Talking Tax

The clock is ticking on Gov. Kathy Hochul (D) to take action on legislation that would make New York the first state to publicly list the owners behind limited liability companies. The bill, A3484A, would require LLCs to disclose their beneficial owners and other identifying information, such as their business street address. Those who fail to comply for more than two years would be shown as “delinquent” on state records and subject to a $250 penalty. Entities with “significant privacy interests” could apply for a waiver to not appear in the state registry. On this episode of Talking Tax, Bloomberg Tax spoke with state Sen. Brad Hoylman-Sigal, the Manhattan Democrat who sponsored the bill, and Chelsea Lemon, director of government affairs for the Business Council of New York, which opposes the legislation. "The LLC Transparency Act doesn't minimize or alter the legal structure or protections of LLCs, but it provides necessary transparency for the public's benefit, as well as our law enforcement," Hoylman-Siga

It isn't every day that a dispute over a $14,729 tax bill gets every corner of the tax world paying attention—but the potential ramifications of the dispute now before the Supreme Court go far beyond that. The court will hear oral arguments next month in Moore v. United States, in which Charles and Kathleen Moore, a retired couple from Washington state, are arguing that the “mandatory repatriation tax” should be declared unconstitutional. That tax, enacted as part of the 2017 tax-overhaul law, imposed a one-time levy on accumulated foreign corporate profits when the US changed its tax system so as to tax foreign profits going forward. It also led to the Moores’ $14,729 tax bill, which they had to pay on earnings of an Indian machine-tool company in which they’d invested, even though the earnings weren’t distributed to them. If the high court rules in the Moores’ favor, it could lead to hundreds of billions of dollars in refunds to giant multinational companies that paid the mandatory repatriation tax. Some ob

A pair of high-profile fraud trials are competing for headlines out of New York courtrooms, with accountants serving as marquee witnesses. Accounting has been a common theme across both the criminal trial of Sam Bankman-Fried, who faces federal fraud charges for allegedly siphoning customer funds from the now-bankrupt FTX cryptocurrency exchange, and the civil trial of former President Donald Trump, who is accused by the New York attorney general of inflating the value of real estate on years of his financial statements. As financial frauds have become more complex, accountants increasingly play a role in court—as witnesses, experts, or even the accused. On this episode of Talking Tax, Amanda Iacone, Bloomberg Tax senior reporter, spoke with Bruce Dubinsky, a forensic accountant whose work has spanned frauds involving Enron, Parmalat, and Bernie Madoff. They talked about how the role of accountants in the courtroom has evolved and how their testimony has unfolded in these two trials. Do you have feedback on t

Legislation and proposed regulations on cryptocurrency have the potential to answer some open questions about the taxation of digital assets, though not all of the possible changes may be welcomed by industry. A bill from Sens. Cynthia Lummis (R-Wyo.) and Kirsten Gillibrand (D-N.Y.) touches on a variety of crypto tax issues. It would provide a narrow definition of broker for tax reporting, require the marking of crypto assets to market for year-end accounting purposes, and closea tax loophole that may upset some in the industry. The Senate Finance Committee also asked for more information on those crypto taxation issues earlier this fall. On this episode of Talking Tax, Lisa Zarlenga, the head of Steptoe & Johnson LLPs tax policy practice and a former tax legislative counsel at the Treasury Department, spoke to Bloomberg Tax about that legislation and new proposed regulations on tax reporting rules for crypto brokers. Closing a tax loophole that allows investors to claim losses by quickly selling and repurcha

The IRS's new unit to tackle pass-through entity tax-law enforcement could take years to stand up fully and for businesses to feel its impact in the form of tougher audits. The push comes after years of concern among IRS officials that the agency lacked the expertise and resources to enforce laws around pass-through entities such as large partnerships, sparking fears some companies were manipulating the rules to pay less than they owed. But setting up and staffing up the new unit won't be easy. On this episode of Talking Tax, Mary McNulty, a partner at Holland and Knight LLP, spoke to Bloomberg Tax about the purpose of the new unit and what it has to do to be successful. "The wild card here is funding," she said. "So if Congress continues to cut the $80 billion of additional funding to the IRS and reduces the resources again to low levels then the IRS will lack the resources to carry out this strategic initiative, so time will tell.” Do you have feedback on this episode of Talking Tax? Give us a call and leav

