Tues, Oct. 22, 2024: IRS releases new tax brackets for 2025
Fri, Oct. 18, 2024: IRS reports that the tax gap for tax year 2022 was nearly $700 billion — the amount of taxes owed but not paid.
Mon, May 11, 2024: Bloomberg reports, Trump Pledges Across-the-Board Tax Cuts If He Returns to Office. This, in the wake of last week’s Congressional Budget Office estimates that extending Trump’s 2017 tax cuts would add more than $4 trillion to deficits over the next 10 years.
Wed, May 8, 2024: Congressional Budget Office released its analysis of alternative budgetary outcomes under alternative assumptions. “The report includes 10 alternative assumptions—3 about discretionary spending and 7 about policies affecting revenues.” Notably:
-“most of the individual income tax provisions of the 2017 tax act (TCJA) are slated to expire at the end of calendar year 2025. The expiring provisions affect major elements of the individual income tax code, including the statutory tax rates and brackets, the allowable deductions, the size and refundability of the child tax credit, the 20 percent deduction for certain business income, and the income levels at which the alternative minimum tax takes effect. According to JCT’s (Joint Committee on Taxation’s) estimates, if the expiring individual income tax provisions of the 2017 tax act were extended, primary deficits over the 2025–2034 period would be $3.3 trillion larger….Increased net outlays for interest would add $467 billion to those deficits..”
-“The 2017 tax act also temporarily doubled the exemption amount for estate and gift taxes. That change expires at the end of calendar year 2025. If that expansion was extended, primary deficits over the 2025–2034 period would be $167 billion larger…. Increased net interest outlays would add $22 billion to those deficits.”
-“The 2017 tax act temporarily expanded a provision known as bonus depreciation, which allows businesses to immediately deduct a portion of the cost of certain investments. That law increased the deductible amount to 100 percent of the cost of such investments through calendar year 2022 but set the provision to be phased out thereafter. In calendar year 2023, 80 percent of the total eligible cost could be deducted, and this year, 60 percent is deductible. The deductible portion is scheduled to fall to 40 percent next year, to 20 percent in calendar year 2026, and to zero the following year. Extending that provision by permanently setting the deductible portion to 100 percent (including retroactively for 2023) would result in primary deficits over the 2025–2034 period that were $378 billion larger than those in CBO’s baseline, JCT estimates. Increased net interest outlays would add $91 billion to those deficits.”
-“Some provisions of the 2017 tax act that affect business taxes have scheduled expiration dates or include changes that do not take effect for several years. Scheduled changes include reductions in the size of the deduction for certain types of foreign income and an increase in the tax rate applied for the base erosion minimum tax (a provision put in place to keep corporations from avoiding tax liability by shifting profits out of the United States). If those scheduled expirations and changes did not occur, primary deficits over the 2025–2034 period would be $172 billion larger than they are in CBO’s baseline projections, JCT estimates. Increased net interest outlays would add $25 billion to those deficits.”
Mon, May 6, 2024: Politico reports that Senate Finance Chair Ron Wyden will try to attach the bipartisan tax bill to the upcoming FAA reauthorization bill.
Thurs, May 2, 2024: The Washington Post reports that a “GOP split could doom the bipartisan child tax credit bill.” Also Thursday, the IRS released a plan to increase its audit rate for taxpayers earning more than $10 million by about 50%, according to an updated operating plan.
Wed, April 9, 2024: NBC’s Sahil Kapur: “Senate Republicans are inching closer to burying a bipartisan bill to expand the child tax credit and provide breaks for businesses, issuing a series of demands that would most likely disrupt the coalition that enabled it to pass the House. … [Senate Finance ranking member MIKE] CRAPO told NBC News on Tuesday that he still has problems with ‘a number’ of provisions,” reports Politico (emphasis added).
Thurs, March 8, 2024: Tax highlights from State of the Union:
- Increase the top corporate income tax rate to 28%.
- Raise the minimum corporate income tax rate to 21% up from the current level of 15% as set by the Inflation Reduction Act of 2022.
- Institute a minimum income tax of 25% for the wealthiest 0.01% of households.
- Raise the Medicare tax rate on incomes over $400,000.
- Eliminate the deductibility of compensation costs for salaries of more than $1 million a year.
- Raise the tax on stock buybacks to 4%, quadrupling the current rate of 1%.
- Increase the Child Tax Credit, restoring the refundable credit that was in place during the pandemic.
- Make permanent the enhanced subsidies for health insurance purchased on the exchanges created by the Affordable Care Act, which are currently scheduled to expire after 2025.
- Renew the 2017 tax cuts for those earning less than $400,000 a year, ending them for those who earn more.
- New $5000 tax credit for first-time home buyers.
Wed, March 6, 2024: The House-passed child tax credit and business extenders package continues to languish in the Senate, reports Politico.
Fri, March 1, 2024: Wall Street Journal reports that opposition from GOP Senators is holding up Senate action on HR. 7024, the Child Tax Credit and business extenders package, that passed the House 357-70.
Thurs, Feb. 29, 2024: CBO issued report: “How Changes in Funding for the IRS Affect Revenues.”
Wed, Feb. 14, 2024: The Rule to enable consideration of HR 7160, to increase the cap on the state and local tax deduction, failed 195-225.
Mon, Feb. 12, 2024: Politico reports that “a good number of Senate Republicans are trying to slow walk the bipartisan tax bill that sailed through the House late in January.”
Thurs, Feb. 1, 2024: House Rules Committee reported a closed rule for consideration of HR 7160, a bill to boost the cap on State and Local Tax deductions. Roll Call reports prospects for adoption of the rule to allow consideration of the bill are slim.
Wed, Jan. 31, 2024: House passed HR. 7024, the Child Tax Credit and business extenders package, 357-70 (under suspension of the rules, 2/3 required). In order to clear the way for passage, Speaker Johnson agreed to a separate vote, as early as next week, on relief from the cap on deduction of State and Local Taxes (SALT), reports Roll Call. The legislation now moves to the Senate, where the bill will require 60 votes for passage–a tall order in an election year. Politico reports that Senate Republicans want to toughen requirements for Child Tax Credit eligibility.
“Tax deal likely much more expensive than official estimate, experts warn,” reports The Hill.
Tues, Jan. 23, 2024: Ways & Means reported H.R. 7024, the Tax Relief for American Families and Workers Act of 2024. H.Rpt. 118-353. CBO estimate.
Fri, Jan. 19, 2024: Ways and Means Committee voted 40-3 to report a $78 billion package of tax extenders and revival of a slimmed down child tax credit expansion negotiated by Chairman Jason Smith (R-MO) and Senate Finance Chairman Ron Wyden (D-OR). The extenders include expensing of R&D, a more generous interest deduction, and expensing of business investments. The bill would be offset by accelerating expiration of the Employee Retention Tax Credit. The White House said the President will sign the bill if it clears Congress. Tax Policy Center Analysis
Sat, Jan. 6, 2024: Bloomberg reports “Trump plans to make permanent the 2017 individual tax cuts that he enacted as president while keeping corporate tax levels unchanged….Trump’s preference to keepthe 21% corporate rate marks a shift from his desire while president to lower the corporate rate to 15%, which generated opposition from both Republicans and Democrats. While the 21% tax rate is permanent, his 2017 tax cuts for individuals are set to expire after 2025. Those cuts overwhelmingly benefit wealthy households, small business owners and those in the real estate industry.”