This is another example of a bad idea that it may be a mistake to give more attention, but…. You’re gonna make Pay Pal do income tax withholding to solve the problem of there being no employers to do it in the gig economy?
I have explained before how income tax withholding hides the true effect of the federal income tax. This bad idea will spread that effect, making it far more pervasive and more impossible to remedy.
On the heels of an online petition and suggestions there could be a do-over comes news that Saints fans have resorted to the courts to remedy their loss.
I conclude that Saints fans are having difficulty coping with their grief.
MY JANUARY NEWSLETTER HAS TIMELY AND USEFUL INFORMATION ON FILING YOUR 2018 INCOME TAX RETURN
I have been writing a lot about income tax here recently. It’s usually on my mind in January.
My January Tax Law Special Report delivers timely and useful information about filing your 2018 federal income tax return, including the major changes to Form 1040. It also revisits the perennial question of how long you should keep copies of your tax returns.
Check out my Report in the publications section of deconcinimcdonald.com. If you want me to add you to my list of snail mail recipients (yes, I still mail a paper newsletter to valued friends and clients every month), you can send me an email via the link on my home page.
I have seen some lame stuff on the internet, but this comes from actual media outlets ( TV stations in Louisiana), not just some crank.
An item on one station’s web site claims that an NFL rule “allows Commissioner Roger Goodell to reverse outcome of Saints-Rams game.”
I’m not going to bother parsing the rule they quote in the item. I read it. It doesn’t say what they claim it says.
Even lamer is an online petition that demands a rematch of that game. An item from another TV station in Louisiana, reporting on that petition, says, “The chances for a rematch are slim.” Well, yeah. A do-over because a ref missed a call? When has that ever happened?
NO, THE PARTIAL SHUT-DOWN OF THE FEDERAL GOVERNMENT DOES NOT MEAN THAT YOU WILL GET A REPRIEVE ON FILING YOUR 2018 TAX RETURN
I doubt that the partial shut-down of the federal government is going to materially affect tax season because I can't believe that it won’t be resolved before April rolls around, but in case you were wondering, the IRS has issued a statement on how the federal appropriations lapse is impacting IRS operations. Here’s the key sentence of that statement:
During this period, the IRS reminds taxpayers that the underlying tax laws remain in effect, and all taxpayers should continue to meet their tax obligations as normal. Individuals and businesses should keep filing their tax returns and making payments and deposits with the IRS, as they are required to do by law.
ANOTHER SIN TAX THAT DIDN’T WORK
The city of Philadelphia adopted a tax on sweetened beverages. The result, according to an analysis by professors at Minnesota, Northwestern, and Stanford Universities, has not been reduced consumption of sweetened beverages, or increased consumption of beverages that aren’t subject to the tax. No, the result has been that people are buying the same beverages in places where they aren’t subject to the tax.
Oh, and prices for the beverages subject to the tax increased 30-40%.
What surprising results. Not.
You can use IRS Free File to file your 2018 federal income tax return if your adjusted gross income in 2018 was $66,000 or less. According to the IRS, 70% of individual taxpayers are eligible.
The IRS says that its Free File service “provides free, brand-name tax software and fee electronic filing” to taxpayers who qualify.
If preparing a federal income tax return wasn’t so complicated, this service wouldn’t be necessary. But tax complexity isn’t the IRS’ fault. They have to work with what Congress gives them.
You can get more information at (where else?) irs.gov, which is also where you have to go to get the service.
HOW LONG SHOULD I KEEP COPIES OF MY TAX RETURNS, AND WHAT DO I DO IF I DIDN’T KEEP A COPY AND NOW I NEED ONE
On the subject of tax returns, the IRS recently released a “Tax Tip” (IRS Tax Tip 2018-90, June 12, 2018) that says the IRS “recommends that taxpayers keep a copy of tax returns for at least three years.” It also provides useful information on how to get a transcript of a tax return if you need one (for some purposes you can actually be required to provide a transcript rather than a copy of the return), and how to get a copy of your return if you don’t have one.
Beware, however: the IRS says keep those old returns for at least three years. There are situations where you may need copies of your returns, and other records, going back as long as seven years, or more.
JUST BECAUSE HIGH MARGINAL INCOME TAX RATES EXISTED SIXTY YEARS AGO DOESN’T MEAN THEY ARE A GOOD IDEA TODAY
A discussion at the Cato blog of the effect of higher marginal income tax rates, now being proposed by some in Congress, highlights an aspect of that discussion that has occurred to me before. The proponents of dramatically higher tax rates cite the fact that such rates existed in the past, without any apparent harm to the economy. That assumes, however, that the national, and indeed the world, economy, are essentially no different than they were in the 1930s, or even the 1950s.
In reality, of course, the national and world economies are dramatically different today than they were even in the 1970s, let alone the ‘50s or ‘30s, as the author of that Cato blog post points out.
And why do the proponents of higher income tax rates always seem to overlook the demonstrated fact that lowering the top marginal rate has historically resulted in higher, not lower, tax revenue?
BUSINESSES EXIST TO CREATE VALUE FOR THEIR OWNERS BY DELIVERING GOODS AND SERVICES
Instapundit makes the point that the officers and directors of a corporation have a fiduciary duty to the corporation’s shareholders, that is, they have a duty to act in the best interests of the shareholders. It’s a point that I have brought up before.
Businesses entities (which is what corporations are) exist to create value for their owners (i.e., the shareholders) by delivering goods and services. It’s that simple. They have no other purpose.
I’m not going to link directly to the item linked in that Instapundit post, because the item is, frankly, tripe. Publicly-owned corporations have no “political responsibility.” They have a legal responsibility to maximize return on investment to their shareholders. Corporate sensitivity to social concerns can be justified legally only if it results in a better return on investment to the shareholders.
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.