Inside Government Crackdown on Corporate Jet Tax Abuse
Talking Tax
by Bloomberg Tax
5h ago
The corporate jet industry is the latest to be targeted by the government's efforts to make the rich pay the taxes they owe. The IRS began an audit campaign in February to clamp down on executives abusing corporate jet tax breaks for personal use. President Joe Biden's proposed budget would tighten depreciation rules and increase the tax rate on private jet fuel, and Senate Democrats sent a letter urging the Treasury Department and Internal Revenue Service to change how corporate jet owners deduct certain costs. Bloomberg Tax reporter Erin Schilling spoke with Michael Kaercher, a senior attorn ..read more
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Investors Await Companies Dishing Out More Tax Details
Talking Tax
by Bloomberg Tax
6d ago
Coming soon to corporate financial statements: a lot more tax transparency. After seven years and three rounds of proposals, the Financial Accounting Standards Board in December published new rules requiring companies to shed light on the income taxes they pay to federal, international, and state governments. The disclosure rules, which kick in as early as 2025, are a response to years of complaints that current financial reporting rules offer too few details about tax obligations. Soon, companies will have to separately list any jurisdiction that accounts for more than 5% of their total tax o ..read more
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New IRS Tool for Free Tax Return E-Filing Is Live
Talking Tax
by Bloomberg Tax
2w ago
Many taxpayers with relatively simple returns can now electronically file their returns directly with the IRS for free for the first time. The IRS, after months of preparing its government-run free e-filing pilot tool, launched the program to the wider public Tuesday. The Treasury Department expects about 100,000 of the millions eligible to use it. Democrats’ Inflation Reduction Act set aside $15 million for the IRS to issue a report on the feasibility of creating a direct e-filing tax return system. The pilot comes after years of controversy and pushback from Republicans and tax-prep software ..read more
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Tough Australian Tax Weapon Gets Court's Go-Ahead
Talking Tax
by Bloomberg Tax
2w ago
Australian authorities continue to crack down on multinational companies it believes are trying to avoid Australian taxes—and a recent court ruling against PepsiCo Inc. gives them a tough weapon. A judge ruled in November that sales of beverage concentrate from a Singapore Pepsi affiliate to an Australian Pepsi bottler also effectively included royalties for the use of Pepsi trademarks and intellectual property that the company should have been taxed on. But for the first time, the judge also blessed the use of Australia’s “diverted profits tax,” or DPT, which slams companies with a 40% tax ra ..read more
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IRS Eyes Sports Team Owners Reaping Big Tax Benefits
Talking Tax
by Bloomberg Tax
1M ago
Sports team owners for decades have seen enormous tax benefits from their team purchases, dispatching squads of accountants to find write-offs on things from equipment and player salaries to TV rights and more. Now the IRS is looking to make sure all of those savings were above board. The IRS's Large Business and International Division announced the audit campaign last month, making sure the income and deductions taken by sports-related partnerships with large losses are reported in compliance with the tax code. The campaign comes as sports deals continue to reach new heights and the volume of ..read more
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Taxing Digital Is Hard, Former State Tax Chief Says
Talking Tax
by Bloomberg Tax
1M ago
For more than a decade, states have had to grapple with the challenge of taxing the digital economy. Peering into cyberspace, tax administrators were often left with more questions than answers. What online products and services should be taxed? How does a state source a virtual creation to a specific jurisdiction? Can states even tax digital products and services in the face of federal limits on discriminatory taxes on electronic commerce? State tax authorities now have to answer these questions without Gil Brewer, who retired at the end of January from his position as assistant director of t ..read more
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Multinationals Shoot Ads With State Film Tax Credits
Talking Tax
by Bloomberg Tax
1M ago
State film tax credit programs are increasingly financing advertisements for some of the world’s largest consumer product companies, some of which subsequently sell the credits to other companies looking to reduce their state tax liabilities. Twenty-eight states and Puerto Rico allow such incentives for production of commercials. Major companies, including McDonald’s Corp., Kellanova, and AbbVie Inc., receive these to promote products such as burgers, cereal, and prescription drugs. Tax credits are sometimes obtained by ad agencies or production companies, while in other cases the brands obtai ..read more
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Here's What to Know as Tax Filing Season Kicks Off
Talking Tax
by Bloomberg Tax
1M ago
More than 146 million individual tax returns are expected to be filed before the end of the 2024 tax filing season. The IRS, with the help of the tens of billions of dollars in supplemental cash from the Democrats' 2022 tax-and-climate law, built up its call centers, expanded its online options, and is now offering more hours at its taxpayer assistance centers to help make a smoother tax filing season for taxpayers and tax professionals. It also launched a controversial free agency-run filing tool for low- and moderate-income taxpayers filing simple returns, though access to the tool won't be ..read more
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States Eye Worldwide Reporting to Curb Income Shifting
Talking Tax
by Bloomberg Tax
1M ago
For decades, states’ authorities to tax the earnings of multinational corporations have ended abruptly at the “water’s edge.” Frustration with this limitation, however, has grown in recent years as large, sophisticated businesses employ accounting techniques and asset transactions to shift their domestic earnings offshore. Mandatory worldwide combined reporting—an apportionment method requiring the calculation of taxes based on global income attributable to a particular jurisdiction—is one possible solution gaining attention in state capitals. Lawmakers in Minnesota came close to enacting a wo ..read more
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States Eye Worldwide Reporting to Curb Income Shifting
Talking Tax
by Bloomberg Tax
2M ago
For decades, states’ authorities to tax the earnings of multinational corporations have ended abruptly at the “water’s edge.” Frustration with this limitation, however, has grown in recent years as large, sophisticated businesses employ accounting techniques and asset transactions to shift their domestic earnings offshore. Mandatory worldwide combined reporting—an apportionment method requiring the calculation of taxes based on global income attributable to a particular jurisdiction—is one possible solution gaining attention in state capitals. Lawmakers in Minnesota came close to enacting a wo ..read more
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