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Former exec gets 6 months in prison over unpaid taxes - Omaha World-Herald

Google IRS Federal Income Tax - Wed, 2014-08-20 00:37

Former exec gets 6 months in prison over unpaid taxes
Omaha World-Herald
The former chief executive of an Omaha company has been sentenced to six months in prison for failing to pay the IRS federal income taxes that had been withheld from his employees' paychecks, according to the U.S. Attorney's Office in Omaha. U.S ...
Omaha Man Sentenced in Tax CaseWOWT

all 10 news articles »
Categories: Tax news

Prison inmates charged with tax fraud; collected $400K in tax refunds - Rick Kupchella's BringMeTheNews

Google IRS Federal Income Tax - Tue, 2014-08-19 21:27

CBS Local

Prison inmates charged with tax fraud; collected $400K in tax refunds
Rick Kupchella's BringMeTheNews
Two inmates at the Minnesota state prison in Faribault have been charged with filing false tax claims to the Internal Revenue Service and collecting $400,000 in fraudulent tax refunds while they were incarcerated, WCCO reports. The U.S. Attorney's ...
Two Minnesota men accused of committing tax fraud while in prisonTwinCities.com-Pioneer Press

all 16 news articles »
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Florida man, 83, admits hiding $1.1M from IRS - USA TODAY

Google IRS Federal Income Tax - Tue, 2014-08-19 15:52

USA TODAY

Florida man, 83, admits hiding $1.1M from IRS
USA TODAY
Kramer initially maintained the secret Swiss account after it became publicly known in 2008 that Swiss banking giant UBS was being investigated by U.S. authorities for allegedly helping American account owners evade federal taxes. The following year ...
Florida Man, 83, Admits To Hiding $1.1M From IRSWFMY News 2
Florida Man's IRS Shell Game Involved Hidden $1M, False ReturnsNewsmax.com
Man pleads guilty over 'Hot Lips' account used to evade US taxesReuters

all 18 news articles »
Categories: Tax news

Tax-Exempt Nonprofits Owe Millions in Payroll Taxes - ThinkAdvisor

Google IRS Federal Income Tax - Tue, 2014-08-19 09:14

ThinkAdvisor

Tax-Exempt Nonprofits Owe Millions in Payroll Taxes
ThinkAdvisor
... IRS doesn't appear too eager to go after them, according to a recent report. Tax-exempt organizations are generally not required to pay income taxes, but they are required to pay other taxes, such as payroll taxes. ... “Tax-exempt organizations ...

Categories: Tax news

Former Crestwood school board member pleads guilty to tax fraud - Dearborn Press and Guide

Google IRS Federal Income Tax - Mon, 2014-08-18 22:24

Former Crestwood school board member pleads guilty to tax fraud
Dearborn Press and Guide
By failing to report the embezzlement income, Golani reduced her tax liability by $77,072. Overall, Golani failed to report the embezzled funds on her 2006, 2007, 2008 and 2009 federal income tax returns causing a tax loss of more than $225,000 ...

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Federal appeals court upholds conviction of man tied to sovereign movement - Dothan Eagle

Google IRS Federal Income Tax - Mon, 2014-08-18 14:54

Federal appeals court upholds conviction of man tied to sovereign movement
Dothan Eagle
... Turner was convicted in March of 2013 of conspiracy to defraud the United States, attempting to pay taxes with fictitious financial instruments, attempting to obstruct and impede the Internal Revenue Service, failing to file a 2009 federal income ...

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Categories: Tax news

Alaska Voters to Decide Oil Production Tax Changes

Tax Foundation - Mon, 2014-08-18 13:45

Alaska voters go to the polls tomorrow to decide Measure 1, which would change taxation of oil production. A yes vote repeals the More Alaska Production Act (MAPA) tax system championed by Gov. Sean Parnell (R) and passed in 2013, instead reinstating the previous Alaska’s Clear and Equitable Share (ACES) tax system pushed through in 2007 by then-Gov. Sarah Palin (R) in 2007. A no vote keeps the MAPA tax system.

Alaska has imposed a severance tax on oil production ever since sizeable extraction began in the late 1970s, which enabled Alaska to be the only state to repeal its state income tax. Over time, Alaska has collected $191 billion in oil production taxes, including tens of billions set aside in the Permanent Fund, with some of that paid to Alaska residents annually as dividends. Historically, the tax was structured as an Economic Limit Factor (ELF), which adjusted tax deductions to result in high taxes on highly productive oil fields and low taxes as a field’s profitability drew down.

