in Europe, witchcraft schools do qualify for tax breaks:
A Dutch actress training to be a witch is eligible for a tax deduction for her course fees, the tax authorities in the Netherlands have decided. They allowed the 39-year-old woman to claim 2,210 euros (£1,505) for the course that lasts a year and a day.
A tax official told Reuters news agency the woman used the course "to extend her professional knowledge." Students learn to cast spells, prepare herbs and potions and use crystal balls as well as other aspects of witchcraft.
Of course, some witchcraft schools in the U.S. already qualify for tax breaks...
Via the Tax Policy Blog.
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TAXES TAKE A BITE OUT OF THE TRIB; CUBS LOSE
September 29, 2005
Fallout from the Tax Court in the Chicago Tribune today:
Tribune stock tumbles on ruling
Tribune Co. shares fell to a four-year low Wednesday as the company said it would scale back its stock repurchase plan a day after a U.S. Tax Court judge ruled against it in a $1 billion dispute.
And:
Decision may thwart some transactions
Tribune Co.'s loss in U.S. Tax Court garnered widespread attention Wednesday among corporate tax specialists because of the big dollars involved and the legal decision's potential consequences on future merger activity.
Accountants and tax lawyers were still dissecting the 135-page opinion, which was issued late Tuesday. But based on their initial readings, some speculated that the ruling could have a chilling effect on certain types of tax-free transactions, though it should not slow down the overall pace of dealmaking.
But for Tribune-owned businesses, catastrophe is just another day at the office:
Cubs aptly fail to bring it home
With raindrops falling and the ballpark half-filled Wednesday, the 2005 Cubs bid adieu to Wrigley Field in their own inimitable style.
A Nomar Garciaparra throw to second base bounced off a Pittsburgh runner's helmet and led to two unearned runs off Mark Prior. They went 0-for-8 with runners in scoring position. To cap things off, the Cubs failed to score the tying run in the ninth, despite loading the bases with no outs. Corey Patterson and Ben Grieve struck out before Jose Macias ended the game by popping out
Prior coverage:
MORE ON TRIBUNE COMPANY'S BLOWN REORG
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MORE ON TRIBUNE COMPANY'S BLOWN REORG
September 28, 2005
As we mentioned yesterday, the Tax Court has added $1.3 billion to the Tribune Company's 1999 taxable income by ruling that the sale of Matthew Bender by its Times-Mirror subsidiary did not qualify as a tax-free reorganization.
The case has gotten some big-media attention. The TaxProf has a roundup and links.
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SUPREME COURT TO HEAR CUNO
September 28, 2005
The U.S. Supreme Court agreed to hear the Cuno case on state tax incentives. The Sixth Circuit decision disallowed state tax incentives Ohio granted to Daimler-Chrysler.
The court hinted that it may sidestep the Commerce Clause issues raised by the Sixth Circuit. It requested briefs on whether the plaintiffs have standing to challenge the credits. If the court finds that the Cuno plaintiffs weren't entitled to bring the suit in the first place, the decision would probably be vacated.
It would be nice if Congress would step in and stop the states' beggar-thy-neighbor competition to subsidize well-connected businesses. A dismissal of the case on jurisdictional grounds would take the heat off Congress and allow the states to continue their circular firing squad corporate welfare competition.
The TaxProf Blog has coverage and links.
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GENIUS FAILS TO AVOID TAX PENALTIES
September 28, 2005
So many things have not worked out for the super hedge fund Long-Term Capital Management. The fund, set up by some of the greatest minds in finance, triggered a worldwide financial crisis when it faced a liquidity crunch in the 1990s. Its story is told in the book "When Genius Failed."
Yesterday the Federal Second Circuit Court of Appeals upheld penalties of 20% for substantial understatement of income and 40% for gross valuation misstatement on LTCM for a leasing tax shelter it used when it was making money. The shelter itself was shot down in a decision last year; the fund appealed only the penalties, saying it relied in good faith on its tax counsel, King and Spalding, and should therefore be excused from the penalties. The appeals panel disagreed:
The district court found no credible evidence that Long-Term received the tax advice from K&S on which it claimed to have relied in reporting the $106 million loss on its tax return because Larry Noe's memo addressed only the allocation of the loss and Noe's testimony concerning his April 14, 1998 conversation with Mark Kuller was "vague" and "inconsistent." See Long Term Capital Holdings v. United States, 330 F. Supp. 2d 122, 207 (D.Conn. 2004). The court also found that even assuming, arguendo, that Long-Term had received relevant tax advice prior to filing its return, it had failed to demonstrate that K&S's advice was based upon all pertinent facts and circumstances and did not unreasonably rely on statements that the taxpayer knew were unlikely to be true. See Treas. Reg. § 1.6664-4(c)(1) (stating the two threshold requirements a taxpayer must satisfy in order to show that it relied on advice reasonably and in good faith). Long-Term directed K&S to assume that Long-Term entered into the transaction with Onslow Trading & Commercial LLC ("OTC") for a valid and substantial business purpose independent of federal income tax considerations, that it reasonably expected to derive a material pre-tax profit from this transaction, and that there was no preexisting agreement on the part of OTC to sell its partnership interest to Long-Term Capital Management ("LTCM"). The record provides ample support for the district court's finding that Long-Term knew these assumptions to be false and that it was unreasonable for K&S to rely on these assumptions when a reasonably diligent review of the pertinent facts and circumstances would have revealed them to be false. The district court was similarly justified in finding that Long-Term's decision to report the $106 million loss as a "Net Unrealized Gain" on line 6 of Schedule M of its 1997 tax return did not constitute "good faith" within the meaning of Treas. Reg. § 16664-4.
(Emphasis added.)
Burying a loss on the book-tax reconciliation as "Net Unrealized Gain?" Genius failure, indeed.
We discussed the pattern of this tax shelter in this post: BUILT-IN LOSSES - HERE TODAY, GONE TOMORROW UNDER THE NEW LAW
Links: District court decision
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RITA BLOWS DUE DATES INTO NEXT YEAR
September 28, 2005
The IRS announced (IR-2005-110) that taxpayers in the Hurricane Rita disaster area will have until February 28, 2006 to file tax returns and pay taxes due starting September 23, 2005. This is the same extended date that applies to the Katrina disaster area.