State taxpayers have been sitting on a mountain of cryptocurrency assets for nearly a decade. According to one estimate, by the tax software and compliance firm Revenue Solutions Inc., 4.7 million California residents have stockpiled crypto assets valued at $56.2 billion, while 2.3 million New Yorkers are hoarding $27.7 billion in crypto. Are any of them paying capital gains taxes on the accumulated wealth tied up in Bitcoin, Ethereum, Tether and other digital tokens? And what about those investments in digital art, like Bored Ape Yacht Club non-fungible tokens? Tax compliance analysts believe barely a trickle of tax revenue linked to digital assets is flowing in the direction of state revenue departments. The reasons are varied. Revenue agencies and auditors just don’t understand the crypto landscape. States and taxpayers alike lack full guidance from the federal government. Tracking digital asset transactions is difficult, and connecting them to specific taxpayers is even harder. Fran D’Antonio, solutions s

Overhauling how the IRS audits low-income taxpayers is a critical step toward more fair audits, many in the industry acknowledged following the agency's announcement earlier this month. The IRS promised that it would "substantially" reduce audits on refundable tax credits that benefit low-income taxpayers, such as the earned income tax credit. That change follows a study released in January that found Black taxpayers claiming the EITC were audited at higher rates than non-Black taxpayers claiming the credit. Former National Taxpayer Advocate Nina Olson, now executive director of the Center for Taxpayer Rights, spoke with Bloomberg Tax's Erin Slowey about the impact the audit shift will have on low-income taxpayers and the landscape for claiming the EITC leading up to this announcement. "It is the difference between being able to have medical care or being able to pay rent or even if you're homeless, putting a deposit down and first month's rent on an apartment," Olson said. "It's life-changing funds." Do you

The new CEO of Deloitte's tax practice is grappling with many of the same challenges as the Big Four firm's clients: rapid shifts in how tax practitioners work thanks to artificial intelligence, a shortage of skilled staff, and reforms that will impose a new global minimum tax. Companies are starting to get their arms around the new rules that will impose a 15% global minimum tax and whether they should tackle implementation in-house or seek outside help, said Carin Giuliante, chair and CEO of Deloitte Tax LLP. Giuliante, the first woman to lead the firm’s US tax practice, took the helm in June and pledged to provide a “digital experience” to clients and to invest in training and career development for the firm’s professionals. She spoke to Bloomberg Tax & Accounting senior reporter Amanda Iacone about new Internal Revenue Service regulations for cryptocurrency assets, how artificial intelligence is reshaping the tax practice, and the firm’s ongoing commitment to diversify and support its workforce. Do you ha

Sports betting is in more states than ever, with new gamblers every day wagering in person and over the internet. And the new NFL season is expected to drive up tax revenue even more in the 30 states—plus Puerto Rico and Washington, D.C.—that have legalized sports betting since a 2018 US Supreme Court ruling overturning a federal ban. States collected an estimated $3.62 billion in direct gaming taxes generated in the second quarter, a 9.6% increase over the second quarter of 2022, according to a recent report from the American Gaming Association. While most states impose taxes ranging from 10% to 15%, some, like New York, take as much as 51% from sportsbooks. SportsHandle senior analyst Chris Altruda spoke with Bloomberg Tax reporter Angélica Serrano-Román about the approaches states have taken to taxing sports betting and those allowing operators to deduct so-called "free bets," which some states are starting to limit. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail

