Tag: taxes and taxation

Income Tax Deadline Fast Facts | CNN

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Here’s a look at the annual income tax filing deadline in the United States. April 15, 2024, is the deadline to file 2023 income tax returns.

In fiscal year 2022, the IRS amassed more than $4.9 trillion in gross tax collections.

(Source: Center on Budget and Policy Priorities, FY 2023)
Medicare, Medicaid, CHIP, marketplace subsidies 24%
Social Security 21%
National Defense 13%
Economic security programs 8%
Benefits for veterans & federal retirees 8%
Interest on debt 10%
Education 4%
Transportation 2%
Natural resources and agricultrue 1%
Science and medical research 1%
Law enforcement 1%
International 1%
All other 4%

1862 – During the Civil War, the IRS is born when President Abraham Lincoln and Congress create the Commissioner of Internal Revenue and enact an income tax to pay war expenses. The first income tax levies 3% on incomes between $600 and $10,000 and 5% on anything over $10,000. This income tax lasts until 1872.

1895 – The Supreme Court rules in Pollock v. Farmers’ Loan and Trust Co. that taxing incomes uniformly throughout the United States is unconstitutional.

1913 – The 16th Amendment is ratified by the states, giving Congress the authority to enact an income tax. Congress also introduces the first 1040 form and levies a 1% tax on personal incomes over $3,000 with 6% surtax on incomes of more than $500,000.

1954 – The tax filing deadline is moved from March 15 to April 15, to give taxpayers more time to prepare their returns.

January 3, 1996 – Congress enacts the Taxpayer Bill of Rights to ensure relief from overzealous collection efforts on the part of IRS personnel.

March 20, 2020 – Secretary of the Treasury Steven Mnuchin tweets that tax day is moving from April 15 to July 15 due to the coronavirus pandemic.

March 17, 2021 – The IRS announces the filing deadline has been moved from April 15 to May 17, to allow filers more time to navigate tax situations complicated by the coronavirus pandemic.

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March 28, 2024
Lionel Messi Fast Facts | CNN

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CNN
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Here is a look at the life of soccer player Lionel “Leo” Messi, who plays for Argentina’s national team and Major League Soccer (MLS) club Inter Miami.

Birth date: June 24, 1987

Birth place: Rosario, Argentina

Birth name: Lionel Andrés Messi

Father: Jorge Messi, factory worker

Mother: Celia Cuccittini de Messi

Marriage: Antonela Roccuzzo (June 30, 2017-present)

Children: Ciro, Mateo and Thiago

As a young boy, Messi was diagnosed with a growth hormone deficiency. At age 13, he signed with Futbol Club Barcelona and moved to Spain. As part of the contract, FC Barcelona agreed to pay for Messi’s hormone treatments.

All-time leading scorer of FC Barcelona and Spanish soccer league La Liga.

Winner of the Ballon d’Or, or footballer of the year, a record eight times: a record four consecutive years (2009-2012) and again for 2015, 2019, 2021 and 2023.

Won the European Golden Shoe award six times: 2009-10, 2011-12, 2012-13, 2016-17, 2017-18 and 2018-19.

1995-2000 – Plays for the local club team, Newell’s Old Boys, in Rosario, Argentina.

2000-2003 – Signs with FC Barcelona and works his way up through Barca’s youth squads.

November 16, 2003 – Makes his team debut, as a replacement in a friendly match against FC Porto.

October 16, 2004 – Makes his official debut for FC Barcelona against Espanyol. Barca wins 1-0.

2007 – Establishes the Leo Messi Foundation, working to improve access to education and health care for children.

August 2008 – Leads Argentina’s soccer team to a gold medal at the Summer Olympics in Beijing.

March 11, 2010 – Messi is announced as a UNICEF Goodwill Ambassador.

2011-2012 season – Sets the all-time record for most goals scored in a single season for a major European football league, with 73 goals.

June 2013 – Prosecutors in Barcelona file tax fraud charges against Messi and his father for the period between 2007 and 2009. The complaint alleges that Messi and his father, aiming to lower their Spanish tax bill, sought to manage the player’s lucrative income from image rights through shell companies set up overseas. Messi denies all allegations of wrongdoing.

June 25, 2013 – Prosecutors in Barcelona tell CNN that Messi paid €10 million ($13 million) in taxes to cover the tax period 2010-2011, but efforts to prosecute him for alleged tax fraud from 2007 to 2009 are still ongoing.

August 14, 2013 – Messi and his father, Jorge Messi, make a “reparatory” payment of €5 million ($6.6 million) to Spanish authorities for allegedly committing tax fraud between 2007 and 2009.

September 27, 2013 – Messi and his father testify in a Barcelona court in a preliminary hearing over allegations they defrauded Spanish tax authorities of more than $5 million.

March 16, 2014 – Scores a hat-trick (three goals during a game), to become FC Barcelona’s all-time leading scorer with 371 goals, eclipsing the record set by Paulino Alcantara, who scored 369 goals.

May 2014 – Signs a new contract with FC Barcelona for a reported annual net of €20 million ($27 million).

June 2014 – A Spanish state prosecutor asks the judge to drop the tax fraud charges against Messi, but not his father.

July 13, 2014 – Messi wins the Golden Ball award for the best player of the World Cup tournament.

July 28, 2014 – A judge rules that the tax fraud case against Messi and his father will proceed, despite the Spanish state prosecutor’s June request that the charges against Messi be dropped.

November 22, 2014 – Messi scores a hat-trick to become the Spanish league’s all-time leading goalscorer with 253 goals, surpassing Telmo Zarra’s previous record of 251 goals.

October 8, 2015 – A Spanish court rules that Messi and his father will stand trial for tax fraud charges.

May 31, 2016 – The tax fraud trial begins for Messi and his father.

June 27, 2016 – Says he probably will retire from international soccer after Argentina loses the Copa America final to Chile on penalties.

July 6, 2016 – A Barcelona court fines Messi €2 million ($2.3 million), and sentences him to 21 months in prison for tax fraud. The Spanish courts reduces Messi’s prison sentence to an additional fine of €252,000 ($287,000) in July 2017.

August 12, 2016 – Messi announces that he will play for Argentina once again, having stated in June that he would retire from international soccer.

July 5, 2017 – Barcelona and Messi announce a contract extension that will keep Messi at Barca until June 30, 2021, and is reportedly worth €565,000 ($645,000) a week.

