The Advocate reiterates her longstanding recommendation that the government do more to protect taxpayers by regulating unenrolled federal tax return preparers, including by requiring initial testing and continuing professional education, and recommends that the IRS step up enforcement actions against preparers who fail to perform due diligence or consciously facilitate noncompliance.

The report has a critical unstated assumption: that such regulation would do more good than harm. Not bloody likely. The predictable unintended consequences:

- The supply of preparers would go down as folks will not want to screw around with the bureaucracy for what is for many just seasonal work.

- Unenrolled tax preparers will go underground, not signing returns. It is, after all, legal for folks to do their own returns (for now, anyway). These folks will be very difficult to track. A single mom trying to figure out her earned income credit in a housing project isn't going to lose sleep over whether the lady helping her with the paperwork in her apartment is licensed.

- Honest preparers will get caught up in paperwork mistakes of their own making, or made by the new IRS preparer bureaucracy, and will lose their seasonal income before the problems get ironed out.

- Resources that could be used to develop computerized enforcement tools to identify dishonest filing patterns will instead be used shuffling CPE paperwork and harassing preparers.

Finally, it is highly unlikely that all of this will result in a better product. We all remember when Fortune magazine would have a tax return preparered by different preparers and get as many results as preparers. The real reason for poor return prep quality is a poor quality of tax law. That root problem will exist until my modest reform proposal is finally adopted:

I have the answer to this problem, of course -- require that all Congresscritters do their returns in public themselves via a live webcast. They can use Turbotax or the software of their choice, as long as all input screens and output are broadcast live on the web, with a sidebar for running viewer commentary. Or, perhaps, selected tax pros could do the kibitzing - think "Mystery Science Theater 3000," tax geek version. Naturally, the whole comedy should also be available for playback on YouTube. I think this would have two useful results: Congresscritters would have a stake in tax simplification, and they would learn the difference between a deduction and a credit.

For a contrary view on the Taxpayer Advocate report, see Peter Pappas. Dan Meyer also has more.

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And for those looking to take away a layer of bureaucracy, repealing the ordinance seems like an easy way to do that. The ordinance states that, "The room where dancing is conducted shall be illuminated to a minimum of two footcandles, as measured by a photometer at a plane 30 inches above the floor."

I suppose a strobe wouldn't count.

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It's off to the credit counselor. He sits you down and lays it on the line: you need to make more money. Maybe knock off convenience stores, or something.

David Brunori is providing just that sort of insightful advice to broke states in his post States Should Raise Income Taxes to Solve their Budget Problems:

The CBPP says that raising income taxes on the wealthiest citizens can help close budget deficits. Indeed, the report says that raising the personal income tax 1 percentage point on households making more than $500,000 would raise a whopping $8 billion nationwide. The CBPP maintains that raising taxes on the really rich is less harmful to the economy than cutting services. The CBPP is right, of course. There's nothing unfair about closing budget deficits by enacting a little tax increase on a guy making $500,000. The people subject to the tax are making more than 99 percent of the population. Call me a big fat liberal, but using that extra tax revenue to support services for the unemployed family needing healthcare and education doesn't bother me one iota.

Because every dollar spent by the states is for unemployed families needing healthcare and education.

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(Robert D Flach on Jul 2, 2009 10:35 AM) JK- I believe that every single dollar raised by the State of New Jersey is put to good use providing much needed services to residents. I also believe in Santa Claus, the Easter Bunny, that The Apprentice and The Bachelor are good tv, all politicians are basicaly honest, and that the aliens have found a way to read my mind if I don't wear a hat of tin foil! TWTP

(Jason on Jul 2, 2009 10:45 AM) Well, what do you know. Neil Harl is saying that Iowa needs to do the same thing - raise taxes. That always works - yeah right!

KCCI has harrowing video.

Our thoughts and prayers to the victim's family.