Congress' tax writers return to Capitol Hill with several priorities that remain unaddressed, as September shapes up to be a busy month with tax policy firmly in the mix. On the second part of a two-part podcast series looking at Congress as it returns from its August recess, we discuss the status of House Republicans' tax package and what would have to happen to get a bipartisan pact extending business tax breaks and enhancing the child tax credit. We also talk about GOP lawmakers' trip to Europe to meet with financial officials from the OECD and Germany, and the progress being made on a bipartisan Taiwan tax bill in September. Host David Schultz breaks down all this and more with Bloomberg Tax Congress reporters Chris Cioffi and Samantha Handler, running through the tax items on lawmakers' agenda. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

A year ago, the tax world was pleasantly surprised when Congress granted the chronically underfunded IRS an $80 billion windfall in the Inflation Reduction Act. Now that surprise is turning into dismay among some as Congress starts to claw back that money bit by bit. President Joe Biden agreed to reallocate about a quarter of that funding as a part of this spring's debt ceiling deal. And now Republican appropriators on Capitol Hill are proposing to take away even more of the money. On the first part of a two-part podcast series looking at Congress as it returns from its August recess, we sort out what this means with Janet Holtzblatt, a senior fellow at the Urban-Brookings Tax Policy Center and former unit chief for tax policy studies at the Congressional Budget Office. She spoke with Bloomberg Tax reporter Chris Cioffi about just how much the IRS could lose through this year's appropriations process and about what that would mean for the agency's grand modernization plans. Do you have feedback on this episod

Artificial intelligence has been helping companies with their taxes for a while—and now it’s on to the next stage. Companies have been using AI to automate and speed up the grunt work involved in their tax filings and tax compliance for some time. With the recent advance into “generative” AI—the type that can generate new content after being "trained" on mountains of data—the technology is being democratized, and put into the hands of tax professionals more broadly. It’s becoming almost like a “co-pilot” that’s helping practitioners do their jobs better, said Rema Serafi, national managing principal for tax at KPMG LLP. On this week’s episode of Talking Tax, Bloomberg Tax senior reporter Michael Rapoport speaks with Serafi on the future of AI and tax, including how AI will let companies tell their tax stories better, help with their tax planning, and navigate the ever-more-complex world of global tax rules. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-36

July was a big month for the OECD, marking its release of a tranche of documents detailing progress on the global tax deal agreed to by more than 130 countries in 2021. The agreement includes reallocation of the residual profits of large multinational companies to market jurisdictions, known as Pillar One, and a 15% global minimum tax, known as Pillar Two. On this week’s episode of Talking Tax, Bloomberg Tax reporter Lauren Vella speaks with Manal Corwin, director of the OECD's Center for Tax Policy and Administration, about nuances of the latest guidance and next steps to move the deal forward. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Demand from clean energy and corporate clients looking to secure their share of credits from the tax-and-climate law is helping boost tax and law firms' footprints. The Biden administration’s 2022 Inflation Reduction Act offers tax incentives to accelerate the US's transition into renewable energy. The tax credits from the law give companies and investors stability for at least the next 10 years. "It really put a stamp of approval on these transaction structures and the interest of the administration in exploring and facilitating the growth of renewable energy project development," Alexander Leff, partner at international law firm Clifford Chance, said in an interview. Those looking to benefit from those tax credits are leaning on these firms as the IRS and Treasury Department continue to release guidance on the law's provisions. On this week's episode of Talking Tax, Bloomberg Tax reporters Pavithra Rajesh and Erin Slowey talk with Leff about the wider implications of these clean energy provisions. He also d

The IRS rocked the name, image, and likeness industry after it released a memo saying that many organizations that fund college athletes won't be tax-exempt. The NCAA allows for college athletes and recruits to be compensated for the use of their name, image, and likeness—also known as NIL. NIL collectives were formed, often separate from the university, as a way to help fund and facilitate deals for athletes. Many of these collectives found creative ways, including vying for tax-exempt status, to attract donors. Ayden Syal, CEO and co-founder of MOGL, joins Bloomberg Tax's Erin Slowey on this week's episode of Talking Tax to break down the impact of the recent IRS decision and what it means for his company—a marketplace and software provider for student-athletes, universities, brands, and NIL collectives. Syal also talks about how his company helps college athletes during filing season and how he sees the NIL industry transforming over the next couple of years. Do you have feedback on this episode of Talking

