Taxpayers, Taxing the Wealthy, and a Redesigned Tax Incentive

National Taxpayer Advocate lists three IRS challenges. The annual report, released yesterday by Acting National Taxpayer Advocate Bridget Roberts, highlights the need for implementation of the Taxpayer First Act, inadequate taxpayer service, and limited agency funding. The report also says it is important for Treasury to appoint a permanent National Taxpayer Advocate to “help ensure the IRS protects taxpayer rights and meets its obligations to taxpayers.”

A House vote on EITC expansion? Ways & Means Committee Chair Richard Neal told reporters yesterday that he’d like to see the House vote this year on a bill to expand the Earned Income Tax Credit and the Child Tax Credit. He said the White House was being “intransigent” on the issue. The bills have no support among Senate Republican leaders, although some rank-and-file GOP senators favor bigger refundable credits.  

Three issues need more attention when taxing the wealthy. TPC’s Gene Steuerle outlines them: How would changes address double taxation? How should  unrealized capital gains be taxed at death? When is the best time to tax wealth and/or returns from capital? Steuerle concludes that answering them “can help channel efforts to raise—or for that matter, lower—taxes on the wealthy more efficiently and equitably.

Could a redesigned tax deduction make more of us feel better about giving to charity? Tax Vox’s Tax Hound considers the merits of a universal deduction for charitable giving, available to taxpayers regardless of whether they itemize. 

US and France work toward a compromise over a digital tax. Companies threatened by higher tariffs on French imports such as wine, cheese, handbags, and cookware came to Washington last month to argue against the Trump Administration’s plan. French finance minister Bruno Le Maire has told Treasury Secretary Steven Mnuchin “that as long as we are discussing, as long as we are negotiating, there could not be any American sanctions.” US-based tech firms are strongly opposed to a unilateral French digital tax and supporting Trump’s tariff threat.

For the latest tax news, subscribe to the Tax Policy Center’s Daily Deduction. Sign up here to have it delivered to your inbox weekdays at 8:00 am (Mondays only when Congress is in recess). We welcome tips on new research or other news. Email Renu Zaretsky at [email protected].

https://www.taxpolicycenter.org/daily-deduction/taxpayers-taxing-wealthy-and-redesigned-tax-incentive