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Nebraskans Paul and Alicia Garnett invested in LLCs and LLLPs that operated farming businesses in Iowa. The Garnetts claimed that they "materially participated" in the entities and deducted losses shown on the K-1s from the LLCs and LLLPs. The IRS assessed about $360,000 in deficiencies from these losses from 2000 to 2002, saying that the losses were passive no matter what. "Passive" losses are allowed only to the extent of "passive" income, or when the activity is sold.

The IRS applied Sec. 469(h)(2), which says:

Except as provided in regulations, no interest in a limited partnership as a limited partner shall be treated as an interest with respect to which a taxpayer materially participates.

The taxpayers argued that LLCs and LLLPs are not "limited partners" under these rules, and they are therefore subject to the regular "material participation" rules for determining whether a loss is passive. The Tax Court looked at the state law rules governing these entities to sort it out. The court found that Iowa law gives allows powers to LLC members and LLLP owners beyond those allowed traditional limited partners. They also said limited liability wasn't enough to make an owner a "limited partner" under Sec. 469(h)(2):

Thus, while limited liability was one characteristic of limited partners that Congress considered in the enactment of section 469(h)(2), it clearly was not, as respondent suggests, the sole or even determinative consideration. To the contrary, the more direct and germane consideration was the legislative belief that statutory constraints on a limited partner's ability to participate in the partnership's business justified a presumption that a limited partner generally does not materially participate and made further factual inquiry into the matter unnecessary.

We do not believe that this rationale properly extends to interests in L.L.P.s and L.L.C.s. As previously discussed, members of L.L.P.s and L.L.C.s, unlike limited partners in State law limited partnerships, are not barred by State law from materially participating in the entities' business. Accordingly, it cannot be presumed that they do not materially participate. Rather, it is necessary to examine the facts and circumstances to ascertain the nature and extent of their participation. That factual inquiry is appropriately made, we believe, pursuant to the general tests for material participation under section 469 and the regulations thereunder.

My view: This is a stupid argument for the IRS to make. When Sec. 469(h) was written, LLCs and LLLPs barely existed. The differences between these new entities and the old limited partnerships are profound, and it is common for LLC and LLLP members to work full time in roles analogous to general partners in limited partnerships. The new entities just aren't comparable to limited partnerships.

Just from the standpoint of the IRS, this is an unwise argument to make. If losses from these entities are per se passive, so is income. An IRS "victory" in this case could open up a world of opportunities for entrepreneurs, who would suddenly find they had lots of passive income from their LLCs that they could shelter with traditional tax shelter partnerships.

Yesterday's ruling doesn't close the case; it was a "summary judgment" motion on the 469(h)(2) issue. The IRS might still challenge the losses under the normal "material participation" standards.

Cite: Garnett, 132 T.C. No. 19.

Below: tax law standards for material participation

Continued reading Tax Court: LLC and LLLP owner losses don't have to be passive...

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Mr. Brown said the lawyer wasn't willing to conduct the defense the way Mr. Brown directed. I wonder why? Maybe it has to do with this:

In court filings, the Browns say they are not the people named in the indictment. They sign their motions: “Edward-Lewis:Brown” and “Elaine-Alice:Brown.”

“We are not the EDWARD BROWN and ELAINE BROWN,” they wrote, saying if the court continues to deny their contention, “we will again be forced to retreat from this collusive and hostile arena.”

The funky punctuation defense has a poor record in federal courts.

The trial continues today.

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(Monica Lawver on Jul 1, 2009 9:18 AM) Thanks for the shout-out, Joe! Some of my co-workers would be shocked to hear me referred to as "cool-headed." Perhaps I can keep up the appearance, as long as you don't meet me in person...

(Robert D Flach on Jul 1, 2009 6:13 PM) JK- I've been called a lot of things over the years - and actually "tax nerd" ain't so bad. I look forward to your joining the fray. As cool-headed as Monica I expect. TWTP

The roundup of insurance and risk management blog posts includes an Insureblog must-read on the legal dangers employees may face running "health risk assessments" of their employees.

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First and foremost, it appears that everyone on both sides agrees pretty much that registering and licensing currently "unenrolled" tax preparers (like myself) will do little, if anything, to cut down on fraudulent tax returns and unethical preparers.