Counties affected are:
Texas: Chambers, Galveston, Hardin, Jasper, Jefferson, Liberty, Newton, Orange and Tyler.
Louisiana: Parishes of Acadia, Beauregard, Cameron, Calcasieu, Iberia, Jefferson Davis, Lafayette, St. Mary and Vermilion.
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GOOD THING THEY DUMPED SAMMY SOSA
September 27, 2005
The Tribune Company today lost a Tax Court case with stakes that dwarf even a George Steinbrenner payroll. The Court ruled that the company, owners of the woebegone Cubs, must recognize a $1.3 billion gain on the 1998 sale of legal and tax publisher Matthew Bender. That means the Trib will have to pony up about $551 million, plus interest, unless it gets the case overturned on appeal.
While I haven't had time to analyze the transaction, which apparently was structured by Price Waterhouse, the Tax Court ruled that the deal failed to qualify as a Sec. 368(a)(2)(E) reverse subsidiary merger. By failing to achieve tax-free reorganization status, the transaction ends up being a taxable stock sale similar to the pending Maytag deal.
More on this after I get to spend more time with the 135-page opinion.
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CAPITALIST OKTOBERFEST
September 27, 2005
The Carnival of the Capitalists is up at AnyLetter. Among the many fine economics and business postings in this weekly roundup is the InsureBlog's discussion of employee assistance plans.
Also, disreputable-looking but smart law Professor Stephen Bainbridge uses the controversy over Senate Majority Leader Bill Frist's sale of HCA stock to explore some issues in the law of insider trading.
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TAX FOUNDATION TO TARGET MOM, APPLE PIE?
September 27, 2005
Why not, if they can take on the home mortgage interest deduction:
What's the economic case against it? Simple: by giving a tax subsidy to housing, it distorts investment decisions toward houses and away from assets like factories and equipment that are more productive at the margin. And that makes workers less productive, ultimately lowering wages and making society poorer.
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TELL US HOW YOU REALLY FEEL
September 27, 2005
Some find the indictment of national accounting firm partners disqueting. Not law prof Calvin Johnson.
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ARE YOU A HAPPY TAX FILER?
September 27, 2005
The IRS has studied taxpayer attitudes towards return filing. Professor Maule has some thoughts:
Only 26% (down from 33% the previous year) call the IRS "a friend." Wow, some people are very, very lonely.
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DES MOINES REGISTER: "REPEAL JOB-KILLING CORPORATE TAX"
September 27, 2005
Yesterday's editorial in
Part of restoring America's competitiveness should be to repeal the tax.
Don't merely trim it. Don't put more loopholes in it. Get rid of it.
Yet the Register has, if belatedly, recognized:
In reality, corporations don't pay taxes. Only people do. The taxes paid by corporations are passed on to individuals in the form of higher prices for products, lower wages for workers or smaller dividends for shareholders. Much of the revenue lost by repealing the corporate income tax would theoretically be recouped in the taxes on higher incomes of workers and shareholders.
IS IT GOOD POLICY?
The Register approaches the issue with the goal of boosting American Manufacturing. This goal seems a bit misdirected; it that economic prosperity should be the goal, not manufacturing for its own sake. Still, good policy is good for industry, too, so we won't quibble.
The only practical difficulty with repealing the corporate tax is that it could undermine the individual tax base and create its own distortions. If corporations can avoid having their income taxed by not distributing it, dividends will become rare. Unless the country goes with a full-blown consumption tax, where dividends and interest aren't taxed, a corporate tax repeal would create such tax-sheltering problems that the repeal wouldn't last.
A better solution may to retain the corporate tax, but to make dividend payments to shareholders fully deductible. That would avoid the tax-sheltering problems of full repeal while eliminating one of the two layers of tax on corporate earnings. It would also probably be better for the economy; it strikes us as unwise to have a system that encourages captains of industry to have lots of cash sitting around for no other reason but to avoid taxes.
We would couple this system with an excise tax to be withheld on distributions to tax-exempt entities, but to make up for lost revenue and to ensure that the income gets taxed somewhere along the line.
HOW ABOUT AN 'IOWA-ONLY' REPEAL?
One of the joys of our federal system is that states can be "economic laboratories." Iowa's corporate income tax raises a paltry share of the state's tax revenue, in spite of it's highest-in-the-nation 12% top rate. While the Register has little influence the national tax policy debate, it still has clout in Iowa. Repealing Iowa's corporate taxes, either outright or via full dividend deductibility, could be worth more in economic development that all the Grow Iowa Values credits you could shake a lobbyist at. Go for it, Register.
RETURNING TO NORMALCY
Today's editorial brings the Register editorial page staff back to ground they surely find more comfortable -- government-run health care:
Studies show that a universal, government-sponsored system — similar to those in every other industrialized nation — could cover everyone in America for about the same amount Americans now pay for a disjointed, job-based system. The bonus: It would improve the competitive position of American manufacturers.
It seems to us that individuals, rather than governments, should be the health-care decision-makers. As Canada has learned the hard way, government health-care becomes the right to get on a waiting list for treatment, rather than a right to treatment itself.
Link: "Does anyone know if they are handing out parkas in hell?"
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BABYSITTERS: A BARGAIN AT ANY PRICE?
September 26, 2005
We have stumbled accross "footnoted.org," a blog that lives on a study diet of accounting statement footnote disclosures. Today they offer up this gem:
What’s the going rate for babysitters in your area? Here in suburban New York, it can run as high as $15 an hour. But in Omaha, which last I checked wasn’t exactly a high cost metropolis, the going rate seems to be considerably higher based on an exhibit to an 8-K filed by Con-Agra (CAG) late Friday. The company has agreed to pay its outgoing Chairman and CEO Bruce Rohde $50K a month to essentially babysit incoming Chairman Steven Goldstone. That’s in addition to the stock options and restricted stock that vest immediately as well as the office space, secretarial support and health insurance for Rohde and his dependents.