January 13, 2019 – Scores his 400th Spanish league goal in his 435th appearance, extending his record as La Liga’s all-time top scorer. Messi is the first player to score 400 times in any of Europe’s “big five” leagues.

August 2, 2019 – Messi is banned from all competition for three months and fined $50,000 by the CONMEBOL Disciplinary Court. The punishment comes after Messi accused South American football’s governing body of corruption, suggesting the 2019 Copa America was rigged in favor of hosts Brazil.

August 5, 2021 – Messi is leaving FC Barcelona, according to a statement from the club.

August 10, 2021 – French club Paris Saint-Germain announces signing Messi to a two-year contract with an option of extending for a third year.

January 2, 2022 – In a statement, Paris Saint-Germain announces Messi is one of four players of the French club to have tested positive for Covid-19. The other three players are Juan Bernat, Sergio Rico and Nathan Bitumazala.

May 30, 2022 – Speaks about his struggle to recover from Covid-19 after testing positive in January. He missed three matches: two in Ligue 1 and one in the French Cup. “It left me with after effects. It left me with after effects in my lungs. I came back and it was like a month and a half without even being able to run because my lungs were affected.”

December 18, 2022 – Argentina defeats France to win the World Cup. Messi, playing in his fifth and final World Cup, scores twice. Later, Messi wins his second Golden Ball award.

June 7, 2023 – Messi says he’s going to join the MLS club Inter Miami. “I made the decision that I am going to Miami. I still haven’t closed it one hundred percent. I’m missing some things but we decided to continue my journey there,” he says in an interview posted by Spanish outlets SPORT and Mundo Deportivo. On July 21, he makes his debut with the club.

August 19, 2023 – Messi scores to lead Inter Miami past Nashville FC in a penalty kick shootout to capture the Leagues Cup title and score the club’s first trophy.

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November 1, 2023
IRS has collected $160 million in back taxes by cracking down on millionaires | CNN Politics

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Washington
CNN
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The Internal Revenue Service has collected $160 million in back taxes this year by cracking down on millionaires who haven’t paid what they owe, the agency said Friday.

The recent effort to target high-income individuals has been boosted by an increase in federal funding provided by Democrats last year through the Inflation Reduction Act. Republicans have criticized the amount of money the IRS is getting, and future funding is uncertain.

In September, the IRS started seeking back taxes from about 1,600 taxpayers with income above $1 million and more than $250,000 in tax debt. So far, the IRS has closed 100 of those cases, collecting $122 million, it said Friday.

Earlier this year, the IRS collected $38 million from more than 175 high-income earners. That brings the total to $160 million so far this year.

“I think that the evidence that we’ve seen to date, in terms of the amount that we have recovered … points to this being a highly important effort for us,” IRS Commissioner Danny Werfel said on a call with reporters.

In one successful case, an individual was ordered to pay more than $15 million in restitution last month for falsifying personal expenses as deductible business expenses, including the construction of a 51,000-square-foot mansion complete with an outdoor pool and pool house, as well as tennis, basketball and bocce courts, according to an IRS press release. The person also falsified expenses for luxury vehicles, artwork, country club memberships and homes for his children.

Another individual pleaded guilty last week to filing false tax returns and skimming more than $670,000 from his business. The person spent $110,000 on personal expenses and $502,000 on gambling, the IRS said.

The agency’s effort to ramp up enforcement aims to narrow what’s known as the “tax gap,” the difference between the amount owed and the amount actually collected on time by the IRS. The most recent estimate shows that $688 billion was not collected during tax year 2021.

The IRS plans to bring a new focus to cracking down on large corporations that have not been paying the taxes they owe.

The agency will target US subsidiaries of foreign companies that distribute goods in the US and do not pay what they owe in taxes on the profit they earn. It will start sending compliance notices next month to about 150 subsidiaries to “reiterate their US tax obligations and incentivize self-correction,” the announcement said.

As new accountants come on board at the IRS in early 2024, they are expected to begin 60 audits of some of the largest corporate taxpayers. The targeted corporations will be selected by the IRS accountants using a combination of artificial intelligence and subject matter expertise that will better detect tax cheating. The use of technology is meant to help avoid burdening taxpayers with needless audits.

The Inflation Reduction Act, which included a provision to deliver $80 billion to the IRS over 10 years, has allowed the agency to begin a complete overhaul of its operations. It’s working to hire new staff, update technology, improve taxpayer services and audit tax cheats.

The new funds have already helped improve taxpayer services at the IRS. In the 2023 filing season, it answered 3 million more calls and cut phone wait times to three minutes from 28 minutes compared with the year before.

The IRS is currently working on building its own free tax filing program, known as Direct File, that will launch as a limited pilot program next year.

The IRS has also put a plan in motion to digitize all paper-filed tax returns by 2025. The move is expected to cut processing times in half and speed up refunds by four weeks.

Republicans have raised questions about whether the $80 billion investment in the IRS would lead to increased audits for average Americans. Earlier this year, Republican lawmakers were able to reclaim $20 billion of the funding in a bipartisan deal to address the debt ceiling.

The White House argued that the cut won’t fundamentally change what the IRS can do over the next few years. Biden administration officials have also repeatedly said that taxpayers earning less than $400,000 a year won’t face an increase in audits due to the new funding.

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October 20, 2023
Britain’s PM seeks to rally his party ahead of an election they are tipped to lose | CNN

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London
CNN
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Rishi Sunak will gather with members of his governing Conservative Party on Sunday for what is likely to be their final party conference before the UK’s next general election, which Sunak is currently projected to lose.

The Conservatives come together for their annual meeting with little good news to celebrate. The party is trailing the opposition Labour Party in the polls by a significant distance.

Sunak has been criticized by moderates in the party for tacking to the right on key issues like immigration and commitments to reducing carbon emissions. He is also being attacked from the party’s right for what they perceive to be an anti-conservative approach to taxation and public debt.

As if Sunak’s job uniting his party this week wasn’t hard enough, the Institute for Fiscal Studies, the leading economic research institute in the UK, published a report projecting that taxes will account for around 37% of national income by the next election – the highest level since World War II.

Party conference season is an important date fixture in the annual British political calendar. Taking place in the early fall, these jamborees are the principal forums for each party to outline its priorities for the next 12 months.

For the governing party, conference is typically a time when members rally around the leadership and unite against the opposition, insulated from whatever is happening in the wider world of politics.

This should be especially true as an election approaches. However, Sunak, who wasn’t even the Conservatives’ leader this time last year, has inherited a broken party that has been in power for so long it seems out of ideas and already preparing for the post-mortem and blame game that follows any election loss.

