Income Tax

History of The Income Tax In The U.S. Part 2: 1980-1999

As perhaps would be expected, taxes were not much a part of our nation’s early history. Then the high cost of the War of 1812 brought about a need for revenue at the federal level and the nation’s first sales taxes were implemented. Fifty years later, Abraham Lincoln enacted emergency measures to pay for Civil War. In 1954, the 875-page Internal Revenue Code of 1954 was formulated. It was perhaps the most monumental overhaul of the federal income tax system to date. In 1969, the Tax Reform Act contained major amendments to the 1954 Tax Code.

Reagan-Bush Era

History of The Income Tax In The U.S., Part 1: The First Two Hundred Years

Our nation has existed since 1776. Some wonder whether the income tax has been around for as long. As perhaps would be expected, taxes were not much a part of our nation’s early history. After all, the Boston Tea Party involved a protest over a tariff, the Tea Act of 1773, imposed by the English crown. In the period directly preceding the 19th century, the United States imposed internal taxes on distilled spirits, tobacco, refined sugar, slaves, carriages, corporate bonds, snuff, and property sold at auction.

The 19th Century

The IRS Releases 2017 Inflation Adjustments

Now that we’re well into the New Year, taxpayers should know 2017’s inflation adjustments for several tax provisions set forth in Rev. Proc. 2016-55. These adjustments apply to tax years beginning in 2017 and transactions or events occurring during the 2017 calendar year. Many affect estate planners and expatriates.

*The 2017 taxable income thresholds on trusts and estates under § 1(e) are:

If Taxable Income is: The Tax is:
Not over $  2,550 15% of the taxable income
Over      $  2,550 but not over $ 6,000 $   382.50  plus 25% of excess over    $ 2,550

Trump’s Tax Plan Then And Now, Part 1

What specific tax plan will Donald Trump implement as President of the United States? Trump’s initial plan released in September 2015, set forth four tax brackets of 0%, 10%, 20% and 25%. In October, just prior to the election, he released a new plan that adopted the House Republicans’ approach using three tax brackets, 12%, 25% and 33%. Either plan seems to adopt aspects of the tax reform pursued by House Republicans, as the president-elect moves closer to the Republicans’ tax agenda. Here’s a look at Trump’s tax plan then and now.

President Trump’s 2005 Tax Returns – What It Tells Us

President Trump’s 2005 Tax Return – What It Tells Us

Yesterday, Tuesday March 14, 2017, while most of the New England area was buried in snow, MSNBC published President Trump’s 2005 income tax return – or at least the first two pages of it.  What does the return tell us and what does it not?

The Basics – We know he had a positive income in the amount of $152,737,866 and $103,201,242 in tax write-offs.  He paid a total of $38,435,451 in taxes for the year.

About Trump’s Tax Plan

It remains to be seen the specific tax plan that Donald Trump will implement as President of the United States. The effects of Donald Trump’s tax plan will depend on taxpayers’ income and tax planning. Some think that Trump’s plan will significantly reduce income and corporate taxes, and eliminate the estate tax. It seems the plan’s largest effect on individual taxpayers will be to reduce the top tax bracket 6.6 percentage points from 39.6 percent to 33 percent.

Can You Defer Your 2016 Income To 2017?

The end of the year is the perfect time for taxpayers to make financial adjustments to lower their tax bill for the current year. Making adjustments to income may help reduce tax liability. Income is typically taxed in the year it is received, however, if you don’t have to pay tax today and may pay it tomorrow, why not? Deferring income is an excellent strategy to lower an annual tax bill. However, only taxpayers that expect their tax bracket to remain the same or decrease to a lower bracket should defer income.

The (Trump’s) Net Operating Loss (NOL), Explained

At the beginning of October, the New York Times released pages from Donald Trump’s Connecticut, New Jersey and New York 1995 tax returns, apparently reflecting that the Donald declared “other income” of negative $916 million and was prepared to forego any federal income tax liability for up to 18 years by carrying forward this “net operating loss” (NOL). So what is a net operating loss?

Seven Deadly Tax Sins

7 Deadly Tax Sins

When it comes to the IRS, some bad acts are worse than others.  We have compiled below the top ones to avoid at all costs.  However, if you should find yourself in the middle of one, you should certainly call tax attorneys to get you out of the bad situation (yes, it is a bad situation).

Tax Benefits of Supporting Your Parents

Did you know you could be responsible for your parents’ unpaid bills? Ever heard of Filial Responsibility Laws?  Well, these are laws obligating you to provide financial support for your indigent parents.  Yes, obligated under law.  According to the National Center for Policy Analysis, 21 states across the country (including states like Connecticut, New Jersey and Massachusetts) allow for a civil action to obtain financial support for indigent parents.   At least 12 states may impose criminal penalties on children who refuse to support their parents.  Though rarely enforced, these laws may be dusted off by states looking to save money on Medicaid bills.

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