Since the arrangement, which begins Oct. 1, lasts for four years, one would think that Goldstone is some novice in need of lots of hand-holding. But a closer look shows that Goldstone is not only the former Chairman and CEO of RJR Nabisco, but he’s also been sitting on Con-Agra’s board since December 2003.
Nice work if you can get it.
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UNOFFICIAL 2006 TAX RATE TABLES ISSUED
September 26, 2005
Northern Illionois University professor James Young has issued his annual sneak preview of 2006 inflation adjusted tax rates via Tax Analysts, which has made them freely-available here. Mr. Young also has computed the adjusted standard deductions, exemption amounts and exemption phase-outs.
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WHERE "TARGETED" TAX BREAKS GET AIMED
September 26, 2005
David Brunori tells a little tale of "targeted" tax breaks at State Tax Notes today (unfortunatly it is behind the subscriber firewall). It is set in Massachussetts, but its lessons apply anywhere politicians invoke the magic words "economic development."
It seems that Massachussetts passed a series of income and property tax breaks to "help blighted neighborhoods." Mr. Brunori tells how widespread blight turned out to be:
One recipient of the tax credit, Affiliated Managers Group Inc., received $1 million in corporate income credits -- plus additional property tax breaks -- for developing its headquarters in Beverly, Mass. Let's forget for a moment that Beverly is one of Massachusetts's wealthiest areas. Beverly has a median family income of $67,000 a year, compared to $40,000 for the United States.
And the blight spread:
Manulife, a Canadian insurance company with a market cap of $44 billion and $26 billion in revenue, received a tax credit for property in South Boston's seaport district. That area of Boston is the opposite of blighted.
How did "blight" relief get funnelled to areas where no blight had been apparent? It's not entirely clear, Mr. Brunori points out some suggestive connections:
... Republican Lt. Gov. Kerry Murphy Healey's husband, Sean, is the CEO of Affiliated Managers Group, a beneficiary of the credits. Affiliated received the credits before Healey became Romney's second in command (and before Romney became governor). But Affiliated is a rich company ($3 billion in capital worth, $800 million in revenue). Sean is a pretty rich guy himself (he earned $3.3 million last year and just sold $13 million in stock options). And everyone knows Kerry Healey would like to run for governor next year. Oh -- the chair of the Massachusetts Republican Party, Darrell Crate, is also the chief financial officer of Affiliated.
Targeted tax breaks tend to flow to the well-connected, of whatever party. The rest of us get to subsidize them. If you want to promote the economic development of the well-connected party (a bi-partisan group), then targeted tax breaks are just the thing. If you want to benefit the whole state, you eliminate the credits and lower rates for everyone.
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SQUANDERING SYMPATHY
September 26, 2005
Americans are generous. Louisiana's senators seem determined to see if their countrymen are also gullible (via Taxable Talk):
According to this story, Louisiana's senators have asked for $250 billion in aid solely for the state of Louisiana. That's an interesting number given that current estimate of damage is $200 billion.
For some historical perspective, the entire Louisiana Purchase cost about $229.5 billion in 2005 dollars ($14 million in 1803). That got us Louisana and all or part of 14 other states. It seems wrong to pay for it again.
Instapundit has more.
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BUT WE MIGHT SOON BE FIRST IN ARTIFICIAL RAINFORESTS
September 23, 2005
Iowa is dead last on Entrepreneur Magazine's list of "Hot" states for entrepreneurs in 2005.
From the Des Moines Business Record daily e-mail news briefing:
Iowa is ranked as the worst state in the country for small business, according to a recent study, with Des Moines ranked 36th out of 55 mid-size cities and several other Iowa communities listed near the bottom in the small-cities rankings...
Iowa was ranked 50th in the two categories that determine overall rank: young company rank, the number of companies within an area that started four to 14 years ago and have at least five employees; and rapid growth rank, the measurement of a company's job growth that accounts for both absolute and percentage change in employment.
Cedar Rapids ranked 41st out of 171 communities in the small city category. Iowa City, the Quad Cities, Waterloo-Cedar Falls and Sioux City were ranked 120th, 126th, 147th and 157th, respectively.
Ugh. I want a drink. And maybe a state tax system that isn't a pinata for the well-connected. Oh, and I want spinner hubcaps, too.
LINK: Iowa's Soylent Green Tax Proposal
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TAX POLICY BLOG WHIPLASH: TARGETED TAX BREAKS ARE HARMFUL AND NECESSARY?
September 23, 2005
One of the enjoyable aspects of reading group blogs is when two authors make posts at cross purposes. It happened yesterday at the Tax Policy Blog.
Andrew Chamberlain posted a nice piece that makes a persuasive case of how targeted tax breaks, however well-intended, increase rates for everyone by narrowing the income base subject to tax:
(Source: Tax Policy Blog)
Later in the day his co-blogger Chris Atkins placed a post on the importance of targeted tax breaks to Katrina recovery. He argued that the Sixth Circuit's Cuno decision to limit corporate welfare targeted tax breaks would tie the hands of states in recovering from disaster.
I'm no lawyer, and perhaps Mr. Atkins is correct when he says that Cuno is incorrect as a matter of law. As a matter of policy, though, Cuno's assault against targeted tax breaks is well-supported by Mr. Chamberlain's post. All of the targeted tax credits in the world won't make investment in Louisiana (top rates: 6% personal, 8% corporate) competitive with neighboring Texas (top rates: 0% personal, 4.5% corporate "franchise" tax). Louisiana would do a lot better with low rates for everyone than with tax subsidies for those with good connections to their super-competent state government.
LINK: All Tax Update Cuno coverage
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DOING THE BASIS HOKEY POKEY
September 23, 2005
We recently told the story of S corporation shareholders who loaned their S corporation money for a few days at the end of the year and, based on the loans, were allowed to deduct their S corporation losses for the whole year. While the taxpayers in that case (Brooks v. Commissioner) won, we didn't think it a good idea to follow their example:
Notwithstanding the taxpayer victory here, we normally wouldn't advise taxpayers to put large amounts of cash into an S corporation right before year-end to take losses and then withdraw it right after year-end. The IRS has other tools they could use to attack such short loans, and those attacks might succeed under other circumstances. They might attack the loan as lacking substance, for example...