And factions on both the left and right of the party are already publicly criticising Sunak on a range of issues.

Examples coming into this year’s conference:

Former cabinet minister Priti Patel told British channel GB News on Friday that the tax burden was “unsustainable” before unfavourably comparing Sunak to tax-cutting former PM, Margaret Thatcher.

The Conservative-supporting Daily Mail newspaper ran a column titled: “Didn’t the Tories used to be party of tax CUTS?”

Sunak can also expect vocal criticism from the environmental wing of his party after a significant U-turn last week on climate policy. Sunak delayed a planned moratorium on the sale new gasoline and diesel cars from 2030 to 2035 and pushed back on plans to phase out gas boilers in homes.

Some Conservatives who support action on the climate crisis, not least former PM Boris Johnson, criticised Sunak, saying the UK “cannot afford to falter now” or “lose our ambition.”

Such a direct criticism of a sitting PM by a former PM is highly unusual. What makes it particularly painful for Sunak is that Johnson is at the heart of perhaps the most crucial internal battle within the Conservative Party.

Johnson was forced to resign from office because of a range of scandals last summer. However, Johnson’s most loyal acolytes believe that Sunak’s decision to quit as Johnson’s finance minister was the straw that broke the camel’s back and made Johnson’s position untenable. They believe he was motivated by the opportunity to take a run at the top job himself, something Sunak denies.

This battle between Sunak and Johnson has created a very strange dynamic within the party.

Johnson, darling of the Conservative right since the Brexit referendum, is in many ways politically to the left of Sunak. However, his pragmatism over Brexit and cautious economics has led to his allies painting Sunak as a Conservative sellout.

They also believe that Sunak’s betrayal of Johnson and apparent wish-washy centrism is what will ultimately cost the Conservative Party the next general election – ignoring the damage that Johnson did to the party and its standing in the polls through his scandal-ridden premiership.

Sunak has made attempts to counter these attacks by throwing red meat at Conservative MPs and voters. The U-turn on climate policies is just the most recent example. He’s made a crackdown on immigration – particularly the route across the English Channel from France in so-called small boats – a key plank of his agenda since taking office.

He’s been accused of sowing division over over the complex issue of trans rights in attempts to win over his own MPs and has leant into the Johnsonite position of attacking “lefty lawyers” over opposition to his plans, including those on immigration.

His hard-line shift doesn’t necessarily resonate with the public, most polls show. Which is why experts believe that Sunak is doubling down on his Conservative base, which might be his only real path to retaining power at the next election.

“Sunak’s strategy of taking on issues like net zero and small boats is very much a ‘core vote’ strategy, aimed at securing the Conservative base,” says Will Jennings, professor of politics at the University of Southampton.

“This is not without risk – firstly because it’s not clear how large that core vote is without Boris Johnson, Brexit and Jeremy Corbyn (the controversial, hard-left former Labour leader) and also because voters have other concerns right now – most notably the economy,” he adds.

If you talk to senior Conservatives right now, there is a quiet acceptance that a loss is the most likely result of the next election. Most agree that not only does this look like a government in its death throes, but also that everyone is already thinking about who will replace Sunak after his defeat. Factions on the right and left of the party are already forming and people on both sides are already talking about how to win the battle for the soul of their party.

While the next election may not be a foregone conclusion, the next few months will be critical if Sunak is to start turning the polls around and make the comeback of all comebacks. All of that starts this week in Manchester: a good conference could lift the mood and rally the troops; a bad conference could be the kiss of death to any hope his party had left.

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October 1, 2023
That jet the Marines lost? Taxpayers will pay $1.7 trillion for the F-35 program | CNN Politics
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A version of this story appears in CNN’s What Matters newsletter. To get it in your inbox, sign up for free here.

CNN
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The military losing a fighter jet near Charleston, South Carolina, and asking the public to help find it is a plotline in which “Top Gun” (fighter jets) meets “The Hunt for Red October” (country can’t find its weapons system).

But the larger story of the F-35 Lightning II stealth fighter is like tax dollars meet “The Blob” (unstoppable force consumes everything in its path).

“How in the hell do you lose an F-35?” wondered Rep. Nancy Mace, the South Carolina Republican, in a post on social media that speaks for everyone who read the headline about the state-of-the-art military plane that went missing Sunday after its pilot ejected and parachuted to safety.

“How is there not a tracking device and we’re asking the public to what, find a jet and turn it in?” she continued.

A more general and important question could be asked of the F-35 program writ large: How in the heck can you spend so much money on a plane that doesn’t work the way it’s supposed to?

The exact amount of money for a single aircraft like the one that went missing is somewhere around $100 million.

The entire F-35 program is on track to cost $1.7 trillion over the lifetime of the plane. Trillion. With a “t.”

CNN’s Oren Liebermann reported the facts of what we know about the missing aircraft on CNN on Monday:
The pilot ejected safely and was taken to a hospital.

Joint Base Charleston posted a social media plea for information from anyone who might have seen the jet or its remains.

The search is focused northwest of Charleston near Lakes Marion and Moultrie.
But we’re left with so many questions, he told CNN’s Jim Sciutto.

“Was the transponder working? If not, why wasn’t it working? Why, maybe, had it been switched off? What was the mission it was on? All of this is either under investigation or a question we haven’t gotten an answer to yet.”

When I asked Liebermann by email how to generally explain the F-35 program, he noted it is the most expensive weapons program in US history.

For a country that spends a good portion of its income on its military and is known to have the most advanced fighting force on Earth, that’s saying something.

The F-35 is what’s known as a “stealth” fighter, which means it is supposed to be able to avoid detection by enemies. Maybe a little too stealth.

But if you watch the glossy Lockheed Martin video at F35.com, the jet is also supposed to be able to communicate with rest of the military, “sharing its operational picture with the ground, sea and air assets.” The video shows the jet beaming information to the ground and satellites.

The New York Times’ editorial board used the word “boondoggle” to describe the F-35 program in 2021. But it added that the US is essentially stuck with the program.

Or as CNN’s Zachary Cohen wrote back in 2015, “Is the world’s most expensive weapons program worth it?” Eight years later, the question still applies.

Many US allies – Canada, Germany, Japan and others – also buy F-35s from Lockheed.

The F-35, as developed by Lockheed at the request of the US military, was supposed to be the jack-of-all-jets, with versions to do different jobs for the Air Force, the Navy and the Marines.

