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Sunday Poll: How Will You File Your Taxes?

January 28, 2018 Featured, Sunday Poll, Taxes Comments Off on Sunday Poll: How Will You File Your Taxes?
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The federal government is reopened. at least temporarily, so the IRS will be anticipating your 2017 tax return. The tax season begins tomorrow:

Although the IRS will begin accepting both electronic and paper tax returns on January 29, 2018, paper tax returns will be processed later, in mid-February, as system updates continue. The IRS strongly encourages people to file their tax returns electronically for faster refunds

The filing deadline to submit 2017 tax returns is April 17, 2018.  That’s because April 15 falls on a Sunday in 2018. That would normally result in a move to the following Monday (April 16, 2018). However, Emancipation Day falls on Monday, April 16 this year. Since that’s a legal holiday in the District of Columbia, the tax filing deadline will be pushed ahead for all individual taxpayers to Tuesday, April 17, 2018. (Forbes)

In years past I’ve had to file extensions, now I file as soon as I get all our W-2s & 1099s. Today’s poll isn’t about when you’ll file — but how you’ll file. The options are numerous:

The answers above are presented in a random order. this poll will close at 8pm tonight.

— Steve Patterson

 

 

 

Opinion: Tax Bill Xmas Gift a Lump of Coal for Many

December 27, 2017 Featured, Taxes Comments Off on Opinion: Tax Bill Xmas Gift a Lump of Coal for Many

The recent non-scientific Sunday Poll asked about the Fair Tax Act of 2017. I made it the Xmas-eve poll topic because of the president characterizing it as a gift.

It’s a gift alright…for the wealthy. For the rest of us it appears like a gift…but within a decade it turns to coal.

In trying to justify the Republican tax bill, conservatives are quoting Bernie Sanders, of all people. The problem is that they’re taking the Vermont senator out of context.

In an interview last week, CNN’s Jake Tapper asked Sanders, “Next year, 91 percent of middle-income Americans will receive a tax cut. Isn’t that a good thing?”

“Yeah, it is a very good thing, and that’s why we should have made the tax breaks for the middle class permanent,” Bernie replied. “But what the Republicans did is make the tax breaks for corporations permanent, the tax cuts for the middle class temporary.”  (Conservatives take Bernie Sanders out of context to justify their tax bill | Salon)

Yes, those cuts designed to thrill Trump’s base are minor and temporary. He’ll be out of office before they realize what happened..if they realize it even then.

The Tax Cuts and Jobs Act of 2017 has nothing to do with economics. It is pure politics. Economists struggling to understand the unwieldy legislation are like biochemists attempting to explain contemporary ballet. Nobody seriously believes that the bill will boost growth. Everybody knows that it will massively increase the deficit; the only argument is whether it will be by $1.5 trillion, or just $1 trillion. The legislation has been drafted at breakneck pace, with few opportunities for costings or analysis: a recipe for errors. Senator Elizabeth Warren joked that she spent more time choosing her new refrigerator than the Senate managed for tax reform.  (The new tax plan is the worst Christmas present for the middle class | Brookings)

Me in front of the White House, October 2001. I wore a watch and on my belt a case for a point & shoot camera!

But it’ll help the middle class…

There are elements of the bill that help middle-class Americans. It nearly doubles the standard deduction—the amount taxpayers can deduct from the annual income figure on which they’re taxed—to $24,000 for families and $12,000 for individuals. At the behest of Sen. Marco Rubio (R-FL), the final version of the bill hikes the child tax credit, allowing parents to subtract $2,000 per child from your tax bill. (Both changes are temporary, set to expire along with the individual tax cuts in 2025.)

But ultimately this is a bill for businesses and the people who own them. “The most important part of this tax reform is the corporate tax reform,” says Dr. Wayne Winegarden, an economist with the Pacific Research Institute, a free-market think tank. “How each individual is going to fare will depend on their unique circumstances.”

Many small businesses in the United States known as “pass-through” companies—after the way income “passes through” to their owners—are currently taxed as individuals. The tax bill will grant these businesses a 20% deduction. But the jury is out on whether the windfall for businesses will contribute to significant economic growth as Republicans claim, or whether corporations will pump their profits into hiring more employees.

In other words, the new bill will be a test of trickle-down economics, the Reagan-era economic policy that many experts now consider a flawed theory. Even some Reaganites are unimpressed by the legislation.
(The GOP Tax Bill Isn’t for the Middle Class. And It Was Never Meant to Be | Time)

Many know trickle-down doesn’t work…just look at Kansas for a recent example:

For five years, Kansas’s Republican governor, Sam Brownback, conducted the nation’s most radical exercise in trickle-down economics — a “real-live experiment,” he called it. He and the GOP-controlled legislature slashed the state’s already-low tax rates, eliminated state income tax for most owner-operated businesses and sharply reduced vital government services. These measures were supposed to deliver “a shot of adrenaline into the heart of the Kansas economy,” Brownback said.

It ended up being a shot of poison. Growth rates lagged behind those in neighboring states and the nation as a whole. Deficits mounted to unsustainable levels. Services withered. Brownback had set in motion a vicious cycle, not a virtuous one. 

Last week, finally, the legislature — still controlled by Republicans — overrode Brownback’s veto of legislation restoring taxation to sane levels. The nightmare experiment is coming to an end.
(Trickle-down economics is a nightmare. Kansas proved it. | The Washington Post)

The poll results:

Q: Agree or disagree: the massive federal tax cuts “will be an incredible Christmas gift for hard-working Americans.”

