tax gap - The S Corporation Association

Budget Targets Tax Gap

It is time to start a tally of how many times Congress spends revenues raised from closing the tax gap.

It’s an annual tradition. Each year, Congress picks out its favorite revenue raiser and then uses that revenue over and over again to pay for new spending or tax relief. Past contenders include overturning the Schmidt Baking decision, codification of the IRS’s economic substance test, SILOs, LILOs, COLI, etc. For 2007, the tax gap is the leading contender, and it’s already being used up.

As CongressDaily reported last week, the budget includes more than twenty “reserve funds” that allow for additional spending …

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admin2019-02-06T18:46:05+00:00March 20, 2007|

Energy Tax Bill and Energy Offsets

For those small business groups who are thinking that Big Oil will foot the bill for any energy tax title enacted this year, a new CRS report issued Tuesday provides little comfort.

The report, entitled “Oil and Gas Subsidies: Current Status and Analysis,” summarizes the current state of tax provisions targeted directly at the oil and gas industries. What they found is those tax “subsidies” are not as valuable as many people have assumed. As the report concludes:

“Although the above oil and gas tax subsidies may not be justified …

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admin2019-02-06T18:46:05+00:00March 2, 2007|

Is Official Washington Targeting S Corporations? Sure Looks That Way

As our readers know, the IRS is currently targeting S corporations, and only S corporations, for audits as part of its on-going “Tax Gap” research project. And the Joint Committee on Taxation and Treasury Inspector General for Tax Administration have, over the past couple year, proposed to dramatically increase the application of payroll taxes on S corporation income.

Now the Congressional Budget Office issues its new biannual “Budget Options” report, and there, on page 297 is an option entitled, “Repeal Tax-Free …

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admin2019-02-06T18:46:06+00:00February 26, 2007|

House Passes Small Business Tax Package — What’s the Next Step?

Real quick, the House just passed its small business tax package (H.R. 976) to accompany the proposed minimum wage increase, 360-45. This action follows a very bipartisan markup last Monday, where the tone of the hearing was a dramatic departure from what we’ve come to expect from Ways and Means meetings. That this comity occurred over a $1 billion package that included no S corporation provisions was a little disconcerting, but it is something we will have to work on.

So what’s the next step? The Senate could take up the House-passed …

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admin2019-02-06T18:46:06+00:00February 16, 2007|

Rangel Ready to Prepare Small Business Tax

Good news for S corporations and other closely-held businesses! Ways and Means Chairman Charles Rangel (D-NY) indicated yesterday that he plans to put together a package of small business provisions to be coupled with the minimum wage increase that has already passed both the House and the Senate. This announcement reverses the previous position of the House leadership, who had indicated they wanted to send the President a “clean” minimum wage bill. As BNA reports:

House Ways and Means Committee Chairman Charles Rangel (D-N.Y.) said Feb. 6 that the House would put together …

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admin2019-02-06T18:46:06+00:00February 7, 2007|