The version that went missing over South Carolina – the F-35B – is used by the US Marine Corps and meant to be able to “land vertically like a helicopter and take-off in very short distances,” according to a fact sheet from Lockheed. Another F-35B crashed in 2018, also in South Carolina.

The Project on Government Oversight, a nonpartisan watchdog group, has written extensively on the F-35 and its cost overruns. I asked Dan Grazier, an F-35 expert for POGO, what has gone wrong.

It all boils down to “failure at the conceptual level,” he told me in an email.

“The architects of the program attempted to build a single aircraft to meet multiple mission requirements for not just three separate services but also those of multiple countries,” Grazier said, noting the difference between a small and nimble fighter jet and a long-range jet.

“When someone attempts to design a single aircraft to perform all of these roles, they have to make numerous design tradeoffs that generally results in an aircraft that can sort of do it all, but doesn’t do anything particularly well.”

The jet has never reached its full operational capability and already needs updates and tweaks, including a new engine. “Every F-35 built until now is nothing more than a very expensive prototype,” Grazier told me.

“All of them will have to go through an expensive retrograde process in the future when the design is complete to bring them up to something approaching full combat standards.”

I asked a spokesperson for Lockheed Martin if the company is confident the jets perform as they should considering the taxpayer investment.

They provided this statement:

The global F-35 fleet has surpassed more than 721,000 cumulative flight hours and spans 17 nations and three U.S. military services. Since F-35s began flying 17 years ago, there has been one pilot fatality and less than 10 confirmed destroyed aircraft. More than 965 F-35s have been delivered and more than 430,000 sorties completed.

Diana Maurer is director of defense capabilities and management at the Government Accountability Office, the government’s own watchdog that earlier this year described the F-35 program as “more than a decade behind schedule and $183 billion over original cost estimates.”

She said pilots frequently report being impressed by the plane’s capabilities. But they also report not being able to fly it often enough.

Problems getting spare parts, issues with repairs and a reliance on contractors all contribute to the F-35 having a substandard readiness and frequent groundings of the fleet.

“There’s a variety of reasons why they can’t get these aircraft up in the air as often as they would like,” Maurer said. “And that’s really frustrating from a taxpayer perspective for something that already costs hundreds of millions of dollars a year; cost many, many multiple billions already; and will cost nearly $2 trillion over the life cycle of the program.”

Grazier said officials at the Pentagon have acknowledged problems with the F-35 that can be applied to the design process in the future. But this is a program that evolved over successive presidencies and with a rotating cast of characters in charge both in Congress and at the Pentagon.

The system is supposed to have safeguards against extreme cost overruns, but when those warnings were triggered in previous decades, the F-35 program was allowed to barrel forward. And here we are.
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September 18, 2023
Fact check: Republicans make false, misleading claims at first Biden impeachment inquiry hearing | CNN Politics

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CNN
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The Republican-led House Oversight Committee is holding its first hearing Thursday in the impeachment inquiry of President Joe Biden – and Republicans on the committee have made a series of false and misleading claims, as well as some other claims that have left out critical context.

Below is a CNN fact check. This article will be updated as additional fact checks are completed.

Republican Rep. James Comer, the chairman of the House Oversight Committee, said in his opening remarks at the hearing on Thursday that the committee has uncovered how “the Bidens and their associates created over 20 shell companies” and “raked in over $20 million between 2014 and 2019.”

Facts First: The $20 million figure is roughly accurate for Joe Biden’s family and associates, according to the bank records subpoenaed by the committee, but the phrase “the Bidens and their associates” obscures the fact that there is no public evidence to date that President Joe Biden himself received any of this money. And it’s worth noting that a large chunk of the money went to the “associates” – Hunter Biden’s business partners – not even Biden’s family itself.

So far, none of the bank records obtained by the committee have shown any payments to Joe Biden. And a Washington Post analysis in August found that, of about $23 million in payments the committee had identified from foreign sources, nearly $7.5 million went to members of the Biden family – almost all of it to Hunter Biden – and the rest to people Hunter Biden did business with. (The Post also questioned the use of the vague phrase “shell companies,” noting that “virtually all of the companies” that had been listed by the committee at the time had “legitimate business interests” or “clearly identified business investments.”)

A Republican aide for the House Oversight Committee disputed the Post’s analysis on Thursday, saying that bank records obtained by the panel actually show that, of $24 million in payments between 2014 and 2019, $15 million went to members of the Biden family and $9 million went to associates. CNN has reached out to the Post for comment; the committee has not publicly released the underlying bank records that would definitively show the breakdown in payments.

The records obtained by the committee have shown that during and after Joe Biden’s tenure as vice president, Hunter Biden made millions of dollars through complex financial arrangements from private equity deals, legal fees and corporate consulting in Ukraine, China, Romania and elsewhere. Again, Republicans have not produced evidence that Joe Biden got paid in any of these arrangements.

Republican Rep. Jim Jordan of Ohio repeated a false claim about Hunter Biden that CNN debunked when Jordan made the same claim last week.

Jordan claimed that Hunter Biden himself said he was unqualified to sit on the board of directors of a Ukrainian energy company, Burisma Holdings.

“Hunter Biden’s not qualified, fact number two, to sit on the board. Not my words, his words. He said he got on the board because of the brand, because of the name,” Jordan said Thursday.

Facts First: It’s not true that Hunter Biden himself said he wasn’t qualified to sit on the Burisma board. In fact, Hunter Biden said in a 2019 interview with ABC News that “I was completely qualified to be on the board” and defended his qualifications in detail. He did acknowledge, as Jordan said, that he would “probably not” have been asked to be on the board if he was not a Biden – but he nonetheless explicitly rejected claims that he wasn’t qualified, calling them “misinformation.”

When the ABC interviewer asked what his qualifications for the role were, he said: “Well, I was vice chairman on the board of Amtrak for five years. I was the chairman of the board of the UN World Food Programme. I was a lawyer for Boies Schiller Flexner, one of the most prestigious law firms in the world. Bottom line is that I know that I was completely qualified to be on the board to head up the corporate governance and transparency committee on the board. And that’s all that I focused on. Basically, turning a Eastern European independent natural gas company into Western standards of corporate governance.”

When the ABC interviewer said, “You didn’t have any extensive knowledge about natural gas or Ukraine itself, though,” Biden responded, “No, but I think I had as much knowledge as anybody else that was on the board – if not more.”

