Taxes

If making money with minimal effort is a financial goal of yours, passive income just might be the answer. But what exactly counts as a passive activity from a tax standpoint? Let’s look at the different ways the IRS says you can earn passive activity income and how it affects your taxes. What is passive

With inflation continuing to skyrocket, especially for food, which reached 10.4 percent in June, it is worth examining how the ongoing U.S. trade war with China and U.S. tariff policy overall has impacted U.S. agriculture and food prices. The economic literature shows that the U.S. import tariffs and subsequent retaliatory tariffs imposed by China and

The on-again-off-again negotiations over the proposed Build Back Better tax increases on corporations and high-income earners appears to be… on again. Senator Joe Manchin (D-WV) is now expressing support for something called the Inflation Reduction Act of 2022, which includes a 15 percent corporate minimum tax, drug price controls, IRS tax enforcement, and a tax

As the reality of a second quarter of negative economic growth settles in Washington, the Congressional Budget Office (CBO) released its own sobering report on the government’s long-term finances. The CBO long-term budget outlook report shows widening deficits over the next three decades as both federal spending and tax revenues are expected to rise above

With the Indiana General Assembly gaveled in this week for a special session called by Gov. Eric Holcomb (R), one of the issues is how to allocate portions of the $6.1 billion budget surplus for the fiscal year that ended June 30. The House, Senate, and governor agree that some of the extra revenue should

Imagine a worker who gets a raise and ends up paying in tax more than 50 percent of that raise. This is the case for a Canadian worker who earns CAD 48,124. With an increase in pay of CAD 822, he would face a 59 percent marginal tax rate. This Canadian worker will end up

New Jersey’s proposed ban on the sale of menthol cigarettes (Assembly Bill 1989) would reduce excise and sales tax collections by as much as $243 million per year. And with the significant revenue loss, smoking rates are unlikely to decline. New Jersey lawmakers should look to the recent Massachusetts experiment to see what to expect

The Conservative Party in the United Kingdom is in the process of determining its new leader as Prime Minister Boris Johnson exits the stage. The new Conservative Party leader will be the next UK Prime Minister. The process has narrowed the field to two candidates: former Chancellor of the Exchequer Rishi Sunak and Foreign Secretary Liz

When thinking about tax policy, economists typically distinguish between the short run and long run. While there might be temporary boosts to the economy in the short term from a tax cut due to increased incomes, changes in tax policy alter the incentives to work, save, and invest, which can produce benefits to economic growth

The global tax deal that was struck last year continues to move along in slow and uncertain ways. While the global minimum tax gets much attention in the media (and in my own writings, to be honest), there is another significant piece to the deal. The global minimum tax (also known as OECD Pillar Two) would

Student debt forgiveness has been at the forefront of recent federal policy discussions, with President Biden exploring using executive action to cancel up to $10,000 in student loan debt per borrower. Under current law, the tax code handles debt forgiveness differently depending on the borrower’s repayment plan—canceling student loan debt would have new, potentially complicated

Imagine a worker who gets a raise and ends up paying in tax the same amount as their raise. This is the case for a French worker who earns EUR 46,767. With an increase in pay of EUR 3,376, he would face a 93 percent marginal tax rate. This French worker will end up with

The Senate has begun debate on the so-called Chips bill, which would provide $52 billion in grants and $24 billion in tax credits to supposedly strengthen the production of semiconductors in the U.S. If this measure passes, U.S. semiconductors will join wool, mohair, helium, soybeans, ethanol, steel, credit unions, and Amtrak as industries thought to

Key Findings Taxpayers reported nearly $12.1 trillion of total income on their 2019 tax returns. About 68 percent ($8.3 trillion) of the total income reported on Form 1040 consisted of wages and salaries, and 82 percent of all tax filers reported earning wage income. Retirement accounts such as 401(k)s and pensions are important sources of

Table of Contents Key Findings Forty-five states and the District of Columbia collect statewide sales taxes. Local sales taxes are collected in 38 states. In some cases, they can rival or even exceed state rates. The five states with the highest average combined state and local sales tax rates are Louisiana (9.55 percent), Tennessee (9.547

The Biden administration has proposed several changes to the U.S. international tax system that would raise taxes on multinational enterprises (MNEs). Similarly, the OECD’s tax proposals would raise taxes on MNEs. Together, the proposals would affect patterns of international investment and potentially decrease the volume of foreign direct investment (FDI). Under the tax proposals in

On July 1st, Czechia assumed the rotating Council of the EU Presidency from France. The country will chair Council meetings and represent the Council in relations with other European Union institutions until the end of 2022. There are many tax-related files that remain in the legislative pipeline from the French Presidency that Czechia will need to

Imagine a worker who gets a raise and ends up paying more in tax than their raise. This is the case for an Italian worker who earns just above the average wage. With an increase in pay of just EUR 448, he would face a 116 percent marginal tax rate. Therefore, despite the pay increase,

Over the past decade, policymakers from both parties in Harrisburg have proposed reducing Pennsylvania’s 9.99 percent corporate net income tax (CNIT) rate but could not agree on an approach—until now. With enactment of HB 1342 as part of the 2022-2023 state budget, lawmakers finally succeeded in cutting what had been the second highest state corporate

A pending tax ballot measure in Idaho may take the prize for gaffe-riddled drafting. Proponents had a straightforward goal: to create a new top marginal individual income tax rate of 10.925 percent on high earners. That is dubious enough, as it would create the highest rate between New York and California. But through a series of