Alex Muresianu

How the CARES Act Shifted the Composition of Tax Expenditures Towards Individuals

The increase in expenditures associated with COVID-19 relief is another illustration of using the tax code to administer social spending.

Wyden’s Energy Tax Proposal a Mixed Bag

As the Biden administration turns toward infrastructure, Sen. Ron Wyden (D-Or.) has suggested including reforms to the way the tax code subsidizes energy production in such a package, eliminating 44 “tax breaks” for various activities in the energy sector and replacing them with only three.

Phasing in a Corporate Rate Hike Would Be the Worst of Both Worlds

The Biden administration has signaled its openness to raising the corporate tax rate, potentially by phasing in an increase over several years. While phasing in a tax increase, as opposed to hiking immediately, may seem like a reasonable middle ground, it would be the worst of both worlds because it provides old investment with a lower rate while penalizing new investment.

Changes to the Tax Base Matter When Evaluating the Impact of Tax Reforms

A new study illustrates how overlooking an important element of the tax system—the structure of the tax base—can lead to an incomplete understanding of how tax reform impacts the economy.

How Expensing for Capital Investment Can Accelerate the Transition to a Cleaner Economy

Expensing for capital investments is a powerful tax policy for economic growth. But expensing can also help shift the economy to a more sustainable future through increased investment in new, less carbon-intensive technology. Expensing for capital investment would eliminate a tax bias against energy efficiency improvements that reduce operating costs but involve high upfront investments. It could also serve to accelerate the existing trend of movement towards more green energy power sources.

How the CARES Act Fixed a Tax Bias Against Green Investment

One under-discussed part of the CARES Act, passed in March to provide economic relief during the COVID-19 epidemic, is a correction to a drafting error in the Tax Cuts and Jobs Act of 2017, often known as the “retail glitch.”

Estimating Neutral Cost Recovery’s Impact on Affordable Housing

Housing affordability was a major issue even before the COVID-19 crisis, but the current economic situation has made it more salient. Immediate support for people struggling makes sense now, but lawmakers should also consider long-term solutions to the problem of high rents, namely by expanding the supply of housing.

1980s Tax Reform, Cost Recovery, and the Real Estate Industry: Lessons for Today

The Tax Reform Act of 1986 extended depreciation schedules for both commercial and noncommercial of real estate, reducing the attractiveness of those investments.

Attracting Manufacturing to the U.S. Should Start with Neutral Tax Treatment, Not Subsidies

Before considering industry-specific laws and subsidies for onshoring, policymakers should make sure the U.S. tax code is not biased against domestic investment in the first place.

FAQ on Neutral Cost Recovery and Expensing

Cost recovery is the way the tax code permits firms to recover (or deduct) the cost of making investments. Cost recovery plays an important role in defining a business’ taxable income and can impact investment decisions.

Did 1986 Tax Reform Hurt Affordable Housing?

Improving cost recovery for residential structures, while not a silver bullet for solving the housing crisis, would on the margin encourage more construction that would help push rents down across the board.

Why Neutral Cost Recovery Is Good for Workers

Studies have shown that accelerated depreciation helps increase wage growth. A recent report found that states that implemented accelerated depreciation in their tax codes led to a 2.5 percent increase in compensation per employee in manufacturing, relative to states that did not.

What the Internet Can Teach Us About Capital Investment, Infrastructure, and Tax Policy

The lockdowns imposed in response to the COVID-19 pandemic induced an increase in demand for broadband internet, as work from home and other social distancing measures pushed people to spend more time online. As broadband becomes a more important piece of America’s infrastructure, it makes sense to look at tax policy that will help drive more investment and better service.

The TCJA’s Expensing Provision Alleviates the Tax Code’s Bias Against Certain Investments

The Tax Cuts and Jobs Act made significant progress in improving businesses’ ability to recover the cost of making investments in the United States by enacting 100 percent bonus depreciation.

Reviewing Different Methods of Calculating Tax Compliance Costs

Tax compliance creates real costs, which can be calculated. Each method provides unique illustrations of the cost of complying with U.S. tax code.

The Tax Cuts and Jobs Act Simplified the Tax Filing Process for Millions of Households

The newly expanded standard deduction will reduce the time taxpayers spend working on Form 1040 by 4 to 7 percent, translating into $3.1 to $5.4 billion saved annually.

Senator Harris’s Rent Relief Tax Credit is a Well-Intentioned Misfire

The Economics of 1986 Tax Reform, and Why It Didn’t Create Growth

In contrast, the Tax Cuts and Jobs Act lowered the corporate tax rate and allows immediate and full expensing for the next five years.

Making the Tax Cuts and Jobs Act Individual Income Tax Provisions Permanent

If extended, the individual income tax provisions in the Tax Cuts and Jobs Act would increase long-run GDP by 2.2 percent, long-run wages by 0.9 percent, and add 1.5 million new jobs.

Another Look at Reforming the Health Insurance Exclusion