Asked if he would have been asked to be on the board if his last name wasn’t Biden, Biden said, “I don’t know. I don’t know. Probably not.” He added “there’s a lot of things” in his life that wouldn’t have happened if he had a different last name.

A side note: Biden had served as the board chair for World Food Program USA, a nonprofit that supports the UN World Food Programme, not the UN program itself as he claimed in the interview.

Jordan cited new documents obtained from IRS whistleblowers, made public by House Republicans on Wednesday, to argue that the Justice Department improperly blocked investigators from asking about Joe Biden in a 2020 search warrant related to Hunter Biden’s overseas dealings.

“We learned yesterday, in the search warrant…examining Hunter Biden electronic communications, they weren’t allowed to ask about Political Figure 1,” Jordan said. “Political Figure number 1 is the big guy, is Joe Biden.”

Facts First: This is highly misleading. The Justice Department official who gave this instruction said Joe Biden’s name shouldn’t be mentioned in the search warrant because there wasn’t any legal basis to do so. Furthermore, this occurred during Trump’s presidency, so it doesn’t prove pro-Biden meddling by the Biden-era Justice Department.

The August 2020 email from a deputy to now-special counsel David Weiss, the Trump-appointed federal prosecutor who is leading the Hunter Biden probe, said the warrant was for “BS,” an apparent reference to Blue Star Strategies, a lobbying firm that represented Burisma Holdings, the Ukrainian energy company where Hunter Biden was on the board.

The Weiss deputy said in the email that “other than the attribution, location and identity stuff at the end, none if it is appropriate and within the scope of this warrant” and that “there should be nothing about Political Figure 1 in here,” according to emails released by House Republicans. Another document released by the GOP confirm that Joe Biden is “Political Figure 1.”

Before obtaining a search warrant, investigators need to establish probable cause and secure approval from a judge. If federal prosecutors believed the references to Joe Biden weren’t within the legal scope of what the warrant was looking for, it wouldn’t have been appropriate or lawful to include them.

Comer said in his opening remarks that the committee recently uncovered “two additional wires sent to Hunter Biden that originated in Beijing from Chinese nationals; this happened when Joe Biden was running for president of the United States – and Joe Biden’s home is listed on the beneficiary address.”

Facts First: This lacks important context. Comer was correct that the committee has found evidence of two wire transfers sent to Hunter Biden from Chinese nationals in the second half of 2019, during Joe Biden’s presidential campaign, but he did not explain that Joe Biden’s home being listed as the beneficiary address doesn’t demonstrate that Joe Biden received any of the money. Nor did he explain that there may well be benign reasons for the inclusion of the address. Hunter Biden has lived at his father’s Wilmington, Delaware, home at times and listed that address on his driver’s license; Hunter Biden’s lawyer Abbe Lowell said in a statement to CNN this week that the address was listed on these transfers simply because it was the address Hunter Biden used on the bank account the money was going to, which Lowell said Hunter Biden did “because it was his only permanent address at the time.”

“This was a documented loan (not a distribution or pay-out) that was wired from a private individual to his new bank account which listed the address on his driver’s license, his parents’ address, because it was his only permanent address at the time,” Lowell said in the statement. “We expect more occasions where the Republican chairs twist the truth to mislead people to promote their fantasy political agenda.”

White House spokesman Ian Sams wrote on X, formerly known as Twitter, on Wednesday: “Imagine them arguing that, if someone stayed at their parents’ house during the pandemic, listed it as their permanent address for work, and got a paycheck, the parents somehow also worked for the employer…It’s bananas…Yet this is what extreme House Republicans have sunken to.”

Comer told CNN this week his panel is trying to put together a timeline on where Hunter Biden was living around the time of the transfers, which occurred in July 2019 and August 2019. Joe Biden was a candidate in the Democratic presidential primary at the time.

Republican Rep. Nancy Mace of South Carolina claimed at the Thursday hearing, “We already know the president took bribes from Burisma,” a Ukrainian energy company where Hunter Biden sat on the board of directors.

Facts First: Mace’s claim is false; we do not “already know” that Joe Biden took any bribe. The claim about a bribe from Burisma is a completely unproven allegation. The FBI informant who relayed the claim to the FBI in 2020 was merely reporting something he said he had been told by Burisma’s chief executive. Later in the hearing, a witness called by the committee Republicans, George Washington University law professor Jonathan Turley, called “the bribery allegation” the most concerning piece of evidence he had heard today – but he immediately cautioned that “you have to only take that so far” given that it is “a secondhand account.”

According to an internal FBI document made public by Republican Sen. Chuck Grassley of Iowa earlier this year over the strong objections of the FBI, the informant said in 2020 – when Donald Trump was president – that the CEO of Burisma, Mykola Zlochevsky, had claimed in 2016 that he made a $5 million payment to “one Biden” and another $5 million payment to “another Biden.” But the FBI document did not contain any proof for the claim, and the document said the informant was “not able to provide any further opinion as to the veracity” of the claim.

Republicans have tried to boost the credibility the allegation by saying it was in an FBI document and that the FBI had viewed the informant as highly credible. But the document merely memorialized the information provided by the informant; it does not demonstrate that the information is true. And Hunter Biden’s former business associate Devon Archer testified to the House Oversight Committee earlier this year that he had not been aware of any such payments to the Bidens; Archer characterized Zlochevsky’s reported claim as an example of the Ukrainian businessman embellishing his influence.

Rep. Tim Burchett, a Tennessee Republican, falsely claimed that Hunter Biden never paid taxes on his foreign income.

He said Hunter Biden “failed to pay any taxes” on the millions of dollars he got from Ukrainian companies, and that this shows how “the Biden family doesn’t have to” pay taxes.

“Who’s going to write the check for the money Hunter Biden didn’t pay?” Burchett asked, adding that “hardworking Americans” would end up footing the bill.

Facts First: This is false. Hunter Biden repeatedly missed IRS deadlines, and his conduct was so egregious that federal investigators believe it was criminal, but he eventually belatedly paid all of his back taxes, plus interest and penalties, to the tune of about $2 million.

Documents from Hunter Biden’s criminal cases indicate that he repeatedly missed tax deadlines, even though he had the funds and was repeatedly warned by his accountant and business partners. He was prepared to plead guilty to two misdemeanors in July, for failing to pay taxes on time in 2017 and 2018, before the plea deal collapsed.

But there’s a difference between failing to pay taxes on time and failing to pay taxes at all. In 2021, while the criminal investigation was still underway and before any charges were filed, Hunter Biden paid roughly $2 million to the IRS to cover all the back taxes, plus penalties and interest.

