Budget Realities, IRS Funding, And… Psychedelics?
CBO budget estimates complicate plans for TCJA extension. TPC’s Howard Gleckman puts efforts to extend provisions of the Tax Cuts and Jobs Act into fiscal context with the latest Congressional Budget Office (CBO) estimates. Even without extending the TCJA provisions, by late 2034, CBO projects the federal debt will top $50 trillion, nearly twice what it was last year. By then, the federal government will be on track to spend more than 40 percent of all individual income taxes on interest on the debt.
TIGTA: IRS has spent ten percent of its IRA funding so far this fiscal year. The Treasury Inspector General for Tax Administration’s quarterly report notes the IRS spent $5.7 billion, or 10 percent, of the $57.8 billion in Inflation Reduction Act funding. The IRS must use its IRA funding before 2031 for normal operating expenses.
No tax-exempt status for religious organization that uses psychedelic drug. TaxNotes reports (paywall) the DC Circuit Court affirmed the IRS’s denial of tax-exempt status to the Iowaska Church of Healing. The organization claimed the IRS rejection of its tax-exemption application impeded its right to religious freedom. In June 2021, the IRS rejected the entity’s application because it was formed in part for the purpose of distributing dimethyltryptamine, a strong, illegal drug that can affect all human senses, thoughts, and emotions. Moreover, a significant part of the organization’s activities did not further the exempt purpose, the IRS argued.
On the international tax deal, Treasury insists Amount B and Amount A can’t be separated. Politico Pro reports that Scott Levine, Treasury’s top negotiator at the Organization for Economic Cooperation and Development, insists that the international tax deal’s standards for how all multinational companies assign income from certain activities to their subsidiaries (Amount B) must not be separated from the provision specifying taxing rights (Amount A) of the world’s largest countries. Some other countries want the link between Amount B and A to be voluntary, rather than mandatory.
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