Friday, August 31, 2012

When Taxing Social Security, What is Social Security?

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Most retired people, and many not-yet retired people, know that social security benefits are subject to federal income taxation. Describing ...
Wednesday, August 29, 2012

More on Income Averaging

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After my post in which I asked Where Are You, Income Averaging? , an alert reader pointed out that a type of income averaging was revived fo...
Monday, August 27, 2012

Using Taxes to Measure Generosity

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A recent report about the level of charitable giving is certain to generate all sorts of debates about the meaning of its conclusions, but ...
Friday, August 24, 2012

Where Are You, Income Averaging?

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Decades ago, when the federal income tax rate structure included as many as 24 different rates, with the highest reaching 91 percent, the ta...
Wednesday, August 22, 2012

How Not to Claim a Casualty Loss Deduction

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The experience of the taxpayer in Beach v. Comr. , T.C. Summ. Op. 2012-81, demonstrates how easy it is for a taxpayer to make errors when f...
Monday, August 20, 2012

Playing With Tax Numbers

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Over at Forbes Magazine , Nick Schulz brands Exxon-Mobil a “Tax Hero” for paying three times as much in taxes, to governments world-wide, as...
Friday, August 17, 2012

The Tax People Ask, “What is a Telephone Company?”

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A recent case, Alltel Communications Inc v. South Carolina Department of Revenue , No. 27156 (8 Aug. 2012), demonstrates yet again why the ...
Wednesday, August 15, 2012

In Tax, It Almost Always Depends. Generally.

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For as long as I have been teaching, students in my tax classes have been amused or frustrated by the frequency with which “it depends” surf...
Monday, August 13, 2012

The (Tax) Fraud Epidemic

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From a tax perspective, there’s a little something to be said about the value of those television court shows. Twenty months ago, in Judge J...
Friday, August 10, 2012

You Get What You Vote For

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At the end of July, voters in Georgia had the opportunity to approve or reject, through a referendum, a one percent increase in the state sa...
Wednesday, August 08, 2012

The Tax Consequences of Being Paid to Date: The Sequel

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Regular readers can easily guess what went through my mind when I picked up the Philadelphia Inquirer and saw this report . Apparently Nadya...
Monday, August 06, 2012

Sometimes When It Comes to Tax Violations, Voters Get It Right

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Indeed, sometimes voters get it right but too often it takes way too long. This was demonstrated recently in the case of Philip Lewis Hart, ...
Friday, August 03, 2012

A Tax What-If

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Suppose for a moment that the Bush tax cuts are extended for taxpayers with taxable income of less than, say, $250,000. Is it possible for t...
Wednesday, August 01, 2012

Why Tax Statutes Are Long and Could Be Longer

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Recently, in Carlebach v. Comr. , 139 T.C. No. 1 (July 19, 2012), the Tax Court upheld the validity of a regulation dealing with the definit...
Monday, July 30, 2012

The Importance of Tax Record Keeping

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It is not difficult to find professionals who advise, whether in person, on web sites, or otherwise, that tax records should be retained for...
Friday, July 27, 2012

Federal Ready Return: Index

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Several readers requested an index to the series of posts on the federal Ready Return proposal. Here it is. Federal Ready Return, Part One:...

The Limits of Taxation

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In the current atmosphere of anti-taxation sentiment, opposition to tax increases, and efforts to curtail government, it was surprising but ...
Wednesday, July 25, 2012

Federal Ready Return, Part Fourteen: Conclusion

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The nation is not ready for federal Ready Return. Nor will it ever be, until and unless the federal income tax law is overhauled. Ready Retu...
Monday, July 23, 2012

Federal Ready Return, Part Thirteen: IRS Authority

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Ready Return is something that the IRS has authority to implement. Section 2004 of the Internal Revenue Service Restructuring and Reform Act...
Friday, July 20, 2012

Federal Ready Return, Part Twelve: Taxpayer Acceptance

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Ready Return will not work if taxpayers do not accept it. All indications are that Ready Return will fall flat. As I pointed out in First ...
Wednesday, July 18, 2012

Federal Ready Return, Part Eleven: Conflict of Interest

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Ready Return creates a conflict of interest, not, as some claim, because it gives the IRS the dual roles of tax return preparer and tax coll...
Monday, July 16, 2012

Federal Ready Return, Part Ten: IRS Capacity

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Ready Return would impose significant demands on IRS resources. Imposing Ready Return on an IRS saddled with computer system problems is unw...
Friday, July 13, 2012

Federal Ready Return, Part Nine: Economic Impact

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Ready Return proponents claim that it will save people several billion dollars in taxpayer return preparation fees. If that’s true, that put...
Wednesday, July 11, 2012

Federal Ready Return, Part Eight: Burden on Business

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In order for Ready Return to work, even putting aside all of its other flaws, the IRS would need W-2 and 1099 2 forms to be submitted earlie...
Monday, July 09, 2012

Federal Ready Return, Part Seven: Taxpayer Acquiescence

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Another danger of the Ready Return method is that it can induce taxpayers to accept IRS positions to which they would object if raised durin...
Friday, July 06, 2012

Federal Ready Return, Part Six: Security Risks

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Ready Return poses serious security risks for taxpayers, particularly if the system is set up in a manner that requires taxpayers to access ...
Wednesday, July 04, 2012

Federal Ready Return, Part Five: Efficiency

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Advocates of Ready Return claim that it saves people time. After I shared my opinions about Ready Return on public radio , as described in F...
Monday, July 02, 2012

Federal Ready Return, Part Four: The Persistence of the Tax Gap

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The IRS claims that this system would eliminate the tax gap, estimated between an $300 and $400 billion annually. See Daniel Horowitz, The I...
Friday, June 29, 2012

Federal Ready Return, Part Three: Income Tax Return Accuracy

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Though Ready Return advocates praise their proposal as a generator of increased tax return accuracy, the reality is quite different. To assu...
Wednesday, June 27, 2012

Federal Ready Return, Part Two: The Value of Self-Compliance

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Federal Ready Return will erode the value of the self-compliance principle of the federal income tax system. There is a very good reason th...
Monday, June 25, 2012

Federal Ready Return, Part One: Introduction

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For quite some time, I have been an outspoken critic of the Ready Return concept, which was adopted in California but which has not taken of...