Governments landed agreement on some of the global tax deal's biggest open issues earlier this month. But major political questions remain. The issues will play out over the coming years in the US and around the world, said Bob Stack, who was the Treasury Department's OECD tax negotiator under the Obama administration and is now a managing director at Deloitte. In a conversation with Bloomberg Tax's Isabel Gottlieb, Stack talked about the recent agreement by the negotiating governments that will shield US companies' US income from foreign minimum tax for an extra year, and what that means for future global tax legislation in the US Congress. Stack also talked about prospects for the agreed, conditional freeze on new digital services taxes during remaining negotiations over implementation of Amount A, the global deal's profit reallocation plan. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

The US Senate passed a long-stalled tax treaty with Chile last month, overcoming a dispute between Republicans and the Treasury Department over treatment of foreign tax credits. Business groups had been pushing for the measure to strengthen economic ties with the South American country and to allow companies to avoid double taxation. Chile is one of the biggest producers of lithium, a key element in batteries and other technology. On this week’s episode of Talking Tax, Bloomberg Tax reporter Chris Cioffi talks with Business Roundtable Vice President for Tax and Fiscal Policy Catherine Schultz about a range of topics, including the Chile tax treaty and the fate of other treaties pending in the Senate. They also discuss Republican concerns that emerged in this Congress over double taxation and how lawmakers resolved the issue, at least temporarily, in the treaty. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Unverified claims that the IRS plans to hire a horde of weapon-carrying agents are putting agency employees at risk, said Tony Reardon, longtime leader of the National Treasury Employees Union. "It places them squarely in danger," Reardon said, referring to charges from Republican politicians that thousands of armed agents would soon be probing Americans’ finances as a result of tax-and-climate law funds. Reardon, who's worked at NTEU for more than three decades and was first elected national union president in 2015, is set to retire in August. NTEU represents about 65,000 IRS employees as well as workers at dozens of other departments and agencies. On this week's episode of Talking Tax, he talks with Bloomberg Tax reporter Naomi Jagoda about a range of topics, including how things have changed for IRS employees over the years and how the IRS can improve recruitment and retention. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

The IRS has sounded the alarm multiple times over the past year about widespread scams associated with the employee retention credit—a pandemic-era tax incentive meant to encourage businesses to retain their employees during the worst of the Covid-19 crisis. Still, advertisements by third-party bad actors promoting the credit persisted, and faulty employee retention credit claims became so prevalent that in March, the IRS put the employee retention credit on its "Dirty Dozen" list of scams. The issue of false or incorrectly claimed credits has begun to bleed into the world of mergers and acquisitions, prolonging deals and creating more hours of due diligence work. On this week's episode of Talking Tax, Bloomberg Tax reporter Lauren Vella sits down with Jenn McCabe, a partner at Armanino LLP, to hear about the fallout from what was meant as a pandemic rescue plan. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Small family vineyards throughout France face an uncertain future as the cost to transfer estates within a family climb under a complicated system of inheritance taxation and rising property values from sales to foreign or institutional investors. The costs can be so great that some can’t pay the inheritance tax without running up long-term debt or selling off a portion of their estate. French lawmakers are considering ways to help reduce the tax burden for family vineyards, which number just 7,000 today. On this week’s episode of our podcast, Talking Tax, Bloomberg Tax correspondent Shaun Courtney talks about her reporting into the inheritance tax challenges facing France's small family-owned vineyards. She traveled to Champagne to visit a vineyard owned by Sophie Moussié, the fifth generation in her family to run the estate. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.