Tag Archive for Tax Reform

13 Reasons Why I Committed Citizide

In a recent submission to Senator Hatch, I argued that what the United States thinks of as “citizenship-based taxation”, is actually a system where the United States imposes U.S. taxation on the residents and citizens of other countries. That submission included:

On August 2, 2017 posts at the Isaac Brock Society and numerous other sources, reported that that there were 1759 expatriates reported in the second quarter report in the Federal Register. The number of people renouncing U.S. citizenship continues to grow. Read More

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The Exit Tax Is A Perfectly Bad Idea

This post is based on (but is NOT identical to) a July 17, 2017 submission in response to Senator Hatch’s request for Feedback on Tax Reform.

Why is the United States imposing an “Exit Tax” on their “non-U.S. pensions” and “non-U.S. assets”? After all, these were earned or accumulated AFTER the person moved from the United States?”

Part A – Why certain aspects of the Exit Tax should be repealed Read More

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20th Anniversary IRS Restructuring Commission Report

In the 1990s, tax reform was about as big of a focal point as it is today.  Some of the reasons were rate reduction and international competitiveness. There were a few concerns about IRS activities, such as a technology modernization effort that cost over $2 billion with little results. A commission was created by P.L. 104-52 (11/19/95). This 17-member group was the National Commission on Restructuring the IRS, co-chaired by Senator Kerrey (D-NE) and Congressman Portman (R-OH). Read More

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Testimony To Senate Small Business Committee For AICPA

Annette Nellen

On June 14, 2017, I had the privilege to testify on behalf of the AICPA before the Senate Committee on Small Business & Entrepreneurship. The title of the hearing – Tax Reform: Removing Barriers to Small Business Growth. A goal of the hearing was for this committee to help the Senate Finance Committee know that they want to be sure tax reform helps small businesses and that such businesses are not forgotten in efforts to reduce the corporate tax rate. Read More

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Open Letter On Tax Reform To Administration And Congress

Kat Jennings

Open Letter to President Trump, Treasury Secretary Mnuchin, House Speaker Paul Ryan, House Ways and Means Committee Chairman Kevin Brady, and Senate Finance Committee Chairman Orrin Hatch

The United States taxes individuals on the basis of citizenship. In other words, it taxes American citizens on their worldwide income regardless where they reside, the source of their income, whether they are or ever have been present in the US – in short, regardless of anything.

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Written by | Posted in Citizenship

Tax Principles For The Digital Age

Annette Nellen

At the start of the 21st century, I was involved with a project with the AICPA on tax reform. An outcome of our task force work was a set of ten principle of good tax policy. The goal was for lawmakers to apply these to both existing tax rules and proposals for change to identify where they did and did not meet the principles. Where not met, hopefully improvement could be made.

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President Trump’s 1-Page Tax Plan

Annette Nellen

Members of President Trump’s cabinet (Secretary Mnuchin and National Economic Director Gary Cohn) released a 1-page list of items he wants in a tax reform plan. CNN has the 1-pager posted here.

A few observations (I’ll have more later):

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Written by | Posted in Donald Trump Tax Plan

Tax Reform in 2016?

Annette Nellen

While we are unlikely to see tax reform this year, there continues to be a lot of work going on in the tax committees on it.  And President Obama updated and released his framework for business tax reform this month (first report was released in Sept. 2012). I think the main impetus for the update was to address inversions to tie to the recent activities of IRS and Treasury. Read More

Written by | Posted in Tax 2016 • Tax Reform

10th Anniversary of Bush Tax Reform Report

In January 2005, President Bush created his Advisory Panel on Federal Tax Reform. It was tasked to examine the tax system and propose simplified options that were revenue neutral, pro-growth and internationally competitive. One option was to be a consumption tax. The report was due and was issued on November 1, 2005.

The panel held public hearings, reviewed lots of data and studies and suggested reforms. One of their initial findings was the high cost of tax system complexity which they estimated to be $140 billion per year. Per the panel:

“To put this amount in perspective, it is roughly the same as giving $1,000 to every family in America or the amount of money needed to fund all of the following: the Department of Homeland Security, the State Department, NASA, Read More

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Politics And Taxes – Why Call For Abolishing The IRS?

We now have two presidential candidates who promote abolishing the IRS – Senator Ted Cruz and Senator Rand Paul. (For example, see Christian Science Monitor of 3/25/15 on Cruz and Citizens United on Paul.) Why would they make such an odd statement? They must know that a government agency is needed to help taxpayers comply with the tax law, collect taxes, and use audits and other techniques to be sure taxpayers have properly computed and paid their taxes. While both men also call for tax reform, there would still be taxes. And there would still be complexities. The size of a tax return (such as a postcard) does not mean it is simple. It all depends on how much information is summarized and given to the IRS. Today’s income tax could go on a postcard (total income less deductions, and the net tax); it would still be complicated to compute these figures. Read More

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Filing Status Challenges And Developments

This year there were a few cases and IRS rulings where a married couple tried to change their filing status. Two of the cases involved a couple who split up at year end (before the time to file that year’s return). The cases are a reminder of the rule on when a married couple may amend a return to change from MFS to MFJ (before the statute of limitations runs out) and from MFJ to MFS (before April 15).

Also, in 2014, a few states that did not recognized same-sex marriage now due because of litigation challenging state law (such as Virginia and Wisconsin).

We probably think that identifying your filing status for your income tax return is one of the easiest things to do. These cases show that there can be challenges. Read More

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The Election, 114th Congress And Fate of Tax Reform

What does the change in majority party in the Senate for the 114th Congress mean for tax reform, and perhaps for any tax legislation?

An op ed in the Wall Street Journal on November 5, 2014 by Congressman Boehner and Senator McConnell, states that the Republican controlled Congress will address many challenges including “The insanely complex tax code that is driving American jobs overseas.”

What might that mean? A few possibilities:

Nothing. Complexity is not a bi-partisan issue. There is no contrary argument to the statement that our federal tax law is too complex. So, why hasn’t the complexity been Read More

Written by | Posted in Tax Provision/Tax Reporting
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