Alaska oil production peaked in 1988 at about 2 million barrels a day and has declined since, to about 500,000 barrels a day today. With production declining and oil prices soaring, Alaska in 2006 adopted the Petroleum Profits Tax (PPT), which doubled taxes by consolidating tax calculations for various fields into regions and taxing the value of the oil and gas produced, with a higher tax when profits exceeded $40 per barrel. Continued soaring oil prices led to the enactment of the ACES system in 2007, which doubled taxes again by disallowing a number of production cost deductions, increasing the base tax rate to 25 percent, and taxing profits more heavily when they exceed $30 per barrel. These taxes are in addition to state and federal corporate income taxes.

Production has continued to decline under ACES, while production in Texas, Oklahoma, New Mexico, North Dakota, and Canada have grown sharply. Dividend checks mailed to each Alaskan fell from over $2,000 in 2008 to $900 last year, and the Trans-Alaska Pipeline is running dry. Governor Parnell blames the high taxes and pushed through SB 21 in 2013 to enact the MAPA system, which imposes a higher base tax rate of 35 percent but eliminates progressive add-ons. Parnell said the system is needed to encourage greater production, but opponents say it will sharply reduce oil tax revenue.

Polls show Alaskans almost evenly split on the measure, and signs and ads for both sides are everywhere in the state. It’s an important topic for the state because oil wealth has fueled much of the economic progress and state services for the last several decades. Unemployment in the state has crept above the national average for the first time in a long time, and anxiety is growing as production declines and other states surpass Alaska’s oil production. Both sides emphasize the importance of the oil industry to the state’s economic progress, debating whether taxing it very heavily is the right approach. Each voter may well be thinking the future of the state is in their hands with this vote.

Categories: Tax news

The Real Value of $100 in Each State

Tax Foundation - Mon, 2014-08-18 09:00

This week’s tax map shows the real value of $100 in each state. Because average prices for similar goods are much higher in California or New York than in Mississippi or South Dakota, the same amount of dollars will buy you comparatively less in the high-price states, or comparatively more in low-price states. Using data from the Bureau of Economic Analysis that we’ve written about previously, we adjust the value of $100 to reflect how prices are different in each state.

For example, Tennessee is a low-price state, where $100 will buy what would cost $110.25 in another state that is closer to the national average. You can think of this as meaning that Tennesseans are about ten percent richer than their nominal incomes suggest.

The states where $100 is worth the least are the District of Columbia ($84.60), Hawaii ($85.32), New York ($86.66), New Jersey ($87.64), and California ($88.57). That same money goes the furthest in Mississippi ($115.74), Arkansas ($114.16), Missouri ($113.51), Alabama (113.51), and South Dakota ($113.38).

Regional price differences are strikingly large, and have serious policy implications. The same amount of dollars are worth almost 40 percent more in Mississippi than in DC, and the differences become even larger if metro area prices are considered instead of statewide averages. A person who makes $40,000 a year after tax in Kentucky would need to have after-tax earnings of $53,000 in Washington, DC just in order to have an equal standard of living, let alone feel richer.

As it happens, states with high incomes tend to have high price levels. This is hardly surprising, as both high incomes and high prices can correlate with high levels of economic activity. However, this relationship isn’t strictly linear: for example, some states, like North Dakota, have high incomes without high prices. Adjusting for prices can substantially change our perceptions of which states are truly poor or rich.

As we showed in an example in our recent paper on income data, adjusting for prices reveals average real incomes in Kansas to be higher than in New York, despite New York having much higher incomes as measured in dollars.

The tax policy consequences of this data are significant. For example, because taxes must be calculated based on nominal income, the average New York resident pays significantly more in taxes than the average Kansas resident. But the Kansas resident actually has higher purchasing power, meaning that they get to pay lower taxes despite getting to have a richer amount of consumption.

Furthermore, this affects means-tested federal welfare programs. A poor person in a high cost area – like Brooklyn or Queens - may be artificially boosted out of the range of income where they are eligible for welfare programs, despite still being very poor. At the same time, many people in low-price states may be eligible for welfare programs despite actually being much richer than they appear. If the same dollar value program is offered in New York City and rural South Dakota, it may be too small to help anyone in New York City, and yet so big it discourages work in South Dakota.