  • Strongly agree 4 [12.9%]
  • Agree 2 [6.45%]
  • Somewhat agree 2 [6.45%]
  • Neither agree or disagree 2 [6.45%]
  • Somewhat disagree 1 [3.23%]
  • Disagree 3 [9.68%]
  • Strongly disagree 16 [51.61%]
  • Unsure/No Answer 1 [3.23%]

This tax code change will be a disaster for those of us not in the top income brackets.

— Steve Patterson

 

Sunday Poll: Tax Cuts Bill a Great Xmas Gift for the Middle Class?

December 24, 2017 Featured, Taxes Comments Off on Sunday Poll: Tax Cuts Bill a Great Xmas Gift for the Middle Class?
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On Friday President Trump signed a bill making major changes to our tax code.

The bill reduces the corporate tax rate to 21 percent from 35 percent and supporters argue that will make U.S. business more competitive overseas. Many pass-through businesses also receive a 20 percent deduction. 

It lowers individual tax rates, including trimming the top bracket to 37 percent from 39.6, while doubling the standard deduction and replacing personal exemptions with a $2,000 partly refundable child tax credit. The law eliminates various deductions while limiting others on state and local taxes and mortgage interest. (NBC News)

Earlier last week Trump had this to say about the bill:

“They’re going to start seeing the results in February. This bill means more take-home pay. It will be an incredible Christmas gift for hard-working Americans. I said I wanted to have it done before Christmas. We got it done,” Trump said. (ABC News)

With Christmas tomorrow I thought I’d ask readers their view of the bill.

This non-scientific poll will close at 8pm.

— Steve Patterson

 

Sunday Poll: Should St. Louis County Personal Property Taxes Be The Same Regardless of Location?

November 26, 2017 Featured, St. Louis County, Sunday Poll, Taxes Comments Off on Sunday Poll: Should St. Louis County Personal Property Taxes Be The Same Regardless of Location?
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We recently received our personal property tax bill in the mail for our 2007 Honda Civic EX, but I know anyone else with the same car registered in the City of St. Louis will owe the same amount. St.Louis County, however, is very different. Yesterday the Post-Dispatch did a story on the variation in rates, citing two women at the start:

Each owns a 2014 Cadillac XTS. And each got her personal property tax bill in the mail from the county this month.

Johnson’s tax bill was $895. O’Neal’s was $436.

Across the St. Louis area, people are writing checks to pay their personal property taxes, which are due by year’s end. Residents of St. Louis all pay the same rate. But St. Louis County residents are not assessed evenly — far from it.

All county residents pay the same real estate and personal property tax rates for certain services, such as county government and community colleges. But the rates for public schools, fire protection and municipalities vary dramatically. The boundaries don’t overlap cleanly, so even next-door neighbors can pay different rates. (Post-Dispatch)

According to the Post-Dispatch it is lower income areas that are paying the most.

The above is the subject of today’s poll:

This poll will close at 8pm tonight, I’ll post my thoughts on Wednesday.

— Steve Patterson

 

Judge: Special Business District Did Not Comply With State Law, Board Members Failed To Disclose Conflicts of Interest

July 3, 2017 Featured, Politics/Policy, Taxes Comments Off on Judge: Special Business District Did Not Comply With State Law, Board Members Failed To Disclose Conflicts of Interest
In 2013 The Locust Business District completed a fenced surface parking lot on Olive.

In January 2016 the Locust Business District was sued by a property owner within the district. Last month the property owner, Bob Wood, was victorious. Yes, for 18 months he’s tried to improve transparency of just one of the city’s many special districts. From March:

But for more than a year, Bob Wood has been battling in court with the Locust Business District, which collects a special property tax estimated to bring in about $325,000 this year to fund security and events in an area stretching from Downtown West to Midtown.

Wood, the owner of the Majestic Stove and Adler Lofts in the district, took his case to trial in St. Louis Circuit Court this week, where his attorney, Elkin Kistner, grilled Locust Business District board members about meeting minutes, budgeting and the tedium of administering a taxing district.

Wood said he was looking for Judge Joan Moriarty to say that some of the district’s management and budgeting practices were illegal. A ruling in the case is expected in about two months. (Post-Dispatch)

I’ve been following the case since it was filed. The ruling was in Wood’s favor:

Budget practices at the Locust Business District did not comply with Missouri law, board members failed to disclose conflicts of interest and the district made unlawful donations of tax money, a St. Louis judge ruled Tuesday.

The ruling by St. Louis Circuit Court Judge Joan Moriarty caps over a year of litigation against the special taxing district, which uses property taxes to pay for security, marketing and events in an area stretching from Downtown West to midtown. (Post-Dispatch)

Judge Moriarity’s 16-page ruling doesn’t mince words, for example:

The District routinely spends money without Board approval. Its Rules, Policies and Procedures explicitly authorize expenditures by the Chairman of the Board of up tp $2,500 without board approval.

The Board frequently considers matters presented to it by Commissions who have personal, financial interests in those matters. Such matters present conflicts of interest. Commissioners who are so conflicted do not make written disclosures of the nature of those conflicts, nor do they always refrain from participating in Board discussions of, and votes on, such matters. (See ruling

By some estimates there are at least 100 such districts in the greater St. Louis region, there are probably at least a few more like this. Don’t expect your elected official to make sure this doesn’t happen — it can benefit them greatly.

— Steve Patterson

 

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