A few things you may have missed this weekend while anxiously awaiting the return of the greatest show on TV (non-Simpsons division).
As an update to a previous post, the Service’s use of I.R.C. § 280E to deny all the deductions of a California medicinal marijuana business has bankrupted the dispensary, and left the remainder of the industry totally paranoid.
The best discussion I’ve found to date of how the expiration of the Bush tax cuts for those earning above $250,000 would actually work using real numbers.
Rapper Beanie Sigle heads to jail for failing to pay tax returns, looks forward to collaborating with The Suger Hill Gang.
We’ve already touched on the opportunity to sell your business before the 3.8% tax on unearned income kicks in for 2013, but the Wall Street Journal’s got some helpful investment advice to consider when preparing for the rate increase.
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I hope you’ve got an appetite for partisan divide and political posturing, because if last week is any indication, we’re in for a steady diet of both over the next six months. Last Thursday, U.S. Senators couldn’t manage to advance either of the two competing plans — one presented by each party — that would provide tax relief for “small businesses.”
We discussed the Republican plan, which had previously and predictably passed the House in April, here. In summary, it would have provided a 20% deduction from taxable income for all business with fewer than 500 employees. It was shot down 73-24 by the Senate, however, with the chief complaint of those in opposition to the bill being the rather obvious fact that the proposal had very little to do with “small business,” since it would have benefited 99% of all U.S. businesses, including some with billion dollar revenues.
On the other side, Democrats failed to garner the 60 votes necessary to further their party’s bill, which is rather pathetic when considering that Democrats currently control the Senate by a 58-40 margin. The Democratic proposal would have offered a 10% tax credit for hiring or increasing wages while also extending 100% bonus depreciation through 2012 — we’re currently stuck at 50% — but it was killed when it received only 53 votes, short of the 60 needed to overcome procedural hurdles and advance.
Obviously, these Senate results aren’t a reflection of the merits of the underlying bills; rather, they speak to a much larger issue facing Congress over the next six months. Neither party will show any willingness to yield to the other’s proposals, lest they lose the confidence of their constituents in advance of the election or give away any leverage they may have — whether real or perceived — in determining the fate of the all-important Bush tax cuts. For the forseeable future, no matter whether the issue is tax law, health care, or US Weekly’s “Who Wore it Best?,” Republicans and Democrats will simply disagree for disagreements sake. And it’s the American public who stand to pay the consequences.
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