Tax Break

Essential reading: Missouri political donor thrives with no limits, and more

October 19, 2012

Welcome to the top tax and accounting headlines from Reuters and other sources.

* Missouri political donor thrives with no limits. Nicholas Confessore – The New York Times. Since 2008, when Missouri abolished contribution limits, donor Rex Sinquefield has donated more than $20 million to local candidates and political action committees. More than half of that money has gone to advance his signature cause: eliminating state and local income taxes in Missouri, a major source of government revenue, and replacing them with sales taxes. Link  

* JPMorgan: If the payroll tax cut falls, so does growth. Suzy Khimm – The Washington Post. JPMorgan no longer thinks the payroll tax holiday will survive the fiscal cliff negotiations. It’s downgraded its GDP growth forecast for the first quarter from 1.5 percent to just 1 percent and revised its second quarter forecast from 2.25 percent to 1.5 percent. Link

* AARP: Please, let payroll taxes go up. Suzy Khimm – The Washington Post. The AARP thinks it’s time for American taxpayers to pony up. The advocacy group for seniors opposes any further extension of the Social Security payroll tax holiday, which is scheduled to expire on Dec. 31, when the rest of the fiscal cliff goes into effect. Link 

* Mitt Romney’s tax increase on poor Americans. Dylan Matthews – The Washington Post. On Wednesday, we took a look at how a $25,000 cap on itemized deductions would affect how Mitt Romney’s income tax cuts break down. The poorest Americans would see their tax bills rise by nearly 2 percent of their income. Link  

* End is nigh for certain tax exemptions. Lisa Prevost – The New York Times. Just as beleaguered borrowers are beginning to feel some relief from a $25 billion deal requiring the nation’s biggest banks to forgive more mortgage debt, another financial threat looms. As it stands now, any mortgage debt forgiven by a lender in a short sale, loan modification or foreclosure is exempt from federal taxation. Link  

* Los Angeles County tax assessor arrested, charged with bribery. Alex Dobuzinskis – Reuters. Los Angeles County’s tax assessor was arrested on Wednesday and charged with accepting bribes from a consultant whose clients he allegedly aided by slashing their property values to save them millions of dollars in taxes, prosecutors said. Link

* Tax group sues Cal State Monterey Bay over Prop 30 advocacy. Evan Halper – The Los Angeles Times. The Howard Jarvis Taxpayers Assn. filed a lawsuit Thursday against a California State University campus, accusing the institution of illegally using taxpayer resources to promote Gov. Jerry Brown’s push for a ballot measure that would raise taxes. The lawsuit comes amid a running dispute between anti-tax activists and the Cal State system over how far university officials can go in encouraging students to vote for Proposition 30. Link  

* Chicago’s Cook County wants tax on bullets to pay for healthcare. Karen Pierog and Mary Wisniewski – Reuters. The top executive of the county that includes Chicago took aim at gun owners on Thursday, proposing a tax on bullets and firearms to help defray healthcare expenses associated with the high rate of gun violence. If approved by the Cook county commission, the nation’s third most populous county could be the first major metropolitan area in the nation to impose a tax as a form of gun control, according to the Law Center to Prevent Gun Violence. Link  

* IRS announces 2013 inflation adjustments. Laura Saunders – The Wall Street Journal. The Internal Revenue Service today announced various inflation adjustments for 2013, including ones for tax-favored retirement plans, gift taxes and long-term care. Link

* Stronger tax revenues boost public finances. Chris Giles – The Financial Times opinion. Stronger revenues in the UK from value added tax, income tax and national insurance contributions boosted the public finances in September, but government borrowing is still off target this financial year. The healthy growth in the main sources of government receipts ensured that public sector net borrowing was lower in September than in the same month a year ago, helping to stem the worrying rise in the deficit this year. Link

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