Just as regulation of CPAs, lawyers, and doctors has not rid us of unethical members of these groups, regulation of tax preparers will not rid us of unethical tax preparers.

Alright then. It doesn't work, but we want to do it anyway. Maybe if I think about it long enough, it will make sense to me.

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(Robert D Flach on Jun 30, 2009 2:46 PM) JK- You gotta read the rest of the post - that was my opening comment and not by "last word". Don't you want me to get any respect? RDF

(Joe Kristan on Jun 30, 2009 3:06 PM) Robert, I'll always respect you, even without an IRS-issued license! Yeah, I know, that's what all the guys say...

Today is the deadline for

As if to encourage the rest of us to file, the Justice Department last week announced a guilty plea for FBAR non-compliance by a client of Swiss bank UBS. The TaxProf has a roundup of coverage.

As this plea shows, offshore account secrecy seems to be crumbling. The IRS is offering an amnesty of sorts for those who haven't reported these accounts in the past, and it is very attractive compared to the consequences of getting caught for non-reporting. The amnesty runs through September 23, 2009.

The IRS has unilaterally extended today's deadline for new FBAR filers who have reported all of their foreign-source income but who did not know they had an FBAR filing obligation. Those taxpayers may file without penalty through September 23, but they need to follow special procedures.

If you are filing today, spend the extra four bucks or so and file Certified Mail, Return Receipt Requested. The IRS doesn't save the postmarks, so you need to.

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Elmer Scheckel of Oelwein, Iowa decided to give the argument a try to get out of Iowa income taxes. It didn't go well:

The argument advanced by the Protester is merely a variation upon a claim that has been repeatedly considered and rejected by state and federal courts for decades. The 8th Circuit Court of Appeals and other federal appellate courts from around the country have decisively held that “wages are within the definition of income under the Internal Revenue Code and the Sixteenth Amendment, and are subject to taxation

The Moral: Wishing doesn't make it so.

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(TaxRascal on Jun 30, 2009 12:24 PM) I've had this argument with too many folks to count. What I like to point out is that even if they're right, it's not going to change much. If they start winning court cases, Congress is just going to say "Whoops!" and rewrite the income tax law so that it works the way it's currently enforced. http://www.taxrascal.com/tax-qa-i-heard-there-isnt-actually-a-law-that-says-we-have-to-pay-taxes-is-this-true/147/

Weasel arguments trying to square categorical pledges with political realities are dangerous. They encourage (more) voter cynicism and obstruct useful policy development. Better to simply acknowledge the reality. Which, after all, is not such an unpleasant one, at least for Democrats.

Which is why Axelrod's admission is welcome. It was also probably unavoidable -- trying to reconcile the health benefits tax with Obama's over-broad campaign promise was never going to fly. But it's still a step in the direction of political truth telling. Which is a refreshing change.

If welshing on campaign promises (less politely known as "lying") is refreshing, we've been well refreshed for lo these many years. What would really be refreshing is if politicians actually were honest before the election, while we could still do something about it.

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UPDATE: And Flach takes another swing! UPDATE II: Pappas parries! And again!

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(Robert D Flach on Jun 30, 2009 8:24 AM) JK- I have just finished writing my response to Pete's response to my response to his post and it will be up at TWTP shortly. So what is your opinion on the topic? TWTP

(Robert D Flach on Jun 30, 2009 9:25 AM) JK- FYI - I am NOT an Enrolled Agent, although I am from New Jersey (though not for too much longer). I am an "unenrolled" preparer. TWTP

(Joe Kristan on Jun 30, 2009 9:34 AM) Robert - Fouled up again. Sorry about that. Fixed the enrolled agent reference. I'll try to put up my thoughts later, or tomorrow.

Business exits Iowa over taxes

The money to subsidize Hollywood has to come from somewhere, but the state will learn that the non-subsidized chumps don't have to stay chumps. They can leave.