THE "OTHER CIRCUMSTANCES" DEMONSTRATED
Mark Kaplan couldn't use about $800,000 in losses in 1996 because he had no basis* at the end of the year in his wholly-owned S corporation, Marc Construction and Development Co. (MCDC)
He wasn't going to let that happen in 1997. He arranged to borrow $800,000 from a friendly banker on December 29, 1997, which he promply deposited in his account at friendly bank. On the same day he wrote a check for $800,000 to MCDC. The S corporation moments later loaned the $800,000 to two other S corporations owned by Mr. Kaplan; they deposited the checks in their own accounts at friendly bank. Nine days later, Mr. Kaplan "borrowed" $800,000 from the two other S corporations, which he then used to pay off the friendly bank loan.
Based on this 11-day loan sequence, Mr. Kaplan thought he could deduct in 1997 the losses he missed in 1996. He reported his returns showing that he had $800,000 in basis in a loan to MCDC.
SUBSTANCE-FREE SINCE DECEMBER 1997
The Tax Court didn't buy it; they said there was no real substance to the loans:
Similarly, petitioner’s purported loan to Marc involved no actual economic outlay. In this case, as in Oren v. Commissioner, T.C. Memo. 2002-172, the various disbursements between the taxpayer and his S corporations were “the equivalent of offsetting bookkeeping entries, even though they occurred in the form of checks”. The loan proceeds originated and ended with the Bank. The Bank loan as “collateralized” with $800,000 that Lakeview and Pleasant Prairie deposited in their Bank accounts contemporaneously with the Bank loan. In effect, then, the Bank loan proceeds constituted the collateral for the Bank loan. As far as the record reveals, the loan proceeds never left the Bank in the 11 days between the time the note was created and the time it was paid off.
Bottom line: the loan didn't work and the losses weren't deductible.
WHY DID BROOKS COME OUT DIFFERENTLY?
In Brooks, the Tax Court credited an S corporation owner with basis after he made a four-day $800,000 loan to the corporationat year-end. It's not clear why the Tax Court decided the Brooks case differently; perhaps the shareholders loaned their own money to the corporation, rather than borrowed funds. Perhaps the IRS simply failed to raise the issue of whether there was substance to the loan. We have ordered a copy of the briefs filed in Brooks to try to solve this mystery; as the Tax Court charges by the page, we hope the lawyers were succint.
THE MORAL? You put your basis in, you pull your basis out, you put your basis in and you spread it all about, you do the hokey pokey and you turn the cash around, that's what it's all about. Oh, and don't count on short-term advances at year-end for S corporation basis.
CITE: Mark O. Kaplan, T.C. Memo. 2005-218
*click "Read more" for more information about S corporation basis.
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CONGRESS PASSES FIRST ROUND OF HURRICANE TAX RELIEF
September 22, 2005
Congress yesterday sent to the President H.R. 3768, the first tax relief legislation resulting from Hurricane Katrina.
Provisions include:
- Debt forgiveness income resulting from the hurricane - for example, a cancelled morgage, will not be taxed if cancelled before 2007.
- The 10% of AGI and $100 floor on deductions for casualty losses will be waived for Katrina losses.
- The 10% tax on early IRA and pension distributions will be waived for distributions up to $100,000 for families in the disaster area; tax can be distributed over three years, or waived if the amount is repaid to the account within three years.
- The IRS deadline extension to January 3, 2006 for post 8/29/05 filing deadlines is extended to February 28, 2006. The extension also applies to excise and employement taxes, as well as income and estate and gift taxes.
- Employment-related tax credits will be available through 2005 for employees hired in the disaster area through year-end.
The House Ways and Means Committee has a more complete summary that includes several additional provisions. For a thorough discussion of the provisions, go visit Professor Maule.
Congress is trying to help, but there are a lot of people already down in the disaster area doing great things. Give generously to The Salvation Army, the American Red Cross, or one of the other fine agencies that have been helping out since the winds stopped blowing.
LINK:TAX UPDATE IRS KATRINA RELIEF SUMMARY PAGE
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IRS WEB SITE CONSOLIDATES KATRINA GUIDANCE
September 21, 2005
The IRS has linked all of its releases and announcements related to the hurricane at thier new Katrina News Releases & Legal Guidance page.
LINK: TAX UPDATE IRS KATRINA RELIEF SUMMARY PAGE
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STIFFIN' SAMMY SETTLES
September 21, 2005
Sammy Sosa was never really a detail guy. He hit home runs. Other details - knowing which bat was corked, hitting the cutoff man, running until you know the ball has left the stadium, the number of outs at any given time - weren't Sammy's strength.
So it's easy to see how a mere $22,000 legal bill could elude Sammy. A trifle. Put it in perspective: a $22,000 legal bill to Sammy's $16 million salary is like a $68.75 premium cable bill to a fan earning $50,000.
But Sammy's former attorneys didn't seem to appreciate that perspective. They sued Sammy earlier this month for $22,000 in unpaid fees for tax controversy services. The parties settled last week; the TaxProf has what details are available.
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RARE CONFIRMED GREMLIN SIGHTING
September 20, 2005
The Tax Update this weekend captured a photograph of a nearly-extinct gremlinus americanmotorus. Thought by many naturalists to be extinct outside its native Kenosha County, Wisconsin range, it is apparently hanging on by a thread in West Des Moines. The evidence:
Gremlinus Americanmotorus, photographed September 17, 2005
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DON'T SEND A RETURN; JUST REVIEW YOUR TAX STATEMENT
September 20, 2005
We have wondered whether the government could simplify the lives of many taxpayers with simple returns by simply using information it already has - W-2s, 1099s, and mortgage interest statements - to compute taxes for many taxpayers. Instead of filing returns, taxpayers with simple tax situations could simply receive a statement calculating their taxes. If the taxpayer approved, a refund or a bill would follow; if the taxpayer didn't like the statement, they could then file a return.
