As a guy who’s remote rarely stops on anything but sports, cartoons, or Breaking Bad, I’ve never been able to independently verify the notion that certain news networks have conservative, Republican agendas while others relentlessly throw their support behind the liberal left. But after seeing this chart shown on Fox News, I’m starting to think there may be something to it.
Yeah, that’s a tad misleading. In case you can’t make out the details, the cart is comparing the current top tax rate of 35% with the top rate of 39.6% that we’re heading towards on January 1, 2013 if the Bush tax cuts expire. Despite the fact that there’s a 4.6% difference between the two, the chart certainly appears to indicate that the rate is set to quadruple at the end of the year which can only mean TAXMAGEDDON IS COMING!! Funny that Fox News chose the 34-42% range on the right to accentuate the tax increase.
In other news, the Tax Court again shot down a taxpayer’s drag racing activity as a hobby, disallowing the large losses deducted on Schedule C.
Chris Johnson earned serious coin as a full-time engineer, but when he wasn’t engennerin’, he liked racing cars. Between 2003 and 2005 his drag racing activity produced losses well in excess of $150,000, which sheltered a substantial portion of the ordinary income generated by his full-time job.
Johnson’s lack of a business plan or separate bank account and failure to obtain sponsors or consult with experts were strong indications that the racing activity was not a for-profit business. Coupled with the recreational aspects of racing and the large history of losses that were offsetting otherwise taxable income, the Tax Court found that Johnson ran afoul of eight of the nine “hobby loss factors.”