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Using Private Debt Collectors as a Substitute for the IRS Is a Bad Deal
• By Matthew Gardner
If President Trump is indeed a deal maker, then he should dismantle Congress’s decision to rely on private debt collectors as a substitute for the Internal Revenue Service. This decision, championed for years by Sens. Charles Grassley, R-Iowa, and Chuck Schumer, D-New York, is a lousy deal for everyone--American taxpayers, the federal government--except private debt collectors.
New Tax Breaks for Craft Beer Are a Drop in the Barrel: 76 percent of Tax Bill’s Beer Tax Cut Goes to a Handful of the Biggest Producers
• By Matthew Gardner
The $1.5 trillion tax cut that took effect on Jan.1 was never really going to be about small businesses, despite President Trump’s transparently false claims to the contrary. However, one economic sector still appears happy, for now, to hoist a mug to Congress’s successful sleight of hand: craft breweries.
New Tax Law Allows Affluent Taxpayers to Write off K-12 Private School Tuition
• By Matthew Gardner
Taxpayers are still learning about the intended and unintended consequences of the major tax overhaul that Republican leaders ramrodded through late last year. One little-noted provision subverts state laws that prohibit the use of public dollars for private schools by allowing taxpayers to use 529 plans to pay for K-12 tuition. Until last year, the […]
State Rundown 1/4: Will States Show Resolve in a Challenging Year?
• By ITEP Staff
This week marks the beginning of what is bound to be a wild year for state tax and budget debates. Essentially every state is already working to sort through the complicated ramifications of the federal tax cuts passed in December, including Kansas, Michigan, Montana, and New Jersey highlighted below. These and other states will have important decisions to make about how to incorporate, reject, or mitigate various aspects of the new federal law, and will…
Corporate America, You Just Got a $650 Billion Tax Cut! What Are You Going to Do Next?
• By Matthew Gardner
While many Fortune 500 CEO’s likely had to restrain themselves from preemptively shouting “we’re going to Disneyland” in an homage to the Disney Corporation’s trademark ad spot involving the winner of each year’s Super Bowl, it’s pretty understandable that several of them—including known tax avoiders AT&T, Boeing, Comcast and Wells Fargo—would preemptively make grandiose promises that they will reserve part of their tax cuts for the little people who made it all possible.
State Rundown 12/20: The Days Get Longer from Here
• By ITEP Staff
These have been dark days for those who care about tax justice and public investments, but with the Winter Solstice this week and many states diving into their legislative sessions in January, longer days (and long work days) are soon to come! Governors and legislators are already proposing or hinting at their 2018 tax and budget plans in Alaska, California, Iowa, Maryland, and Washington. And transportation investments are getting strong support in Missouri, Oregon, and…
Final Tax Bill Hits Parents of College Students Harder than Other Taxpayers
• By Steve Wamhoff
While many provisions targeting higher education in previous versions of the tax plan were eventually dropped, little thought has been given to how the bill still raises taxes on parents at the time they are trying to pay for college tuition.
The Trump-GOP’s Big Giveaway to Multinational Corporations
• By Richard Phillips
The tax bill just approved by Congress was a golden opportunity to solve these problems for good—but turned out to be a colossal missed opportunity. Instead of addressing the hundreds of billions in lost federal tax revenue due to offshore tax avoidance schemes, the Trump-GOP tax bill would forgive most of the taxes owed on the profits held offshore right now and open the floodgates to even more offshore profit-shifting in the future.
Corker Claims Provisions Benefiting Him Could Not Have Changed His Vote Because He Never Read the Bill
• By Matthew Gardner
Many Republicans who had previously claimed to be deficit hawks have been cheerfully supportive of major tax-cutting legislation as it has moved forward this fall. But one Republican Senator, Bob Corker of Tennessee, has taken a defiant stance on the issue, insisting that “passing off increased debt to future generations” would be a deal-breaker for him. When the Senate passed its version of the tax plan last week, Corker was the only Republican to vote…
Final GOP-Trump Bill Still Forces California and New York to Shoulder a Larger Share of Federal Taxes Under Final GOP-Trump Tax Bill; Texas, Florida, and Other States Will Pay Less
• By Meg Wiehe
Residents of California and New York pay a large amount of the nation’s federal personal income taxes relative to their share of the population. As illustrated by the table below, the final GOP-Trump tax bill expected to be approved this week would substantially increase the share of total federal personal income taxes (PIT) paid by both states. Connecticut, Maryland, Massachusetts, and New Jersey would also see their share of federal PIT increase.
Final Tax Bill Reported to Provide Senator Rubio With Much Smaller Improvement for Children than He Demanded
• By Steve Wamhoff
The latest news on the GOP tax bill is that, in order to secure the vote of Senator Marco Rubio, Republican leaders have agreed to expand the child tax credit — but only by a fraction of the amount that Rubio initially demanded.
GOP Leaders Scrounge Up Money to Lower Top Tax Rate for the Rich But Not to Help Low-Income Working Families with Children
• By Meg Wiehe
Republican leaders who rejected a proposal to have corporations pay a single percentage point higher tax rate to benefit families with children have tapped the exact same source of savings to provide more breaks for the richest 1 percent of taxpayers. The table below compares the number and share of households nationally and in all 50-states who would benefit from the proposal to reduce taxes for working families with children versus the ”compromise” to cut…
ITEP Resources for the Tax Reform Debate
• By ITEP Staff
ITEP researchers have produced new reports and analyses that look at various pieces of the tax bill, including: the share of tax cuts that will go to foreign investors; how the plans would affect the number of taxpayers that take the mortgage interest deduction or write off charitable contributions, and remaining problems with the bill in spite of proposed compromises on state and local tax deductions.