Hunter Biden was able to make the massive payment thanks to a roughly $2 million loan from a friend and attorney who has been supporting him during his legal troubles, according to court filings.

Democratic Rep. Alexandria Ocasio-Cortez of New York accused a Republican member of the committee, Rep. Byron Donalds of Florida, of cutting out “critical context” from an image of a purported text message that Donalds displayed earlier in the Thursday hearing. Ocasio-Cortez also said that Donalds had displayed a “fabricated image.”

The dispute was over an image Donalds showed of a purported 2018 text message from the president’s brother James Biden to the president’s son Hunter Biden – provided by IRS whistleblowers and released by House Republicans on Wednesday – in which James Biden purportedly wrote, “This can work, you need a safe harbor. I can work with you father [sic] alone !! We as usual just need several months of his help for this to work.”

After showing the image, Donalds asked a witness at the committee, “If you saw a text message like this between the president’s brother and the president’s son, wouldn’t you be concerned about them trying to give plausible deniability for the president of the United States to not have any knowledge of said business dealings?”

Facts First: Donalds didn’t invent the James Biden text message, but Ocasio-Cortez was correct that Donalds left out critical context – specifically, context that showed there was no sign that the purported text exchange between James Biden and Hunter Biden was about business dealings. The information released by House Republicans this week appeared to show that James Biden’s purported text about getting “help” from Joe Biden came in direct response to a purported Hunter Biden text saying he could not afford alimony, school tuition for his children, food and gas “w/o [without] Dad.” Donalds did not display this purported Hunter Biden text at the Thursday hearing.

In other words, when James Biden purportedly mentioned the possibility of several months of help from Joe Biden, he gave no indication he was referring to some sort of business transaction, much less the foreign transactions that House Republicans have been focused on in their investigations into the president. But Donalds didn’t make that clear.

With that said, Ocasio-Cortez herself could have been clearer about what she meant when she claimed the image Donalds showed was “fabricated.”

The contents of the purported James Biden text Donalds displayed were not made up, according to the IRS whistleblowers. What appeared to be novel was the graphic Donalds used; he showed the text in a form that made it look like a screenshot from an iPhone text conversation, with white words over a blue background bubble. The House Republican spreadsheet that the words were taken from did not include any such graphics, and, again, it did include the preceding purported Hunter Biden message that Donalds didn’t show.

Republican Rep. Pat Fallon of Texas said at the Thursday hearing, “In an interview back in 2019 with The New Yorker, even Hunter admitted that he talked to his dad about business, specifically Burisma.”

Facts First: This needs context. The 2019 New Yorker article in question reported that Hunter Biden said he recalled Joe Biden discussing Burisma with him “just once” in a brief exchange that consisted of this: “Dad said, ‘I hope you know what you are doing,’ and I said, ‘I do.’”

It’s fair for Fallon to say that this counts as Joe Biden discussing business with his son, but Fallon did not mention how brief and limited Hunter Biden said the purported discussion was.

This story has been updated with additional information.

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August 2, 2023
Fact check: Biden makes false claims about the debt and deficit in jobs speech | CNN Politics

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Washington
CNN
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During a Friday speech about the September jobs report, President Joe Biden delivered a rapid-fire series of three false or misleading claims – falsely saying that he has cut the debt, falsely crediting a tax policy that didn’t take effect until 2023 for improving the budget situation in 2021 and 2022, and misleadingly saying that he has presided over an “actual surplus.”

At a separate moment of the speech, Biden used outdated figures to boast of setting record lows in the unemployment rates for African Americans, Hispanics and people with disabilities. While the rates for these three groups hit record lows earlier in his presidency, he didn’t acknowledge that they have all since increased to non-record levels – and, in fact, are now higher than they were during parts of Donald Trump’s presidency.

Here’s a fact check.

Biden said in the Friday speech that Republicans want to “cut taxes for the very wealthy and big corporations,” which would add to the deficit. That’s fair game.

But then he added: “I was able to cut the federal debt by $1.7 trillion over the first two-and-a – two years. Well remember what we talked about. Those 50 corporations that made $40 billion, weren’t paying a penny in taxes? Well guess what – we made them pay 30%. Uh, 15% in taxes – 15%. Nowhere near what they should pay. And guess what? We were able to pay for everything, and we end up with an actual surplus.”

Facts First: Biden’s claims were thoroughly inaccurate. First, he has not cut the federal debt, which has increased by more than $5.7 trillion during his presidency so far after rising about $7.8 trillion during Trump’s full four-year tenure; it is the budget deficit (the one-year difference between spending and revenues), not the national debt (the accumulation of federal borrowing plus interest owed), that fell by $1.7 trillion over his first two fiscal years in office. Second, Biden’s 15% corporate minimum tax on certain large profitable corporations did not take effect until the first day of 2023, so it could not possibly have been responsible for the deficit reduction in fiscal 2021 and 2022. Third, there is no “actual surplus”; the federal government continues to run a budget deficit well over $1 trillion.

CNN has previously debunked Biden’s false claims about supposedly having cut the “debt” and about the new corporate minimum tax supposedly being responsible for deficit reduction in 2021 and 2022. The White House, which declined to comment on the record for this article, has corrected previous official transcripts when Biden has claimed that the debt fell by $1.7 trillion, acknowledging that he should have said deficit.

As for Biden’s vague additional claim that “we end up with an actual surplus,” a White House official said Friday that the president was referring to how the particular law in which the new minimum tax was contained, the Inflation Reduction Act of 2022, is projected to reduce the deficit. But Biden did not explain this unusual-at-best use of “surplus” – and since he had just been talking about the overall budget picture, he certainly made it sound like he was claiming to have presided over a surplus in the overall budget. He has not done so.

Matthew Gardner, a senior fellow at the Institute on Taxation and Economic Policy, a liberal think tank, said in response to the White House explanation: “Well he didn’t say ‘budget surplus’ I suppose. But in federal budget conversations, the word surplus has a very specific meaning. It doesn’t mean ‘additional,’ it means revenues exceed spending.” He noted earlier Friday that there hasn’t been a federal budget surplus since 2001.

It’s worth noting, as we have before, that Biden’s Friday comments would be missing key context even if he had not inaccurately replaced the word “deficit” with “debt.” It’s highly questionable how much credit Biden himself deserves for the decline in the deficit in 2021 and 2022. Independent analysts say it occurred largely because emergency Covid-19 relief spending from fiscal 2020 expired as scheduled – and that Biden’s own new laws and executive actions have significantly added to current and projected future deficits. In addition, the 2023 deficit is widely expected to be higher than the 2022 deficit.