Related: IF TRUTH IN ADVERTISING APPLIED TO ECONOMIC DEVELOPMENT AGENCIES

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Taxpayers who reported and paid tax on all their 2008 taxable income but only recently learned of their FBAR filing obligation and have insufficient time to gather the necessary information to complete the FBAR, should file the delinquent FBAR report according to the instructions and attach a statement explaining why the report is filed late.

Send a copy of the delinquent FBAR, together with a copy of the 2008 tax return, by September 23, 2009, to the Philadelphia Offshore Identification Unit, at the following address:

Internal Revenue Service
11501 Roosevelt Blvd.
South Bldg., Room 2002
Philadelphia, PA 19154
Attn: Charlie Judge, Offshore Unit, DP S-611

In this situation, the IRS will not impose a penalty for the failure to file the FBAR.

Additionally, if all 2008 taxable income with respect to a foreign financial account is timely reported and a United States person only recently learned they have a 2008 FBAR obligation and there is insufficient time to gather the necessary information to complete the FBAR, the United States person may follow the procedures set forth above and no penalty will be imposed.

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-Short Term (demand loans and loans with terms of up to 3 years): 0.82%

-Mid-Term (loans from 3-9 years): 2.76%

-Long-Term (over 9 years): 4.36%

Historical AFRs are available at the "links" page at www.rothcpa.com. You can also click here for the rates for prior months as reported in the Tax Update.

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I am merely suggesting that since CPAs, Tax Lawyers and IRS Enrolled Agents are heavily regulated (and by virtue of their education and continuing training are the least likely to engage in unscrupulous conduct) we ought to level the playing field and monitor the rest of the tax preparers, too.

The playing fields are bumpy already. While lawyers have to keep up a certain level of CPE and so on, that can be gamed. One of the most popular schools for lawyers in Iowa is the year-end bar association tax school held at the Marriot. It is popular because it provides lots of CLE in December, when the lawyers are running up against their deadline. It is also popular because it is broadcast closed-circuit in the hotel, so the lawyers can get their CLE without ever leaving their rooms. So the lawyers can do client work, or party, or sleep in, and still get their CLE. Most lawyers take their CPE seriously, but it would be astounding if everyone did. If lawyers can game CPE so easily, how hard could it be for a much larger cohort of licensed preparers?

In return for fulfilling their CPE obligations, the lawyers get a government-enforced monopoly on certain things. They get to draft partnership agreements, even if that really means blessing an agreement actually drafted by the CPA who actually understands the deal and the partnership rules. They get to do wills and contracts and so on. And with attorney-client privilege, they get to operate behind a veil that other preparers would kill for.

Meanwhile, CPAs have a monopoly of their own with the ability to bless audited financial statements. This naturally gives them an opportunity to get tax work ahead of other practitioners. They also get a brand name advantage from the "CPA" designation that drives other practitioners to distraction (in spite of the best efforts of some CPAs to wreck the brand). In other words, the playing field tilts both ways, if I may so butcher the metaphor.

It's in the interest of H&R Block and other private prepares to not screw up too badly; it's bad for business. It's not at all clear that creating an IRS preparer regulation bureaucracy will make things better. In this case, "making the playing field level" works a lot like "suppressing low-cost competition."

It is clear that licensing would cost millions of dollars that could be better used improving IRS information systems so they could spot suspect returns like the credit card companies spot suspect transactions.

Related: Yes, I still don't want to regulate preparers

Next week: is opposing regulation for others just another tool of CPA oppression?

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I am no way suggesting that the regulation of unlicensed preparers will permanently eradicate bad tax preparation.

I am merely suggesting that since CPAs, Tax Lawyers and IRS Enrolled Agents are heavily regulated (and by virtue of their education and continuing training are the least likely to engage in unscrupulous conduct) we ought to level the playing field and monitor the rest of the tax preparers, too.

The regulation doesn't have to be all that involved. It could be as simple as requiring tax preparers to register with the IRS and obtain a preparer number.

In order to renew their registration, each preparer might be required to prove that he or she has obtained a minimal level of continuing education credits necessary to keep up with changing tax laws.