California has now launched a pilot program to implement such a system. The California ReadyReturn system was made available on a pilot basis for taxpayers with wage-only 2004 returns. The TaxProf today makes available a comprehensive Tax Analysts piece about the ReadyReturn experiment. In addition, the TaxProf provides a number of additional links to information about the program.
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"WINDFALL" PROFITS TAX?
September 20, 2005
We once likened experts in the old "Windfall Profits Tax" of the 1970s to the dodo bird -- both are extinct. We may have been premature about the Windfall Profits Tax part.
An economist with the Center for Economic and Policy Research, a liberal think tank, proposed reviving this relic of 1970-era economics to help fund Hurricane Katrina relief. This version would impose a special 30% tax on oil companies whose profits exceeded a five-year average.
There is no mention in the story of whether a windfall losses credit will be available for companies with below-average profits, but somehow I doubt it.
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IRS DEFENDS INDICTMENTS OF BIG FIRM CPAS TO SCEPTICAL ATTORNEYS
September 20, 2005
A top assistant to IRS Commissioner Everson last week defended the recent indictments of former KPMG partners to a sceptical audience of attorneys last week, according to a Tax Analysts report. Speaking to the American Bar Association Tax Practice Committee in San Francisco, John Klotsche said the indictments are not an overreach by the IRS. Per the report:
Contrary to some published reports, the government’s tax fraud conspiracy case against KPMG and the resulting deferred prosecution agreement is not about the IRS and the Justice Department criminalizing the tax practice of technical tax shelters, said John Klotsche, a senior adviser to IRS Commissioner Mark Everson. “Nor is it a case about criminalizing aggressive tax planning or tax advice,” or about tax opinions on abusive tax shelters with which the IRS disagrees or which turn out to be wrong, he said.
Mr. Klotsche said that KPMG "crossed the Rubicon" from civil to criminal problems in its activities. An attorney at the meeting wasn't so sure:
It remains to be seen whether the Rubicon was crossed, or how many crossed it, responded moderator Larry Campagna of Chamberlain, Hrdlicka, White, Williams, & Martin in Houston. Moreover, no one should characterize the deferred prosecution agreement between KPMG and the government as a negotiated document, he said. The firm had a “gun to its head” and was given the choice of living with the terms, or not living at all, he said.
Practitioners will be following the case closely to see whether the evidence supports the IRS charges; the defense is likely to assert that the IRS is criminalizing normally aggressive tax practice.
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DEFIANT "SURVIVOR" HATCH PLEADS NOT GUILTY
September 19, 2005
A defiant Richard Hatch entered a "not-guilty" plea today in a U.S. district courtroom in Rhode Island. He faces a number of charges, including failing to pay taxes on his $1 million prize for winning the first "Survivor" season. He is also accused of diverting money intended for charity to personal uses. From an Associated Press report:
Before the hearing, Hatch, 44, called the accusations absurd. He is also accused of using donations made to his charity for personal expenses and failing to pay taxes on hundreds of thousands of dollars of other income.
"I've never taken a penny from a charity, and they know it. I've always paid my taxes, and they know it," he said.
A grand jury indictment filed earlier this month said Hatch filed false 2000 and 2001 tax returns, omitting his income from the reality show, $327,000 he was paid to co-host "The Wilde Show" on WQSX-FM in Boston and $28,000 in rent on a property he owns in Newport.
Hatch had two accountants prepare tax returns for 2000 that included his "Survivor" winnings, but he did not file them when he learned he would owe hundreds of thousands of dollars in taxes, the indictment said. In 2002, he had one of the accountants prepare a second return that did not include his winnings from the television show. He filed that one, which called for a $4,500 refund, the indictment said.
PRIOR COVERAGE: 'SURVIVOR' HATCH TO FIND OUT WHY THEY'RE CALLED PLEA 'BARGAINS'
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THE GIFT THAT KEEPS ON GIVING
September 19, 2005
Attorney Joel Shoenmeyer notes a strange case at Death and Taxes - The Blog. According to the story, it is alleged that attorneys for the Manhattan firm Graubard Miller tricked a woman to making "gifts" to them:
Ms. Lawrence wrote personal checks to the three Graubard Miller partners. [C. Daniel] Chill received $2 million. [Elaine M.] Reich received $1.55 million and [Steven] Mallis received $1.5 million.
According to the suit, they specifically told her not to pay this money to the firm, but to each of them individually. Chill allegedly instructed her to denote the payment as a "gift" on each check's memo line.
The Tax Update would never do such a thing. We would insist on small-denomination unmarked bills.
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CAPITALIST CARNIVAL UP!
September 19, 2005
This week's Carnival of the Capitalists is up at Willisms.
The Carnival is a weekly summary of economics and business weblog postings. You might be interested in Brian Gongol's post on "Solving Iowa's Budget Problem" or Dan Meyer's "Starting a Business on a Shoestring" at his "Tick Marks" blog.
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LYNDEN BRIDGES GOING DOWN
September 19, 2005
Two accountants have been sentenced for their part in the Anderson's Ark tax scam. Lynden Bridges of Wheat Ridge, Colorado, will go away for 18 months, and Tara Lagrand of Naples, Florida, gets 24 months.
The Anderson's Ark program had taxpayers send money overseas disguised as business expenses. After the Ark took it's cut, the participating taxpayers would secretly tap the overseas funds for personal use. The principal sponsors of the scam have received sentences up to 20 years.
(Via Tax Analysts)
Prior coverage here.
LINK: Department of Justice Press Release
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"ZERO-TAX " PROMOTER TRIAL BEGINS
September 19, 2005
The tax evasion and conspiracy trial of Irwin Schiff began last week in Las Vegas. Mr. Schiff is a godfather of the tax protest movement, starting with his 1982 opus, "How Anyone Can Stop Paying Income Taxes" (starting at $1.97 at Amazon.com). His checkered career has included having his book royalties attached by the IRS for back taxes.