More on the corporate minimum tax

When Biden spoke Friday about “those 50 corporations that made $40 billion, weren’t paying a penny in taxes,” he was referring, as he has in the past, to an Institute on Taxation and Economic Policy analysis published in 2021 that listed 55 companies the think tank found had paid no federal corporate income taxes in their most recent fiscal year.

But it was imprecise, at best, for Biden to say Friday that we made “them” pay 15% in taxes. That’s because the new 15% minimum tax applies only to companies that have an average annual financial statement income of $1 billion or more – there are lots of nuances involved; you can read more details here – and only 14 of the 55 companies on the think tank’s list reported having US pre-tax income of at least $1 billion. In other words, some large and profitable companies will not be hit with the tax.

The federal government’s nonpartisan Joint Committee on Taxation projected last year that the tax would shrink deficits by about $222 billion through 2031, with positive impacts beginning in 2023. Gardner said Friday that he fully expects the tax to play a role in reducing deficits going forward, but he said its deficit-reducing impact “might be lower than expected” in 2023 because the Treasury Department – which has been the subject of intense lobbying from corporations that could be affected – has taken so long to implement the details of the law that the Internal Revenue Service ended up waiving penalties on companies that don’t make estimated tax payments on it this year.

Regardless, Gardner said, “The minimum tax did not reduce the deficit at all in fiscal years 2021 or 2022 because it didn’t exist during those years.”

Early in the Friday speech, Biden boasted of statistics from the September jobs report that was released earlier in the day. But then he said, “We’ve achieved a 70-year low in unemployment rate for women, record lows in unemployment for African Americans and Hispanic workers, and people with disabilities – folks who’ve been left behind in previous recoveries and left behind for too long.”

Facts First: Three of these four Biden unemployment boasts are misleading because they are out of date. Only his claim about a 70-year low for women’s unemployment remains current. While the unemployment rates for African Americans, Hispanics and people with disabilities did fall to record lows earlier in Biden’s presidency, they have since increased – to rates higher than the rates during various periods of the Trump administration.

Women: The seasonally adjusted women’s unemployment rate was 3.4% in September. That’s a tick upward from the 3.3% rate during two previous months of 2023, but it’s still tied – with two months of the Trump administration – for the lowest for this group since 1953, 70 years ago.

African Americans: The seasonally adjusted Black or African American unemployment rate was 5.7% in September, up from the record low of 4.7% in April. The current 5.7% rate is higher than this group’s rates during four months of 2019, under Trump.

Hispanics: The seasonally adjusted Hispanic unemployment rate was 4.6% in September, up from the record low of 3.9% from September 2022. The current 4.6% rate is higher than this group’s rates for every month from April 2019 through February 2020 under Trump, plus a smattering of prior Trump-era months.

People with disabilities: The unemployment rate for people with disabilities, ages 16 and up, was 7.3% in September, up from a record low of 5.0% in December 2022. (The figures only go back to 2008, so the record was for a period of less than two decades.) The current 7.3% rate is higher than this group’s rates during eight months of the Trump presidency, seven of them in 2019.

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August 2, 2023
Ex-Trump Org. executive testifies that Eric Trump led him to inflate values of some properties | CNN Politics

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CNN
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The former controller of the Trump Organization says that Eric Trump directed him to make certain decisions that led to the inflated valuations of several Trump properties.

Jeff McConney, also a co-defendant of former President Donald Trump, Eric Trump and Donald Trump Jr., testified Friday as the first week of the civil fraud trial came to an end.

Internal Trump Org. spreadsheets shown in court Friday show notations by McConney that say Eric Trump directed McConney in phone conversations about certain property valuations that would later appear on the financial statements the judge in this case has ruled fraudulent.

McConney testified that in those phone calls that Eric Trump directed him to factor certain things into the calculations that ultimately led to what the New York attorney general says are inflated valuations of properties including Seven Springs and the Trump National Golf Club Westchester.

(Attorneys for Eric Trump have argued he was not aware that any phone conversations with McConney were used to formulate value assets in the financial statements for Trump properties.)

The testimony came at the end of a dramatic week in New York. The former president attended the trial for three days, turning the trial into a media circus. He was also issued a gag order after making false allegations about one of Judge Arthur Engoron’s clerks.

“I can tell you this trial, in all my 33 years, it’s chaos,” Trump attorney Christopher Kise said during a separate appeals court hearing Friday afternoon.

Allen Weisselberg, Trump’s long-time chief financial officer who served 5 months in prison for his role in a decade-long tax fraud scheme after making a plea deal, is expected to testify when the trial resumes Tuesday.

During his testimony McConney testified to the methodologies that he used to compute asset valuations like Mar-A-Lago which the attorney general’s office highlighted to the court as improper.

Under questioning by special counsel to the New York attorney general Andrew Amer, McConney said he calculated Mar-A-Lago’s valuation as though it could be sold as a private residence.

McConney testified that he did not know at the time that Trump had deeded away his right to develop the property beyond its use as a social club in 2005.

McConney also said that he and Weisselberg consciously agreed to calculate the value of apartments at Trump Park Avenue, without factoring in that the units were rent stabilized, which significantly lowers the real-estate value because they cannot be rented at market price.

The former controller said that he and Weisselberg increased the value of multiple Trump golf clubs by adding what they considered the value of Trump’s name on the properties, called a brand premium.

Amer produced the annual statements of financial condition that contained a note stating, “The goodwill attached to the Trump name has significant financial value that has not been reflected in the preparation of this financial statement.”

McConney confirmed he was aware that disclaimer was on the annual financial statements.

He also testified when valuing Trump’s Seven Springs development beginning in 2011, he included the value of seven homes not yet built at the property. He said he did this at the direction of Eric Trump, who oversaw the project.

Spreadsheets shown in court show McConney’s phone conversations detailing the methodology of the Seven Springs valuation.

McConney similarly included 71 unbuilt units as realized profits in the valuation for Trump’s Briarcliff, New York golf course. He did this on more than one financial statement even when the development approval of those units had been paused, he testified.

Amer also rehashed McConney’s testimony from the Trump Organization criminal tax fraud trial last year when the former controller said that he committed fraud at the behest of Weisselberg because he was afraid he’d lose his job.

