National Taxpayer Advocate calls for penalty relief. Nina Olson told the House Ways & Means Oversight Subcommittee that the IRS should waive penalties for taxpayers who did not have enough tax taken out of their paychecks or failed to make large enough estimated payments through 2018. Because the Tax Cuts and Jobs Act was in effect for the first time in 2018, many taxpayers did not have the correct amount of tax withheld. Treasury had agreed to the waiver for those who paid 80 percent of their tax liability. Olson also told the panel that so far this tax season the IRS has answered only 18 percent of calls on its account management lines.
Presidential Tax Returns: What should House Democrats request? TPC’s Steve Rosenthal has an opinion about which of Donald Trump’s returns House Ways & Means chair Richard Neal should request. Rosenthal concludes that “ordinarily, a president’s personal tax returns would be sufficient for oversight purposes. But Trump’s business and financial interests are more extensive than any past president. And he refuses to divest his sprawling business empire or transfer his interests to a blind trust. Given these unique circumstances, Neal needs to request both President Trump’s personal and business tax returns.”
And what will Mnuchin say? After a nearly two-month delay, Treasury Secretary Steven Mnuchin finally will testify before the Democratically controlled House Ways & Means committee on March 14. Officially, the hearing will be about President Trump’s budget request for the Treasury Department, but members are sure to ask him about Trump’s tax returns, trade policy, the TCJA, and the tax filing season.
More Michigan tax proposals… Democratic Governor Gretchen Whitmer wants to increase some business taxes to cover the cost of repealing the state’s 2011 tax on pension income. Whitmer wants to provide tax relief to seniors, but her plan would raise taxes on about 150,000 businesses. She’d tax pass-through business income at the same rate as corporate income.
Will New York State fund the MTA with a tax on pied-à-terres? The Metropolitan Transit Authority, the nation’s largest transportation network, faces a budget shortfall. State legislators would close the gap with a levy on the wealthiest of the wealthy property owners and New York City Council members support the tax, which could raise as much as $9 billion over six years. New York State budget director Rorbert Mujica also says the tax might be needed. Fixing the MTA’s subways would cost about $40 billion according to its 2020-2024 capital investment plan.
Polk County, Iowa, voters overwhelmingly approve a sales tax increase. The tax hike failed in three previous elections, but the fourth time was the charm. Seventy percent of voters in Des Moines and majorities in five other cities in the county approved a 1-cent sales tax increase that could raise $48.4 million annually. That revenue will be used to reduce property taxes and pay for some civic projects.
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