Also in the dock is Cynthia Neun, best known for talking with now-jailed tax protester Al Thompson while he was leading California police on a high-speed chase.
The trial is expected to last six weeks, according to Tax Analysts. Those poor jurors.
IT'S THE PRINCIPLE OF THE THING?
Mr. Schiff is defending himself. Lawyers for the other defendants say that they didn't think they were breaking the law. Per Tax Analysts:
Cristalli and Bowers, representing Neun and Cohen, respectively, maintain that their clients and other zero income filers did not join the movement for the financial rewards but because they agree with Schiff.
A wise man once said "when they say it's not about the money, it's about the money."
Coverage:
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IRS MOVES TO LIQUIFY ESTIMATED TAX RECEIPTS
September 18, 2005
The TaxProf Blog reports that 30,000 estimated payments are lost in San Francisco Bay after a truck carrying them to a bank was involved in an accident on the San Mateo Bridge.
The payments were from Alaska, California, Hawaii, Idaho, Montana, Nevada, Oregon, Utah, Virginia, Washington, and Wyoming, according to the report.
Dr. Maule says this incident shows the advantages of electronic payment of estimated taxes. He also passes on the following suggestion if you suspect your estimated payment has been invested in seawater futures:
Check with your bank (or have your client check with the bank) to see if the check cleared. If it has, fine. If it has not, call the IRS to see if the check has been posted to the taxpayer's account. If it has not, stop payment on the original check and send in a replacement. I add this cautionary note: include a statement that the check is being sent as a replacement for a timely mailed payment presumed lost on account of the 11 September 2005 San Mateo bridge accident. No one knows if the IRS will waive penalties. If it doesn't, that will surely generate an uproar.
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OCTOBER 2005 APPLICABLE FEDERAL RATES RELEASED
September 18, 2005
The IRS has issued (Rev. Rul. 2005-66) the minimum interest rates for loans made in August 2005:
-Short Term (demand loans and loans with terms of up to 3 years): 3.89%
-Mid-Term (loans from 3-9 years): 4.08%
-Long-Term (over 9 years): 4.40%
Historical AFRs are available via the “Links” page at www.rothcpa.com.
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SENATOR GRASSLEY: ESTATE TAX REPEAL "UNSEEMLY"
September 16, 2005
Senator Grassley gave a broad hint that there will be no estate tax compromise, or repeal, in 2005. The Des Moines Register reported yesterday:
Grassley, in a conference call with Iowa reporters, said he believes debate over the repeal will be postponed.
"It's a little unseemly to be talking about doing away with or enhancing the estate tax at a time when people are suffering," said Grassley, a Republican who is in charge of the committee that writes U.S. tax policy.
"It wouldn't surprise me if nothing's going to happen during the year 2005," he said.
Prior to the hurricane, the Senate had been slated to vote to repeal the estate tax - a vote that Senator Grassley said had "zero" chances of garnering the 60 votes needed. He had said that agreement was near on a compromise to raise the exemption and lower the estate tax rate to 15%, but that seems to be on hold for now.
LINKS:
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IRS ALLOWS KATRINA WITHDRAWALS FROM RETIREMENT PLANS
September 16, 2005
The IRS has granted qualified plans blanket permission to make hardship distributions or loans to disaster-area residents (Announcement 2005-70). The relief also applies for those with relatives affected by the disaster, per the announcement:
A qualified employer plan will not be treated as failing to satisfy any requirement under the Code or regulations merely because the plan makes a loan, or a hardship distribution for a need arising from Hurricane Katrina, to an employee or former employee whose principal residence on August 29, 2005, was located in one of the counties or parishes in Louisiana, Mississippi or Alabama that have been or are later designated as disaster areas eligible for Individual Assistance by the Federal Emergency Management Agency because of the devastation caused by Hurricane Katrina or whose place of employment was located in one of these counties or parishes on such date or whose lineal ascendant or descendant, dependent or spouse had a principal residence or place of employment in one of these counties or parishes on such date. Plan administrators may rely upon representations from the employee or former employee as to the need for and amount of a hardship distribution, unless the plan administrator has actual knowledge to the contrary, and such distribution is treated as a hardship distribution for all purposes under the Code and regulations.
The Tax Prof has posted a comprensive set of Katrina relief links.
Don't forget the Katrina Benefit tonight at Biaggi's in West Des Moines.
LINK: Tax Update Summary of Katrina relief.
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KATRINA RELIEF PASSES SENATE
September 16, 2005
The Senate yesterday passed its version of short-term tax relief to deal with the Katrina disaster. Tax Analysts summarizes the provisions of the Senate version of H.R. 3768:
* hold families harmless against the loss of tax benefits due to temporary relocations and allow individuals to use their 2004 income to determine the child credit and the earned income tax credit on their 2005 returns;
* provide to taxpayers who house displaced individuals an additional personal exemption of $500 per displaced person;
* extend the work opportunity tax credit to employers that hire displaced storm victims;
* provide to employers located in the disaster zone a 40 percent tax credit for wages (up to $6,000) paid to employees through the remainder of 2005;
* waive the 10 percent tax on early distributions from IRAs and pensions for individuals affected by the hurricane;
* exempt from income tax storm victims' debts discharged by commercial lenders;
* allow full deductibility of personal casualty losses for hurricane victims;
* extend the replacement period for homes and businesses damaged by the hurricane;
* relax some restrictions on mortgage revenue bonds;
* raise the permitted charitable contribution level for corporations and individuals;
* increase the charitable mileage reimbursement rate;
* enhance the deduction for charitable donations of food and books; and
* extend tax filing deadlines and waive penalties and interest that would have applied on income, estate and gift, employment, and excise taxes for at least six months.
This is similar to the House-passed version of the bill, so the final bill will look much like this.
WHAT ABOUT ROUND TWO?
This is only the first round of Katrina tax provisions. Another bill will put in longer-term reconstruction incentives, perhaps including a $200,000 Section 179 deduction and restored bonus depreciation for the disaster area proposed last night by the President.