Private Schools Donors Likely to Win Big from Expanded Loophole in Tax Bill
• By Carl Davis
For years, private schools around the country have been making an unusual pitch to prospective donors: give us your money, and you’ll get so many state and federal tax breaks in return that you may end up turning a profit. Under tax legislation being considered in Congress right now, that pitch is about to become even more persuasive.
State Rundown 12/13: Supermajority Laws Considered in Some States Even as They Confound Others
• By ITEP Staff
Supermajority requirements for tax increases are proving a major obstacle to responsible budgeting in Oklahoma, while ballot initiatives are being filed to alter or abolish Oregon‘s similar requirement, but a similar requirement is slowly advancing toward the ballot in Florida nonetheless. Displeasure with agricultural property taxes are spawning both a ballot initiative drive and a […]
Latest “Compromise” for Tax Plan Is Even Worse than Previous Proposals, Would Reduce the Plans’ “Losers” by Less than 17,000 Taxpayers
• By Meg Wiehe, Steve Wamhoff
Earlier this week, ITEP explained that two possible “compromises” to improve the Senate tax bill would accomplish very little other than make the plan more expensive. Incredibly, Republican leaders are now discussing a third possible “compromise” that is even worse — a further reduction in the top personal income tax rate to 37%. This would […]
Parents of College Students: The Tax Plans’ Losers that No One Is Talking About
• By Steve Wamhoff
Parents of college students or kids in their last years of high school are more likely to face a tax hike than others under the tax legislation moving through Congress. Higher education has entered the tax debate because the House bill (but not the Senate bill) would repeal several provisions that make college and graduate education more accessible. But little thought has been given to how the tax bills would affect the parents of college…
All I Want for Christmas is a Clean DREAM Act
• By Misha Hill
As 2017 draws to close, Congress has yet to take legislative action to protect Dreamers. The young undocumented immigrants who were brought to the United States as children, and are largely working or in school, were protected by President Obama’s 2012 executive action, Deferred Action for Childhood Arrivals (DACA). But in September, President Trump announced that he would end DACA in March 2018. Instead of honoring the work authorizations and protection from deportation that currently…
Who Is “America First” Under the Tax Plan? The Rich First, Foreign Investors Second, Then the Rest of Us.
• By Steve Wamhoff
In his inaugural speech, President Trump told the world that Washington would be driven by a principle of “America First.” But the tax plans moving through Congress only put the richest Americans first. Everyone else comes after foreign investors.
Treasury’s 1-Page Memo Reasserts False Claims that Tax Cuts Largely Pay for Themselves — But Only When Accompanied by Spending Cuts
• By Steve Wamhoff
Treasury Secretary Steven Mnuchin claimed for weeks that his department would release a study showing that the $1.5 trillion tax cut moving through Congress would “pay for itself.” On Monday he released a one-page memo that asserts, without evidence, that economic growth resulting from President Trump’s policies would raise enough revenue to more than offset the costs of the tax cuts.
“Compromises” Under Discussion for the State and Local Tax Deduction Do Not Fix Flawed Tax Bills
• By Meg Wiehe, Steve Wamhoff
Republicans in Congress are reported to be considering two versions of a change they claim would “improve” the current bills by making them more generous to residents of higher-taxed states. As illustrated by these estimates, the reality is that these proposals would make little difference on those states and taxpayers hit hardest.
Even with Potential SALT Compromises, Senate Bill Forces California and New York to Shoulder a Larger Share of Federal Taxes While Texas, Florida, and Other States Will Pay Less
• By Meg Wiehe, Steve Wamhoff
The Senate tax bill, with or without either of the compromises that could be added to it, would shift personal income taxes away from Florida and Texas to states like California and New York, which are already paying a high share relative to their populations.
State Rundown 12/7: States Try to Plan While Awaiting Federal Tax Decisions
• By ITEP Staff
Though most eyes were on Congress rather than states this week, several states have been taking stock of their fiscal situations. Wyoming lawmakers considered ways to resolve budget shortfalls, Kansas and New Mexico legislators got some minor good news about their states' revenues, their counterparts in Minnesota and Vermont grappled with less encouraging revenue news, and those in West Virginia were just happy to hear their revenues had at least met expectations for once.
Charitable, Property Tax, and Mortgage Interest Deductions Would Be Wiped Out for Two-Thirds of Current Claimants Under Congressional Tax Plans
• By Carl Davis
In the ongoing debate over major federal tax legislation, there is significant focus on how House and Senate bills would eliminate the deduction for state income tax payments and cap the deduction for property taxes at $10,000 per year. At the same time, tax writers have retained deductions for charitable gifts and mortgage interest with what appear to be comparatively minor changes, at least at first glance.
They Can’t Help Themselves: GOP Leaders Reveal True Intent Behind Tax Overhaul
• By Jenice R. Robinson
The hand-written scrawls in the margins of the hastily written 500-page Senate tax bill had barely dried when lawmakers began to reveal the true motivation behind their rush to fundamentally overhaul the nation’s tax code.
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