Data, More Data, And A Mansion Tax
Lawmakers ask tax prep industry about sharing sensitive taxpayer data. A group of seven Democratic lawmakers wrote letters to five tax preparation firms demanding to know whether they are transferring sensitive taxpayer data to tech companies for advertising purposes. The firms were to have ceased the practice earlier this year. The Federal Trade Commission warned the tax prep firms last month that they could face billions of dollars in fines if they are violating their customers’ privacy.
IRS braces for billions of crypto information returns. IRS director of digital assets Julie Foerster told the Council for Electronic Revenue Communication Advancement that the agency estimates it will receive 8 billion information returns (Form 1099-DA) once digital transaction reporting rules take effect, Tax Notes reports (paywall). It would double what the IRS now receives for every other Form 1099 combined. Foerster said that the agency’s current technology infrastructure couldn’t handle the volume, but added that Inflation Reduction Act funding should put in place the resources necessary to process the data.
“Mansion tax” challenge dismissed in Los Angeles County. Superior Court Judge Barbara Scheper dismissed the challenge to the transfer tax, known as Measure ULA in Los Angeles. The tax took effect on April 1 and charges a 4 percent tax on all residential and commercial real estate sales in the city above $5 million, and a 5.5 percent tax on sales above $10 million. The tax revenue will fund housing and homelessness-prevention efforts.
Gleckman: It’s dangerous to question the tax exemption of universities over their views of the Middle East. TPC’s Howard Gleckman considers the question implied by recent comments from House Ways & Means Chair Jason Smith (R-MO): Should universities that appear to be anti-Israel maintain their tax-exempt status? “Whatever your views on the Middle East, Smith is swimming in very dangerous waters,” warns Howard. “It endangers the free debate that already is at risk on many campuses and in civic life. And it is a strategy that might well backfire when political control of Congress changes, as it inevitably will.”
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