LINKS:
Joint Committee on Taxation explanation of House-passed bill
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KATRINA BASH TOMORROW IN WEST DES MOINES
September 15, 2005
You can have a good time and do a good deed tomorrow at the "After the Storm" benefit at Biaggi's. Details are below. Contact Rebecca Kavanagh for more information.
POWER TOOLS!
If you can't make the party, just click the links and give to the American Red Cross, The Salvation Army, or another fine relief charity.
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KATRINA AID WORKERS GET EXTENSIONS
September 15, 2005
The IRS will give Katrina aid workers the same automatic extension of return payment and filing deadlines already available for residents of the disaster area. This means aid workers - relief workers assisting in the disaster area - have until January 3 to pay amounts otherwise due since August 29. This includes third quarter payments due today and extended 1040s due October 15. (IR 2005-103)
LINK: Summary of Katrina relief.
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GUILTY, UNLESS HE'S NOT
September 14, 2005
It's difficult to reconcile the headline and the first sentence of this story:
At least the piece can't be completely wrong. It's one or the other. But in case they fixed it, we've immortalized the screen shot.
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CHEAP GAS: WHERE TO GO FOR LOW TAXES
September 14, 2005
The Tax Foundation Blog has a nice map of effective gasoline tax rates, by state. Can I really save 4.1 cents a gallon just by driving two hours to Missouri for a fill? Oh, boy!
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BUT WILL THE COOL KIDS HANG WITH THE NERDS?
September 14, 2005
TaxProf Paul Caron says that tax lawyers and other lawyers should get together more:
Although I offer my views on these issues, the thrust of the Article is its advocacy of a cross-pollination approach, rather than a definitive resolution of these structural concerns that have bedeviled tax and nontax law for decades. By replacing the myopic vision of the tax law with an appreciation of the symbiotic relationship between tax and nontax law, the ultimate resolution of these tax issues will be facilitated by nontax learning, and tax, in turn, will provide a useful laboratory within which to test and refine these nontax principles.
And which lawyers are the cool kids, anyway?
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PENSION CONTRIBUTION DEADLINE EXTENSION LIMITED TO DISASTER AREA
September 14, 2005
The Treasury Department yesterday (JS-2715) said that it will limit the deadline relief for pension contributions to businesses in the disaster area:
In addition to this previously announced benefit relief, we have received requests to permit the delay of pension payments due on September 15 for certain employers located outside the devastated area. We have concluded, however, that the best approach is to limit the relief to those employers located within the geographical region of the hurricane. We have reached this conclusion because we believe our primary focus in all of our relief efforts should be to assist those directly in the path of the hurricane's destruction. While targeted relief is appropriate in these extraordinary circumstances, we remain equally committed to the necessary discipline of the funding requirements to protect the interests of workers and retirees, responsible plan sponsors, and ultimately taxpayers by targeting that relief to those directly affected by Katrina.
This is the first evidence we've seen of the government putting some limits on hurricane relief. With assistance legislation being thrown around with $90 billion price tags, we hope they make sure that the assistance doesn't end up building new Alaskan bridges.
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TAXPAYER ASSISTANCE CENTERS GET "D" FOR 2005 FILING SEASON
September 14, 2005
Taxpayers have developed low expectations for IRS Taxpayer Assistance Centers, which have long had a reputation for unreliable answers to taxpayer questions. They apparently lived up to those expectations again in 2005.
The Treasury Inspector General for Tax Administration (TIGTA) reports that 66% of questions at the TACs were answered correctly last filing season. That was about the same as last year, and short of the IRS goal of 81% accuracy. It says something about the difficulty of the tax law that getting one of five answers wrong is considered a standard to shoot for. From the report:
Other contributing factors include the complexity of the tax law and the number of potential questions assistors have to be prepared to answer. For example, assistors are trained and expected to be knowledgeable in 318 tax law topics with 395 subtopics. They are expected to be able to respond to taxpayer issues for the current and prior tax years.
TIGTA also issued a report recommending improvements in the TACs.
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HE KNEW THIS WAS COMING...
September 13, 2005
News from Knoxville, Tennessee:
KNOXVILLE, Tenn. A federal grand jury has indicted self-proclaimed psychic David Marius Guardino of Caryville.
The indictment says Guardino failed to filed federal income tax returns for 1998 and 1999, during which he earned nearly 345-thousand dollars.
And he doesn't even have to wait for the trial to know whether he beats the rap.
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FINANCE COMMITTEE PROPOSES KATRINA RELIEF
September 13, 2005
The Senate Finance Committee introduced a bipartisan Katrina relief bill. The Finance Committee press release says the bill will include the following targeted provisions:
*The proposal would provide an exemption for indebtedness discharged by commercial lenders when the forgiveness is in response to damage suffered from Hurricane Katrina.
*The proposal would waive the 10% penalty tax for premature distributions from IRAs and qualified retirement plans (including defined benefit plans, 401(k) plans and 403(b) plans) for individuals whose principal residence is in a federally declared natural disaster area.
*The Work Opportunity Credit, currently targeted to those hiring employees from targeted groups, would be extended to new hires from the Katrina disaster area. Employers outside the area would qualify for hires from 8/28/05 to 8/28/06; employers inside the disaster area would qualify for a three year period starting 8/28/05. The credit would apply to employees who become unemployed because of workplace hurricane damage.
*Personal Exemptions. The bill would give an additional personal exemption of $500 for each dislocated person.
The bill also contains provisions to encourage donation of food and books by businesses, an increased charitable auto mileage deduction, and a waiver of the 10% of AGI floor for casualty deductions in the Katrina area.
Is it good policy? That seems unlikely. It's hard to say that a taxpayer who loses his home to a fire in California or a tornado in Kansas is less deserving than one losing a house to a hurricane in Biloxi. It's also not clear that encouraging folks to rebuild by spending their retirement savings is wise. But that won't matter; political considerations require Congress to do something, good tax policy notwithstanding.
LINK: Finance Committee description of Katrina relief
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WHITHER THE 15% DIVIDEND RATE?
