To reach the status of one of the dumber tax ideas I have heard recently, the idea must be pretty dumb, but I think this one qualifies: take a sales tax that was enacted to protect an urban area’s water supply and divert it to pay for public transit instead. Huh?
If the tax is needed to protect the water supply, how could it possibly make any sense to divert it to pay for public transit?
On the other hand, if the objective for which the tax was levied has been accomplished, then how about repealing it? Why don’t politicians ever think of that?
In my latest Estate Planning Law Report, I discuss the new law that makes it possible to have an enforceable electronic will. I also make the case that although that law is now in place, it may be a while before you can actually take advantage of it. And I caution that the new law does not mean that an electronic copy of your existing will can now replace the physical, paper, original document.
Please read all about it in the news and events section of deconcinimcdonald.com and let me know what you think.
IRS: We’ll get your income tax liability figured correctly with no help from you. Trust us.
Me: Really? Thanks for the offer, but I think I have some information you don’t, and I’m just as likely to get it right as you are.
When I wrote yesterday about the senator who won’t give up on taxation of unrealized gains, I gave him a little too much credit when I said that he apparently figured out that it wouldn’t work on some types of assets (he calls them "nontradeable" assets). No, he’s come up with a Rube Goldberg type contrivance to penalize you for deferring the realization of gains on your "nontradeable" assets. By deferring the gains, what he means is, you didn’t sell the assets. He’s going to fix that (you) by going back and treating the gain as if it was realized in each year that you held the asset, apparently. He still doesn’t really explain how this is going to work.
Here’s the senator’s description of this latest brilliant idea:
Tax due on gain realized from non-tradeable property such as real estate, business interests or collectibles will be calculated at sale or transfer through a lookback charge. The lookback charge would tax accrued gain and minimize the benefit of deferring tax. Senator ***** is evaluating several possible methods of calculating a lookback charge, including an interest charge on deferred tax, a yield-based tax to eliminate the benefits of deferral or a surtax based on an asset’s holding period.
No, I’m not going to link to it. if you really want to read the whole thing, it’s not hard to find.
I have written about this before, and predicted that a U.S. Senator’s proposal for taxing unrealized gains (that’s what “mark-to-market” means) would never be adequately explained. After reading about his latest pronouncement on the subject, I still think that’s the case.
I’m not sure how his new proposal is all that different from the last one. The new proposal does at least concede that taxing unrealized gains on certain kinds of assets is just not going to work, hence the limitation of the proposed tax to “tradeable assets” (whatever that means).
A court said that in denying a homeowner’s request to seal the records of the homeowner’s lawsuit against his insurance company. The homeowner sued the insurance company to force them to pay for water damage to his home. The homeowner claimed that despite the fact that he had completely fixed the water damage, no one would buy his house, nor would any broker even list it for sale.
Where are this university president’s lawyers when they should be telling him that the state can’t ban fliers and flags because the content of those filers and flags is offensive?
Really, it’s not that complicated. If you need an easy to remember example, just think of the one I always go back to: Nazis in Skokie.
DO YOU REALLY WANT TO MAKE YOUR CHILDRENS’ AND GRANDCHILDRENS’ INHERITANCE CONDITIONAL ON THEM DOING THINGS YOUR WAY?
In thirty years as a lawyer, I have had very few estate planning clients suggest conditioning gifts to their progeny on the kinds of restriction described in a recent Wall Street Journal article, excerpted and linked at the Taxprof Blog. I can’t recall a client ever even suggesting that a gift should be conditioned on marrying within the family’s faith tradition, for example. I agree that those kinds of conditions can have detrimental unintended effects.
When a client suggests that gifts should be conditioned on specific future events or activities, I typically simply point out that it’s impossible to predict the future, and equally impossible to even know what circumstances might exist at the future time when those conditions will have to be applied. Usually, the client will agree that they don’t want to put the person who would have to enforce those conditions in what might be an untenable position.
My motto is: keep it simple.
The contents of this blog, this web site, and any writings by me that are linked here, are all my personal commentary. None of it is intended to be legal advice for your situation.