What's the big deal?

...

I am proposing that these new regulations ONLY apply to non-CPA, non-lawyer and non-IRS Enrolled Agents who are already regulated under a different regulatory regime.

If you are not a CPA, lawyer or IRS enrolled agent, then, and only then, would you be required to register with the IRS.

My thoughts:

Peter says " It could be as simple as requiring tax preparers to register with the IRS and obtain a preparer number." But he immediately makes it not so simple by adding a CPE requirerement. That alone will require a major IRS bureau to monitor the CPE and registration of tens of thousands of preparers. The vast majority of the preparers covered will be honest ones that are trying their best to make a living helping folks through the tax maze. The dirty preparers will throw together fake CPE, or get cheap CPE credits online, and still continue to be dirty preparers. Except now they will be dirty tax professionals who can call themselves "Officially licensed tax professionals."

Whan has any regulatory regime not expanded? The next time a tax scam involves a lawyer or accountant -- and it will happen -- the IRS or some congresscritter will say the licensing regime should "at least apply the the minimum standards that apply to H&R Block" to lawyers and CPAs. Any new regulation scheme will eventually cover everyone.

What's the big deal? It will waste resources. The bad guys will quickly adapt to the licensing and go on being bad guys. The IRS will spend millions of dollars shuffling paper and bugging people who are late filing their CPE or whose paperwork goes astray. These millions would be better used upgrading IRS data analysis techniques to enable it to spot bad preparers by their data footprint. Cheaters leave tracks all over their returns; sophisticated data mining will be much more effective than collecting tons of CPE paperwork.

More tomorrow.

Related: Yes, I still don't want to regulate preparers

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(peter on Jun 25, 2009 3:37 PM) Joe, I am with you on government waste and inefficiency. I do not favor an ineffective and wasteful regulatory regime. I favor only one that works. You begin with the assumption that none could ever work. And if you start with the presumption that everything the government does is wasteful, then you would have to conclude that the use of taxpayer dollars to "upgrade statistical analyses" would be equally wasteful? If the government is incompetent to monitor un-licensed tax preparers, doesn't it follow that it's incompetent to monitor the returns prepared by them?

Former Newton attorney R. Eugene Knopf has been sentenced to pay more than $26,000 in restitution after pleading guilty to two felony criminal charges for failing to file state income tax returns.

Knopf was placed on probation for five years after District Court Judge Glenn Pille suspended two five-year prison sentences and two $750 fines. He pleaded guilty in February to two of the four counts of fraudulent practice in the second degree, a class D felony, filed against him in April of 2008. His sentencing was on June 5 in Polk County.

According to court records, Knopf intentionally committed fraud by failing to file state income tax returns for four straight years — in fiscal years ending in 2001 to 2004.

Mr. Knopf's non-filing may go back as far as 1993.

There's something puzzling when a lawyer or CPA fails to file returns. Sometimes it's a symptom of a life that has gone off the rails. Sometimes it may be a sort of arrogance - they make their living manipulating the system, and eventually they think they can weasel out of any difficulty. Whatever the reason, it's a crummy way to end a career.

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Now imagine that the penalty for filing a late 1040 were half the balance in your bank accounts, but no less than $10,000.  But that's outrageous - they'd never be that nasty, would they?

Yes they would.  And they are.  Just not for your 1040.

Foreign Bank Account Reports due June 30

The horrific penalty of 50 percent of the highest balance in a bank account for the year, but no less than $10,000, applies for late filers of Form 90-22.1, the Report of Foreign Bank and Financial Accounts. It is due June 30, and no extension is available.   What's worse, you might need to file the form -- sometimes called the "FBAR" form -- even if you don't own a foreign bank account.

You are required to file the FBAR if you are a "United States person" and you have either

- A financial interest, or
- signature authority

over foreign financial accounts exceeding $10,000 in aggregate. 

If your business keeps a bank account in Canada or China because you buy things there, the business needs to file -- as does everybody in your company with signature authority on such an account, down to the payables clerk who signs checks attached to your approved Chinese purchase orders.  An exception may apply to employees of some larger companies.