We’ve explained elsewhere how taxes have a role to play in urban gentrification, which in turn increases the cost of living and the local price level. As we also pointed out when the BEA data was first released, adjusting state incomes for price levels helps solve several statistical problems related to taxes and migration as well.

Follow Alan and Lyman on Twitter.

Categories: Tax news

The Impact of Low Income College Students on Inequality

Tax Foundation - Mon, 2014-08-18 08:00

College is generally a good investment. On average, people who earn a four year degree go on to make almost twice as much as those with only a high school diploma. But while those future high earners are in college, they tend to be relatively poor (speaking from experience here).

The relative poverty of college students has some big implications for how we look at inequality. We recently released a new report that takes a new look at the use of household income data and it’s implications for inequality.

Incomes are Low in College Towns

College towns are often home to the lowest-income places in the United States (table below).

The Fifteen Lowest-Income Places in the United States

Census Place

Number of Households

Median Household Income (2012 Dollars)

Mean Household  Income (2012 Dollars)

Higher Education

Boone, North Carolina

6221

$16,447

$33,173

Appalachian State University

Carbondale, Illinois

9601

17743

36495

Southern Illinois University

Athens, Ohio

6497

18428

41163

Ohio University

East St. Louis, Illinois

10612

19278

27732

 

Statesboro, Georgia

9850

20751

32586

Georgia Southern University

Opa-locka, Florida

5163

20757

30512

 

East Cleveland, Ohio

8074

20797

29280

 

Opelousas, Louisiana

6110

20983

33058

 

University CDP (Hillsborough County), Florida

16657

20992

28893

University of South Florida

Selma, Alabama

7812

22076

40092

 

Milledgeville, Georgia

5839

23580

39824

Central Georgia Technical College, Georgia College, Georgia Military College

Prichard, Alabama

8714

23726

32582

 

State College, Pennsylvania

12178

24104

45138

Pennsylvania State University

Pullman, Washington

10151

24125

47808

Washington State University

Oxford, Ohio

5730

24211

49458

Miami University

Source: U.S. Census Bureau, American Community Survey (Selected Economic Characteristics, 5-year Estimates).

Note: minimum 5,000 households.

According to U.S. Census Bureau data, Hillsborough County, Florida (the home of the University of South Florida) has a median income of just over $20,000 a year. It would be very easy for the common observer to assume that the residents of Hillsborough County have a relatively low quality of life, when in fact they have a bright future. 

One example: If you observed the tax data for surgeons, you would find very high degrees of inequality. Through their twenties, surgeons are in medical school and earning very little. Whereas, in their prime, with a proven track record and solid experience, they can earn $400,000 or more.

Economists and social scientists often consider low incomes as a sign of a lack of opportunity. Although that is sometimes very true, the opportunity costs of the situation must also be taken into account. Economist Alan Cole writes:

“A reasonable person would not say a construction worker is clearly better off than a business school student. And yet, it is the latter who benefits from progressive income taxes and refundable tax credits at the expense of the former. Use data unreasonably and you will get unreasonable results.”

The Growth in College Enrollment

Not only do post-secondary students predictably skew overall income data, they do it at an accelerating rate. Over 20 million students are currently enrolled in post-secondary education.

Since the late 1970s, we have seen post-secondary enrollment nearly double, from just over 10 million students to over 20 million students today.

This growth in post-secondary enrollment must certainly be considered in any discussion of changes in inequality.

To read the full report: click here

Categories: Tax news

Rapper Beanie Sigel moved from prison to halfway house - Philly.com

Google IRS Federal Income Tax - Mon, 2014-08-18 06:40

Philly.com

Rapper Beanie Sigel moved from prison to halfway house
Philly.com
Rapper Beanie Sigel has moved from a federal prison to a halfway house. The Bureau of Prisons says Sigel, whose real name is Dwight Grant, was moved from the Federal Correctional Institution Schuylkill to a Philadelphia-area residential reentry center ...

