In a contribution to the Policy Dialogue on Entrepreneurship blog of Kauffman.org. Joseph Rosenberg and Donald Marron examine how tax policy affects investment incentives for startup companies. Startups often make losses, and thus cannot make immediate use of the R&D tax credit, accelerated...
As income increases, the composition of income changes substantially. For most taxpayers, salaries and wages contribute the most. But higher-earners typically report income from capital gains and businesses.
We examine how tax policies alter investment incentives, with a particular focus on startup and innovative businesses. Consistent with prior work, we find that existing policies impose widely varying effective tax rates on investments in different industries and activities, favor debt over...
The composition of reported income has changed markedly since 1952. Investment income has continued to grow, along with business income, interrupted only by periodic economic downturns. Meanwhile, salaries and wages have declined as a share of income.
In a recent Tax Notes article, Shay argued that Treasury could write regulations to reduce the tax incentives for U.S. corporations to expatriate. Rosenthal agrees with Shay and analyzes the legal support for regulations under section 385.
This Tax Fact documents the increasing share of flow-through business income as a percentage of adjusted gross income (AGI) reported on individual income tax returns. In 2012, net income from sole proprietorships, partnerships, and S corporations totaled nearly $840 billion and accounted for...
Recently, there has been a spate of corporate inversions, where U.S. multinational corporations have combined with foreign companies, arranging their corporate structure to locate the residence of the resulting corporation in a foreign country with an attractive corporate tax climate. This paper...
In a contribution to the Wall Street Journals MarketWatch Inc., Eric Toder and Alan Viard argue that recent highly publicized tax avoidance transactions by U.S. corporations reflect basic flaws in how we tax the income of multinational corporations, and that proposed reforms that maintain...
In a contribution to The Wall Street Journal's MarketWatch, Eric Toder explains why corporations expatriate from the United States and argues that they will continue to do so until Congress addresses the fundamental flaws in the corporate income tax. He then provides some possible solutions to...
Tax Reform and Small Business
Eric Toder testified about tax reform and small business, before the House Committee on Small Business on April 15, 2015.
How Much Do Taxes Affect Startup Investment Incentives
In a contribution to the Policy Dialogue on Entrepreneurship blog of Kauffman.org. Joseph Rosenberg and Donald Marron examine how tax policy affects investment incentives for startup companies. Startups often make losses, and thus cannot make immediate use of the R&D tax credit, accelerated...
Composition of Income Reported on Tax Returns in 2012
As income increases, the composition of income changes substantially. For most taxpayers, salaries and wages contribute the most. But higher-earners typically report income from capital gains and businesses.
Tax Policy and Investment by Startups and Innovative Firms
We examine how tax policies alter investment incentives, with a particular focus on startup and innovative businesses. Consistent with prior work, we find that existing policies impose widely varying effective tax rates on investments in different industries and activities, favor debt over...
Changes in Income Reported On Federal Tax Returns
The composition of reported income has changed markedly since 1952. Investment income has continued to grow, along with business income, interrupted only by periodic economic downturns. Meanwhile, salaries and wages have declined as a share of income.
Professor Shay Got It Right: Treasury Can Slow Inversions
In a recent Tax Notes article, Shay argued that Treasury could write regulations to reduce the tax incentives for U.S. corporations to expatriate. Rosenthal agrees with Shay and analyzes the legal support for regulations under section 385.
Flow-Through Business Income as a Share of AGI
This Tax Fact documents the increasing share of flow-through business income as a percentage of adjusted gross income (AGI) reported on individual income tax returns. In 2012, net income from sole proprietorships, partnerships, and S corporations totaled nearly $840 billion and accounted for...
Corporate Inversions
Recently, there has been a spate of corporate inversions, where U.S. multinational corporations have combined with foreign companies, arranging their corporate structure to locate the residence of the resulting corporation in a foreign country with an attractive corporate tax climate. This paper...
Corporate Tax is Broken and Needs Major Surgery
In a contribution to the Wall Street Journals MarketWatch Inc., Eric Toder and Alan Viard argue that recent highly publicized tax avoidance transactions by U.S. corporations reflect basic flaws in how we tax the income of multinational corporations, and that proposed reforms that maintain...
How To Stop Corporations From Fleeing U.S. Tax Laws
In a contribution to The Wall Street Journal's MarketWatch, Eric Toder explains why corporations expatriate from the United States and argues that they will continue to do so until Congress addresses the fundamental flaws in the corporate income tax. He then provides some possible solutions to...