The Tax Policy Blog

December 22, 2015

The congressional deal on tax extenders includes good news for small businesses, which will enjoy greater certainty under the revised Section 179 provision. At the federal level, expensing levels have been at temporarily increased levels since 2003; under the extenders deal, the current $500,000 expensing level will be maintained in perpetuity. Now it’s the states’ turn to follow suit.

Forty-five states and the District of Columbia allow first-year expensing of small business capital...

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December 22, 2015

Have you calculated your allowable Christmas light wattage yet? Do you know your figgy pudding allocation? If not, be of good cheer, for we at the Tax Foundation bring you tidings of… a tax form, basically. Lump of coal in the stocking for us. Nonetheless, this Christmas season we offer you a new way to assess your level of Christmas cheer. Unfortunately, the instructions sheet has gone missing, so if you get stuck on, e.g., Line 17 (“Mannheim Steamroller expressed as a percentage of all...

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December 21, 2015

During Saturday night’s Democratic presidential debate, each of the three candidates on stage called for higher taxes on wealthy Americans. At one point in the debate, Hillary Clinton called for a new minimum tax on high-income individuals:

Look, I have said I want to be the president for the struggling, the...

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December 18, 2015

Soda taxes are poised to be on the agenda in many cities in 2016, an effort spearheaded by former New York City Mayor Michael Bloomberg. After a long string of rejections—including in New York City itself, where the city that never sleeps refused to sacrifice its caffeine fix—advocates of a tax on sugary beverages finally secured a victory in Berkeley in 2014, a success which advocates hope to parlay into efforts in...

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December 17, 2015

Earlier today, the House of Representatives passed a 233-page tax bill (the PATH Act), which includes over $620 billion in tax reductions for families and businesses. The provisions are a mixed bag: some are principled, sound tax policy, while others are giveaways to narrow interests.

Notably, the bill renews all of the tax extenders –...

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December 17, 2015

Governor Terry McAuliffe (D) released his budget proposal this morning. If passed, his budget would make several changes to Virginia’s tax code.

His plan includes the following changes:

  • Personal Exemption. Governor McAuliffe would increase the personal exemption for individuals and dependents from $930 to $1,000. The exemption for the elderly and the blind would increase from $800 to $900. This is expected to save taxpayers $42 million over two years....
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December 11, 2015

Senator Tom Carper has reportedly proposed a tax credit for oil refineries, as part of the ongoing spending bill negotiations. Such a credit would have several drawbacks: it would make the tax code more complex, reduce federal revenue, and subsidize certain businesses...

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December 11, 2015

When businesses suffer losses in a calendar year, well-structured corporate tax codes allow them to deduct those losses against previous or future tax returns. These provisions are called net operating loss (NOL) carrybacks and carryforwards. While the federal code allows 20 years of NOL carryforwards and 2 years of NOL carrybacks, states vary widely on their net operating loss policies.

Net operating loss deductions are important because many businesses operate in industries that...

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December 10, 2015

Yesterday, Governor Bill Walker, an Independent, announced his fiscal year 2017 budget. The sharp drop in the price of oil has wreaked havoc on Alaska’s budget. The state faces a $3.5 billion deficit for its upcoming budget. To close the budget shortfall, Governor Walker is proposing a litany of new tax increases.

First, Governor Walker proposed...

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December 09, 2015

Yesterday, the Tax Policy Center released their analysis of Governor Jeb Bush’s tax reform plan. They found that if the plan were enacted in 2017, it would cut taxes by $6.8 trillion over the following ten years. They also find that the plan would cut taxes for all income groups, but the largest increase in after-tax income would go to the top taxpayers. In their analysis they did mention that the plan would reduce marginal tax rates on both labor and capital, which could lead to a larger...

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December 08, 2015

In the latest chapter of the tax extenders saga, House Ways and Means Chairman Kevin Brady has introduced a bill to renew all fifty-plus expiring tax provisions until the end of 2016. Last week, lawmakers had been negotiating on a deal to make some of the extenders permanent – which would remove considerable...

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December 07, 2015

Last week, Australia released guidance on its Multinational Anti-Avoidance Law (MAAL), a proposal that introduces a new special tax aimed at deterring multinational corporation from shifting income to low-tax jurisdictions. The underlying structure of the tax proposal is notable because it has important implications for international tax treaty conventions and possibly interferes with parts of the OECD's Base Erosion and...

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December 07, 2015

This week, Jews around the world celebrate the eight-day holiday of Hanukkah. The holiday offers a different message for everyone: for some, it’s about light overcoming darkness and...

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December 04, 2015

Yesterday, I wrote about the income tax burden faced by millennials – the cohort of Americans born between 1980 and 2000. When we examine the IRS data that breaks down tax returns by age, it turns out that millennials don’t pay very much in income taxes. But the same IRS data offers lots of other insights about millennials – how they earn their income, what provisions of the tax code apply to them, and what...

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December 04, 2015

We are pleased to announce the addition of Nicole Kaeding to the Center for State Tax Policy, Kadri Kallas-Zelek and Alex Durante to its Taxes and Growth (TAG) modeling team. The Tax Foundation has grown substantially over the past few years, and the knowledge and experience our newest members bring will help carry that momentum into 2016 and beyond.

Nicole Kaeding is an Economist in the Tax Foundation’s Center for State Tax Policy. Prior to joining the Tax...

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Subscribe to Tax Foundation - Tax Foundation's Tax Policy Blog The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.

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