Of course you don't have to have a business to have a foreign bank account.  The FBAR requirements apply, for example, to personal bank accounts you might have opened while on a temporary overseas assignment.  They also apply to accounts with offshore gambling Web sites.

Be sure to document your filing!  FBAR filings must be postmarked no later than June 30.  While it is always a good idea to send tax filings Certified Mail, Return Receipt Requested, it's especially important with FBAR reports.  Practitioners report that the Detroit Service Center, where the reports are filed, throws away the postmarked envelopes the forms come in.  Then the IRS (outrageously) asserts penalties for forms that come in as early as July 2.  When that happens, a postmarked certified mail receipt, which costs $4.90, can save you $10,000 or more.

If you have missed prior FBAR deadlines, consider taking advantage of the current IRS semi-amnesty that runs into September.

This post originally appeared at Iowabiz.com, the Des Moines Business Record's blog for entrepreneurs.

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I will be unable to address any comments or breaking news until I get back to the intertubes next Monday. Check out the fine tax nerds in the blogroll to your right if you need fresh tax goodness in meantime.

Flikr image of 1965 Scout Handbook courtesy Thomas Duchnicki

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(Robert D Flach on Jun 22, 2009 10:22 AM) JK- Enjoy! Better you than me! TWTP

(Monica Lawver on Jun 23, 2009 7:38 PM) What, no posts from the great outdoors? I thought you were dedicated! Have a great time.

TaxGrrrl seems to be in my corner:

Therein is the problem: will certification actually improve tax compliance and reduce fraud?

Even if it would, how could the IRS possibly regulate the industry? In 2007, there were nearly 138 million individual federal income tax returns filed. Sixty-one percent of those individual federal income tax returns — about 84 million — were completed by paid preparers.

And how would we pay for it? The IRS is already underfunded.

Robert Flach, The Wandering Tax Pro, definitely is not:

It is my firm belief that one of the main reasons why CPA organizations are against the creation of a “licensed tax preparer” designation, via the regulation of unenrolled tax practitioners, is that this will once and for all do away with the misconception that only CPAs are qualified tax preparers.

Trish McIntire is sceptical.

Kay Bell watches from the sidelines, with lots of background and links.

I don't have time to give them the responses they deserve right now, but I think my original rant still stands up - I don't see where any of my points have really been addressed. It takes a great leap of faith to think that licensing will actually solve the problems it is supposed to address, and it takes no leap of faith at all to assume that it will be expensive both for the IRS and for tax prep customers.

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(Peter on Jun 19, 2009 1:05 PM) Joe, And what an excellent rant it was . . . I agree with you that regulation won't "solve" the problem of unscrupulous, incompetent tax preparation. But when does any law regulating or prohibiting conduct ever eliminate that conduct altogether? Never. We have laws prohibiting drug trafficking, yet we still have drug traffickers. We have laws prohibiting drunk driving, yet we still have Dante Stallworth. I am no way suggesting that the regulation of unlicensed preparers will permanently eradicate bad tax preparation. I am merely suggesting that since CPAs, Tax Lawyers and IRS Enrolled Agents are heavily regulated (and by virtue of their education and continuing training are the least likely to engage in unscrupulous conduct) we ought to level the playing field and monitor the rest of the tax preparers, too. The regulation doesn't have to be all that involved. It could be as simple as requiring tax preparers to register with the IRS and obtain a preparer number. In order to renew their registration, each preparer might be required to prove that he or she has obtained a minimal level of continuing education credits necessary to keep up with changing tax laws. What's the big deal?

(Peter on Jun 19, 2009 1:15 PM) Joe, I almost forgot. I am proposing that these new regulations ONLY apply to non-CPA, non-lawyer and non-IRS Enrolled Agents who are already regulated under a different regulatory regime. If you are not a CPA, lawyer or IRS enrolled agent, then, and only then, would you be required to register with the IRS.

