Klobuchar would raise some capital gains taxes, impose a Buffett tax. To pay for free community college and expanded college loans, Democratic presidential hopeful Sen. Amy Klobuchar (D-MN) would raise capital gains and dividend tax rates for those in the top two income tax brackets and impose a 30 percent federal minimum tax for those with incomes over $1 million. Klobuchar has co-sponsored such Buffett rule legislation since at least 2017.
Absent a tax extender, will more foreclosed home owners declare bankruptcy? Until 2018, homeowners could exclude from taxable income up to $2 million in forgiven mortgage debt upon foreclosure or short sale of their homes. Bloomberg Law explains that bankruptcy—when such forgiven debt can still be excluded-- may now be their best option. More bankruptcy filings could have negative economic effects, however.
Colorado and Texas voters face big tax questions this year. TPC’s Richard Auxier explains the tax policy questions facing these voters next month. Colorado voters must decide whether to loosen the state’s Taxpayer Bill of Rights (TABOR) so it could use some excess tax revenue to fund education and transportation. And a Texas referendum aimed at banning a state personal income tax could have the unintended consequences of repealing its business franchise tax, major source of revenue.
Utah’s GOP wants to cut income tax rates for top earners. The state tax reform task force has a $128 million plan to cut state income tax rates. Forty percent of that tax relief would go to the 20 percent of the state’s taxpayers who earn $113,000 a year or more.
A Kentucky college wants relief from Treasury college endowment tax rules. Roll Call reports that Berea College—a small Kentucky school with an unusually large endowment--still is subject to a 1.4 percent tax included in the Tax Cuts and Jobs Act. Berea owes $1 million annually despite efforts by its home state senator, Majority Leader Mitch McConnell, to protect the college. The school claims should be exempt from the tax because it uses its endowment to pay student tuition. But Treasury issued guidance last month that begs to differ. Berea has asked Treasury to consider modifying the guidance and has joined with 40 other colleges, including seven Ivy League schools, in an effort to convince Congress to repeal the tax.
For the latest tax news, subscribe to the Tax Policy Center’s Daily Deduction. Sign up here to have it delivered to your inbox weekdays at 8:00 am (Mondays only when Congress is in recess). We welcome tips on new research or other news. Email Renu Zaretsky at firstname.lastname@example.org.
Posts and comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.
- © Urban Institute, Brookings Institution, and individual authors, 2016.