September 13, 2005
A report in the Wall Street Journal (subscriber-only link) suggests that the 15% tax rate for dividends and capital gains may be a victim of Hurricane Katrina:
The House and Senate had planned a fall legislative agenda around a massive budget bill that extended to 2010 the 15% tax rate on dividends and capital gains signed by President Bush two years ago. The cut was one of the president's signature initiatives and is seen inside the White House as a key part of his economic legacy.
The 15% rate isn't scheduled to expire until the end of 2008 -- meaning there's still time to push an extension through. But Republicans, chastened by the costs of rebuilding the Gulf Coast and negative public assessments of Washington's initial response to the hurricane, have decided that taking any action on the bill is politically untenable at least until late October in the suddenly changed political and budgetary environment.
The Journal suggests that Congress may punt the capital gain rate extension vote to 2006. The only item the article suggests is a sure bet is an extension of the higher AMT exemption currently set to expire after this year.
Meanwhile, Tax Analysts reports in their subscription-only edition that Senate Finance Committee Chairman Grassley remains committed to the 15% rate - with an important reservation:
While the storm has rearranged some of the Senate's priorities, Finance Committee Chair Chuck Grassley, R-Iowa, remains committed to moving a reconciliation bill that would extend the capital gains and dividend rate cuts, current alternative minimum tax relief, and a number of popular expiring provisions.
"We've still got to find offsets to make it all work," a Finance Committee aide said.
Offsets - there's the rub. The lower rates were enacted with an expiration date to reduce their revenue cost under Congressional budget rules. Now Congress has to come up with tax increases (they seem unable to even imagine spending cuts) to "pay" for continued 15% rates.
ESTATE TAX UPDATE
The WSJ and Tax Analysts also have seemingly conflicting stories on the estate tax. The WSJ says of the estate tax negotiations:
Prospects were already dim for attracting the 60 votes needed to overcome a Democratic filibuster against full repeal. Now there's new impetus behind compromise talks that would preserve the levy for a reduced number of the most valuable estates. Legislative aides in both parties agree that the Democrats' hand has been strengthened in those talks, which include Sen. Baucus, Sen. Grassley and Republican Sen. Jon Kyl of Arizona.
Tax Analysts suggests that Democrats may feel strong enough to walk away from the negotiations, at least for now:
Frist also postponed a vote to repeal the estate tax, and now the top Democratic negotiator on the issue is indicating he is unlikely to continue working toward a compromise.
“We only have so many days left this year and so much is going to be Katrina-, budget-, and tax-related,” said Finance ranking minority member Max Baucus, D-Mont.
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CAPITALISTS PARTY, TOO
September 12, 2005
This week's Carnival of the Capitalists, a weekly summary of economics and business weblog posts, is now up at Crossroads Dispatches.
My favorite out of this week's postings is Photon Courier's discussion of "diminishing returns in information." Sometimes you just have to decide based on what you already know. You just can't wait to get ALL the facts.
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WILL KATRINA BLOW AWAY YOUR TAX TROUBLES?
September 12, 2005
If you were hoping that the IRS would forget about your taxes because of the hurricane, don't count on it.
The IRS has given taxpayers from the Katrina disaster area extensions for filing returns and making tax payments. Now they have also given themselves until January 3, 2006 to do things they would otherwise have to do before then (Notice 2005-66). For example, deadlines for deficiency notices, assessments and lawsuits are extended for that period.
LINK: Summary of IRS Hurricane Relief.
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BRUNORI: LEGISLATORS WELL MEANING, BUT IGNORANT
September 12, 2005
The Tax Analysts state tax correspondent has been chatting with state legislators. The results are somewhat depressing:
I've spent the last couple of months talking to state legislators about tax policy. I talked to 100 legislators from 38 states, either by calling them or seeing them at conferences. I tried to talk to lawmakers who weren't members of taxwriting committees. If the sample I picked is representative, state lawmakers --- Democrats and Republicans --- are well-meaning, principled people. They serve to make society a better place. I talked to some hard-core conservatives as well as flaming liberals. I ended my sojourn feeling much better in general about our elected state leaders.
But most lawmakers are also woefully uneducated about tax policy. Far too many are willing to narrow the tax base to advance some particular economic or political agenda. All 100 lawmakers I spoke with supported some type of tax exemption. Of course, they all said the exemptions they supported were for "very good causes."
More troubling, I found that many of the lawmakers didn't understand that the more exemptions and deductions granted, the higher rates must be to raise revenue. Many lawmakers didn't know that riddling the tax base with exemptions leads to market distortions and higher compliance and administrative costs.
Depressing, but not surprising. Legislators hear from a lot of deserving constituents who really could use a tax break, and not a lot from those whose tax lives become more complex with every targeted tax credit.
Link (Tax Analysts Subscribers only)
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CARNIVAL OF PERSONAL FINANCE
September 12, 2005
This weeks Carnival of Personal Finance, a weekly summary of personal finance blog entries, is up at Smart Money Daily. Topics this week range from avoiding charity scams to choosing the right mortgage.
Speaking of charity scams, the proprieter of TaxGuru.net tells how his wifedeflected a scam call the other day. His good advice: remember that The Salvation Army and the Red Cross don't call soliciting donations.
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BORIS BITTKER DEAD
September 11, 2005
Boris Bittker, co-author of the venerable "Federal Income Taxation of Corporations and Shareholders" and distinguished tax scholar, has died. (via Instapundit).
UPDATE: A tribute from the Tax Prof, Paul Caron:
His classic treatises, Federal Taxation of Income, Estates and Gifts (with Lawrence Lokken) and Federal Income Taxation of Corporations and Shareholders (with James Eustice), are the signal tax scholarship accomplishments of my professional lifetime.
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IRS BOOSTS MILEAGE RATE TO 48.5 CENTS STARTING SEPTEMBER 1
September 09, 2005
IRS Commissioner Everson announced today that the standard mileage rate has been increased to 48.5 cents per mile for the period September 1 through December 31, 2005. It had been 40.5 cents since January 1, 2005.
Details at the Tax Analysts free site.
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