(Donna Bordeaux on Jun 22, 2009 3:21 PM) I also do not believe licensing will solve any problems. We should allow the consumer to choose the service they want. This is a case where you still get what you pay for. If you want cheap, you may have issues with quality. If you want quality, expect that there is a price. I feel licensing will just create an "underground" system of preparers who prepare the returns but now do not even sign them.

(Robert D Flach on Jun 23, 2009 10:13 AM) To DB- I expect the "underground" system of unethical preparers who do not sign the tax returns they prepare already exists. To JK- Opponents are constantly saying licensure will be costly for tax pros. I don't see how (see my Comments on a Comment post). Could you tell me what you anticipate licensure will cost the average tax pro? Thanks! TWTP

She says they believe about 187,000 people would ride the train every year. Neads says the train is a very appealing option. "It's a quick turnaround. It's only a five hour ride. The cost is very inexpensive, they're keeping it down at around 42 dollars and it's a very safe, economical, and environmentally friendly way to travel," Neads says.

She says the federal government could pay most of the more than fifty million dollar cost for the route because the midwest is largely underserved, and Illinois and Iowa are working together on the project.

There is so much wrong with this.

- Ridership of 187,000 assumes that everyone in Iowa City takes the trip three times a year, or that everybody in Iowa City and Cedar Rapids, the two towns in the area, rides once a year. It assumes over 500 riders a day, 365 days a year, between Iowa City and Chicago. That's a pipe dream. The two routes serving Iowa now had Iowa boardings at six stations totaling 64,260 in 2008.

- You can make the trip in four hours in a car and leave any time of the day you want, carrying as much stuff as you can fit in the trunk. On a train you can only leave once or twice a day, and only when Amtrak gets around to leaving. You can only pack only as much stuff as you can carry. And even if they are on time, it takes longer than driving.

- If Amtrak's own projections of costs for a route to Dubuque apply, the actual costs of the route will be three times the "economical" $42 ticket price.

But running empty trains is apparently "green," so this could happen in this age of easy federal money.

You can call it "Ozzy Osbourne environmentalism."

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At least 58 proposed projects - mostly involving feature-length films - have applied to receive state tax incentives that are among the nation's most attractive, ranking 2009 as the high-water mark for movie-making interest in the Hawkeye State, state officials said Thursday.

"It's going great guns right now," said Mike Tramontina, director of the state Department of Economic Development. "We've had a big rush."

Wow. The state is running out of money, and it also shoveling it to subsidize carpetbagging filmmakers as fast as it can. Just... wonderful. Imagine how many other industries we could attract if the state paid 50% of their production costs. Sure we'd go broke(er), but imagine the economic development!

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I wonder where the congressman thinks the funding for new miracle drugs come from, if not from drug company profits? And does he think cutting advertising will help with that? Well, keep up the hard work.

Ways and Means Chairman Rangel ponders health care funding at the rental house for which he failed to report rental income for 17 years. (NY Post photo)

Further coverage:

TaxProf
Tax.Com
Peter Pappas

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Once upon a time, there was a summer camp. To entertain the kids, the counselors handed out matches, lighter fluid, and newspapers. The camp burned down.

Afterwards, a white paper was written, proposing more supervision by counselors.

Mr. Kling's post isn't too big to fail, but it is too good to not read.

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Fiscal agency foresees budget gap, lower 2010 revenues

It appears likely all the money in the state of Iowa’s wallet and all of its “overdraft protection” may not be enough to cover the bills coming due at the end of the fiscal year.

Based on current numbers, a Legislative Services Agency fiscal analyst predicted Tuesday the state will spend all of the $45 million ending balance legislators anticipated when they adjourned in April. Gov. Chet Culver has the authority to transfer $50 million from reserve accounts, but that may not cover the bills, the LSA’s Jeff Robinson said.

And:

Despite strained budget, state agency plans $25,000 event at golf tourney

But it's for "economic development," so it's not real money!

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(TaxRascal on Jun 18, 2009 11:02 AM) Phew! It must be pretty stressful to spend so much of other people's money! I'm glad they're taking a chance to unwind.