The nation will hit the debt ceiling on Thursday. Treasury Secretary Janet Yellen warned Speaker Kevin McCarthy that the US is projected to reach its $31.4 trillion debt limit in two days. Treasury will begin taking “extraordinary measures” to prevent default, including temporarily limiting the bonds it sells to the federal employee retirement fund. But these measures may only last until June.
OECD names Manal Corwin as tax boss. She will become the next Director of the OECD’s Centre for Tax Policy and Administration beginning on April 3. Currently partner-in-charge of the National Tax Office of the consulting/ accounting firm KPMG, she served as Deputy Assistant Secretary for International Tax Affairs at the US Treasury. She has long experience in international tax issues and a key part of her job will be to lead the implementation of the OECD’s corporate tax reforms. She’ll replace Pascal Saint-Amans.
The 2023 tax season opens next week. The IRS set Monday, Jan. 23, as the official start to the 2023 tax filing season. The agency expects over 168 million individual tax returns, most of which will arrive before this year’s April 18 due date. Tax Day will be delayed because April 15 falls on a Saturday and the District of Columbia's Emancipation Day holiday is on Monday, April 17.
What can help new mothers better understand tax filing and access tax benefits? According to a TPC survey: Trusted advisors like nurses can help new mothers and others in low-income populations better access tax benefits. Researchers surveyed 1,500 clients of the Nurse-Family Partnership, half of whom worked with a tax filing assistance program called Let’s Get Set.
Forthcoming paper: The SALT cap should apply to passthrough entity owners. In 27 states, passthrough business owners can avoid the federal $10,000 cap on state and local tax deductions by paying entity-level state income taxes. While the IRS allows the workaround, NYU Law Professor Daniel Hemel, in a paper forthcoming in the Florida Tax Review, argues the scheme could cost the federal government more than $50 billion by the end of 2025, with most benefits flowing to passthrough owners earning $1 million or more.
Trump Organization sentenced to pay $1.6 million for New York tax fraud scheme. A Manhattan Supreme Court Justice imposed the maximum sentence on the organization. Trump Organization subsidiaries, Trump Corp. and Trump Payroll Corp., were convicted last month on 17 counts of conspiracy, criminal tax fraud, and falsifying business records over 15 years.
This week’s Prescription: The debate over the Child Tax Credit continues on Thursday’s episode of TPC’s webcast The Prescription. This week’s guest will be AEI senior fellow Scott Winship, who will discuss his view that the expanded CTC’s disincentives to work will hurt low-income families in the long run.
The Daily Deduction resumes its regular schedule on Monday, Jan. 23.
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