An expanded child tax credit with some work requirements? Politico reports that the White House may agree to bar those who don’t work from claiming the credit. Progressives are pushing hard for a more generous credit that resembles the 2021 version and includes a full benefit for those with no income. But Republicans have insisted on a work requirement. Is there an agreement ahead if the White House abandons its demand for benefits for the unemployed?
Breaking another logjam. Hungary reportedly has agreed to support the global minimum tax in return for new assistance from the European Union. The EU needed unanimous support from member countries to endorse the levy but Hungary has withheld its backing for months. The agreement also includes more EU funding for Ukraine. The global tax still must be approved by each individual country.
More on the debate over the CTC and labor. TaxNotes economist Marty Sullivan weighs in on the dispute over whether an expanded CTC could reduce the labor supply, which would increase inflation. In the short term, “at least four recent studies using statistical analysis of data on recipients of the extended credit in 2021 find little or no negative effect on employment,” Marty reports. The jury’s still out on any long-run impact.
File taxes early, but not too early, warns IRS. The agency reminds filers to wait for key documents before submitting tax returns. Filers may need to include Form 1099-K, which reports income from third-party payment networks like Venmo or PayPal. The deadline for those forms is Jan. 31, so it might be prudent to wait until February or even early March to file. Meanwhile, advocates still are trying to convince Congress to repeal, or at least soften, tougher reporting rules that were included in the American Rescue Plan.
How might local governments in Missouri tax solar energy? A tax task force will meet next week to figure it out. The Missouri Supreme Court struck down a 2013 law that exempted solar energy projects from tax. The group expects to make its recommendations to the General Assembly by Dec. 31.
Wind energy provider sues a rural school district for big tax refunds. Consumers Energy, a Michigan utility, is suing taxing authorities in northern Tuscola County to win refunds for $8.5 million in taxes it paid on its wind farms. The problem: If the utility wins, a rural school district could lose $1.2 million, and other townships, libraries, and the sheriff’s office could lose money, too.
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