BBB finally hits the House floor. Majority Leader Steny Hoyer said “most of” the floor debate on the House version of President Biden’s Build Back Better Act (BBB) will occur today. “And then,” he told reporters, “I expect a vote on… final passage at the earliest Thursday, and at hopefully the latest on Friday.” But he acknowledged it also could be Saturday. It all appears to depend on the Congressional Budget Office score, which is due Friday.
How much will increased IRS enforcement bring in? CBO Director Phil Swagel continues to signal that a 10-year, $80 billion increase to IRS funding will increase net tax revenue by about $120 billion, far less than the $400 billion estimated by the White House, reports Tax Notes (paywall).
And are the wealthy already adjusting their incomes to avoid higher BBB taxes? US News reports on recent broker experiences. Some wealthy clients already are looking to reduce their 2022 incomes to avoid the $10 million tax threshold for the proposed surtax. They are shifting earnings from pass-through businesses to C corporations. Others plan to avoid the surtax by selling stock this year or by spreading future stock sales over several years.
Same-sex couples may get a tax break from BBB. Taxpayers who were legally married before 2010 could claim federal tax benefits previously unavailable to them. Those couples could file amended tax returns for years as early as 2004—such as filing jointly as a married couple, or claiming refunds and credits that lower their taxes. Of course, some couples might not want to amend their returns since they could end up paying the marriage penalty.
Yellen: US will hit the debt limit on Dec. 15. The Treasury Secretary said the federal government will run out of borrowing authority about two weeks later than earlier estimates. That gives congressional Democrats a bit more breathing room to address the issue.
Speaking of minimizing taxes: State of Tax Justice 2021 reports global corporate tax avoidance costs a half-trillion dollars annually. The report, jointly published by the Tax Justice Network (TJN), the Global Alliance for Tax Justice, and the global union federation Public Services International, relies on self-reported data from multinational corporations and banking data held by governments. It estimates revenue losses through corporate tax minimization and evasion totaled $483 billion in 2021. The United Kingdom was responsible for almost 40 percent of that total. TJN analyst Miroslav Palanský said the lost revenue represents “the tip of the iceberg” and that actual losses from tax avoidance were much higher.
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