“That's the game.”
Today, Washington Post’s WonkBlog walks through how easy it is for companies to exploit the GOP tax law – further decreasing government revenue, exploding the deficit, and leaving middle-class families without tax lawyers behind. It’s more evidence that this bill was written to benefit the wealthy and special interests and not American workers. Here’s a look at the highlights:
“In the hopes of paying less in taxes, several surgical centers in Louisiana are considering spinning off their parking garages into separate businesses. Eye doctors in Florida are looking at separating their eyeglasses business from their medical practices. And small and middle-size law firms around the country are pondering treating their offices as distinct real estate companies.”
“Tax lawyers say they are working with these types of clients to find ways to remake their operations as a result of the massive tax overhaul passed in December by Congress.”
“The tax law was supposed to make the tax code simpler, lowering rates while trimming tax breaks. But doctors and lawyers, among other professionals, are finding it’s something different.”
“‘The doctors are going berserk. The lawyers are trying to figure out everything they can. Clients are calling right and left. It’s a planning frenzy,’ said Bill Elliott, a Dallas tax expert and former chair of the state bar of Texas.”
“And if companies are broadly able to get in on a tax break that wasn’t intended for them, it would mean an unexpected cut to government revenue that further expands the law’s impact on the ballooning federal government’s deficit. The law as written is projected by the Joint Committee on Taxation to raise the deficit by $1 trillion over the next decade.”
“The Internal Revenue Service still needs to issue regulations governing how the tax deduction will work, one of a slew of issues with the new law that regulators are rushing to resolve. The deduction is at the top of a list of 39 different unresolved tax problems for which the American Institute of CPAs, the nation’s leading association of accountants, has asked for ‘immediate guidance.’”
“‘You’re trying to convert ordinary income rates by putting it into another box and calling that box ‘real estate.’ It has all the potential in the world for abuse,’ said Elliott, the tax expert in Dallas.”
“But critics say the rules around the deduction make little sense, and that the new rules will be easily circumvented.”
“‘The 20 percent deduction is structurally crazy,’ said Steven Rosenthal, a tax expert at the Urban Institute, a think tank. ‘It lowers tax rates for activities conducted through pass-through businesses, with arbitrary distinctions that invite abuse, adding another cubbyhole for imaginative tax planners and aggressive taxpayers.’”
“Kramer didn’t deny the possibility that the IRS will soon come out and deny the new arrangement he has set up for his clients. But he’s not losing sleep over it.”
“‘It could happen, but then we’ll figure out something else instead,’ Kramer said. ‘That’s the game.’”
“Tax lawyers say they are working with these types of clients to find ways to remake their operations as a result of the massive tax overhaul passed in December by Congress.”
“The tax law was supposed to make the tax code simpler, lowering rates while trimming tax breaks. But doctors and lawyers, among other professionals, are finding it’s something different.”
“‘The doctors are going berserk. The lawyers are trying to figure out everything they can. Clients are calling right and left. It’s a planning frenzy,’ said Bill Elliott, a Dallas tax expert and former chair of the state bar of Texas.”
“And if companies are broadly able to get in on a tax break that wasn’t intended for them, it would mean an unexpected cut to government revenue that further expands the law’s impact on the ballooning federal government’s deficit. The law as written is projected by the Joint Committee on Taxation to raise the deficit by $1 trillion over the next decade.”
“The Internal Revenue Service still needs to issue regulations governing how the tax deduction will work, one of a slew of issues with the new law that regulators are rushing to resolve. The deduction is at the top of a list of 39 different unresolved tax problems for which the American Institute of CPAs, the nation’s leading association of accountants, has asked for ‘immediate guidance.’”
“‘You’re trying to convert ordinary income rates by putting it into another box and calling that box ‘real estate.’ It has all the potential in the world for abuse,’ said Elliott, the tax expert in Dallas.”
“But critics say the rules around the deduction make little sense, and that the new rules will be easily circumvented.”
“‘The 20 percent deduction is structurally crazy,’ said Steven Rosenthal, a tax expert at the Urban Institute, a think tank. ‘It lowers tax rates for activities conducted through pass-through businesses, with arbitrary distinctions that invite abuse, adding another cubbyhole for imaginative tax planners and aggressive taxpayers.’”
“Kramer didn’t deny the possibility that the IRS will soon come out and deny the new arrangement he has set up for his clients. But he’s not losing sleep over it.”
“‘It could happen, but then we’ll figure out something else instead,’ Kramer said. ‘That’s the game.’”