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Categories: Tax news

When companies flee US tax, investors don't gain - CNBC

Google IRS Federal Income Tax - Mon, 2014-08-18 01:20

CNBC

When companies flee US tax, investors don't gain
CNBC
Establishing a tax domicile abroad to avoid U.S. taxes is a hot strategy in corporate America, but many companies that have done such "inversion" deals have failed to produce above-average returns for investors, a Reuters analysis has found. Looking ...
INSIGHT - When companies flee US tax system, investors often don't reap big ...euronews
No major gain by avoiding US taxThe Rakyat Post

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Categories: Tax news

Corporate foreign tax moves have bedeviled U.S. for decades

Yahoo Tax - Sun, 2014-08-17 22:12
By Kevin Drawbaugh WASHINGTON (Reuters) - The U.S. government has grappled for more than 30 years with corporate deals known as inversions in which U.S. companies shift their tax domiciles abroad to avoid U.S. taxes. ISLAND TIME The first inversion in 1983 was followed a year later by two new rules from the U.S. Internal Revenue Service. Inversions allowed U.S. companies to book foreign profits at low or no taxes abroad, putting them out of the reach of the U.S. Internal Revenue Service.
Categories: Tax news

Are 'Expendables 3' & IRS Equally Expendable? - Forbes

Google IRS Federal Income Tax - Sun, 2014-08-17 07:26

Forbes

Are 'Expendables 3' & IRS Equally Expendable?
Forbes
The bills introducing this, H.R. 25 and S. 122, call for abolishing all federal personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes. The new federal retail sales ...
Save our economy by abolishing the IRS, making taxation voluntaryDaily Herald

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Categories: Tax news

Growing recognition of 'real estate' cuts firms' tax bills - Boston Globe

Google IRS Federal Income Tax - Sat, 2014-08-16 21:23

Boston Globe

Growing recognition of 'real estate' cuts firms' tax bills
Boston Globe
Under federal law, REITs are required to distribute 90 percent of their profits to stockholders, which helps them reduce or eliminate their tax liability. ... With the surge in real estate trusts costing the US government billions in lost tax payments ...

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Save our economy by abolishing the IRS, making taxation voluntary - Daily Herald

Google IRS Federal Income Tax - Fri, 2014-08-15 21:06

Save our economy by abolishing the IRS, making taxation voluntary
Daily Herald
The following plan will create millions of jobs for the unemployed. Everyone will pay their fair share of federal taxes (including the 47 percent that now pay no federal income tax) with a break for the poor and the unemployed. The rich will pay more ...

Categories: Tax news

Viewtran: About To View Large Tax Bill? (VIEW) - Seeking Alpha (registration)

Google IRS Federal Income Tax - Fri, 2014-08-15 11:55

Viewtran: About To View Large Tax Bill? (VIEW)
Seeking Alpha (registration)
Viewtran appears to have generated a large U.S. federal income tax liability of which it is unaware, based on my analysis of VIEW's SEC filings. I estimate this liability to be very approximately 17% of market capitalization, and 3% of total ...

Categories: Tax news

IRS to probe Valeant tax returns after Canada deal - Financial Times

Google IRS Federal Income Tax - Fri, 2014-08-15 10:52

IRS to probe Valeant tax returns after Canada deal
Financial Times
Before the 2010 merger, Valeant profits were largely subject to the US federal income tax rate of 35 per cent. Biovail, by comparison, reported an effective tax rate as low as 7 per cent. For the last three years Valeant has paid an effective tax rate ...

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Categories: Tax news

How Obamacare could make filing taxes a nightmare - Vox

Google IRS Federal Income Tax - Fri, 2014-08-15 08:38

How Obamacare could make filing taxes a nightmare
Vox
Individuals and families who bought subsidized coverage have been receiving tax credits based on whatever amount they thought they would earn this year. Upon filing taxes, the IRS will reconcile the amount of subsidy received, based on expected income, ...

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Allentown residents admit to $700000 IRS scam - Allentown Morning Call

Google IRS Federal Income Tax - Thu, 2014-08-14 18:40

Allentown residents admit to $700000 IRS scam
Allentown Morning Call
Three members of an Allentown group accused in an identity theft scam to steal more than $700,000 from the Internal Revenue Service appeared in federal court this week and two were sentenced to prison terms. Jose Peralta and Fayez Antonios were each ...

Categories: Tax news

Ad Watch: Pennsylvania governor's race - Capitol Ideas with John L. Micek (blog)

Google IRS Federal Income Tax - Thu, 2014-08-14 18:33

Ad Watch: Pennsylvania governor's race
Capitol Ideas with John L. Micek (blog)
But in interviews, Corbett campaign spokesman Chris Pack said the ad refers to 2010, the last year the Congressional Budget Office published national tax data in its "Distribution of Household Income and Federal Taxes, 2010" report. The ad, however ...

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