Over defense objections, Amer reminded the judge that McConney admitted that he knew it was illegal to help Weisselberg commit fraud when he helped him not only cheat taxes but also cut a payroll check to Weisselberg’s wife so she could illegally receive social security benefits.

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August 2, 2023
Former IRS contractor accused of stealing Trump’s tax returns pleads guilty | CNN Politics

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CNN
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The former IRS contractor accused of leaking former President Donald Trump’s tax returns and stealing tax information on thousands of the wealthiest people in the US pleaded guilty in federal court on Thursday.

Prosecutors say Charles Littlejohn of Washington, DC, sent Trump’s tax returns and other data to two media outlets that “published numerous articles describing the tax information they obtained from the Defendant.”

Littlejohn pleaded guilty to the one count of disclosing tax information, which he was charged with in late September.

The contractor’s crime affected so many individuals that prosecutors plan to create a public website to notify the victims of any developments in the case.

During the plea hearing, an attorney for Trump gave a victim impact statement, calling the crime “an egregious breach.”

Trump’s attorney, Alina Habba, said that Trump’s returns were “kept in a vault at the IRS” and suggested that the leak may have cost Trump votes in the 2020 election.

Habba said Trump was opposed to the plea deal and called for the maximum sentence of five years in prison for Littlejohn.

Judge Ana Reyes, the federal judge overseeing the case, said she agreed “completely that anyone taking the law into their own hands is unacceptable.”

“I cannot overstate how troubled I am by what occurred,” Reyes said. “Make no mistake, this was not acceptable.”

A sentencing hearing has been scheduled for January 29.

This story has been updated with additional developments.

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August 2, 2023
Microsoft to appeal IRS request for nearly $29 billion in back taxes | CNN Business

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New York
CNN
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Microsoft plans to contest a US Internal Revenue Service request for an additional $28.9 billion in back taxes for the years 2004 to 2013, the company said in a securities filing Wednesday.

The demand is the result of a yearslong audit by the IRS into Microsoft’s past accounting practices. In particular, the agency took issue with how the company “allocated profits … among countries and jurisdictions,” Microsoft said in the filing.

“The IRS says Microsoft owes an additional $28.9 billion in tax for 2004 to 2013, plus penalties and interest,” the company said. It noted that the IRS’s determination is not final and does not include up to $10 billion in taxes Microsoft paid under the 2017 Tax Cuts and Jobs Act that could reduce its final bill.

The company said it plans to appeal the IRS request, a process that will likely take several years.

“We believe we have always followed the IRS’s rules and paid the taxes we owe in the U.S. and around the world,” the company said in the filing. “Since 2004, we have paid over $67 billion in taxes to the U.S.”

Microsoft noted that as it prepares to work through the IRS Appeals Process — and, potentially, the courts — the company believes its current “allowances for income tax contingencies are adequate.”

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August 2, 2023
California is about to give Hollywood studios a lucrative tax deal during the writers’ strike | CNN Business

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CNN
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The state of California is about to give movie and TV studios a new lucrative tax perk.

A bill awaiting California Gov. Gavin Newsom’s signature would the state’s tax incentive program for film and TV productions for five years but with a key update: Studios with more tax credits than they can use will be able to exchange those credits for cash. The bill, part of the state’s overall budget plan, was passed by California legislators on Tuesday, and Newsom is expected to sign it on Friday.

The bill also mandates any production that receives the tax credit to comply with new on-set firearm safety protocols following the 2021 deadly shooting on the set of Alec Baldwin’s film “Rust,” and it implements requirements aiming to meet diversity hiring targets.

The new, refundable tax credits come as competition for film and TV production from other states and countries is on the rise. States like New York and Georgia are gaining share of the TV and film market, thanks to their own tax incentive programs, according to a 2021 report from FilmLA — a nonprofit organization that helps creators with production planning and film permitting.

The bill should be a boon for studios like Netflix. The streaming giant had not previously been able to take full advantage of the tax credit program since it uses a separate research and development incentive from California to significantly reduce its tax liability. In a 2020 SEC filing, Netflix said it had $250 million in California R&D tax credits — far more than it could use.

Disney and Comcast’s Universal Studios were the only two studios that benefited under California’s existing tax incentive program, due to their relatively larger tax bills from theme parks, according to Democratic assemblywoman Wendy Carrillo, one of the bill’s sponsors. The new bill could benefit other studios that don’t have theme parks in the state, including Warner Bros, which is owned by CNN parent company Warner Bros. Discovery.

The bill’s safety measures require productions to employ an adviser to oversee production safety and complete detailed risk assessments. Studios must also establish training requirements and standards that focus on the safe handling of firearms. Many of these safety protocols were voluntary before the bill.

Dave Cortese, the Democratic state senator who introduced the safety protocols in the bill, said research for the legislation began soon after actor Baldwin fired a live round of ammunition from what he said he believed to be an unloaded prop gun during a film’s rehearsal. Cinematographer Halyna Hutchins was killed.

“Conversations about this legislation started the week after the tragic loss of a cinematographer. Those negotiations have produced the nation’s first and best safety practices for California workers in the state’s vital motion picture industry,” Cortese said.

In addition to refundable tax credits and stricter safety standards, the bill establishes specific diversity requirements. Studios must submit data about the diversity of their workforce to qualify for the full credit. The bill also adds a new member to the state’s film commission with diversity, equity, and inclusion expertise.

The tax perk for Hollywood comes amid ongoing tension between the industry’s workforce and the studios’ bosses. The Writers Guild of America, has been on strike since early May, halting the production of many shows. The association’s more than 11,000 members are fighting over substantial issues like pay, the number of writers staffed on any given project, and whether artificial intelligence can be used in writing material.

Actors may soon stage a work stoppage, as well. Members of the actors’ union, SAG-AFTRA, have voted to authorize a strike against the major studios if they cannot agree to the terms of a new contract. Similar to the WGA, the actors’ union has voiced similar concerns about pay and the use of AI.

Democratic lawmakers in California celebrated the bill. Carrillo said the plan was a “grand compromise,” and it would help protect jobs in the state.

“These are hundreds of thousands of jobs, most of which impact Los Angeles County and the city of Los Angeles. They’re good union jobs, they’re production jobs, they’re creative jobs,” she said.

However, the bill has attracted some criticism. Chris Hoene, the executive director of the California Budget & Policy Center, a nonprofit think tank that provides analysis on state budget issues intending to improve outcomes for low-income communities and people of color in the state, called it “bad policy.”

“Refundable tax credits were designed to help low-income households… so to take that refundability structure and apply it to a business tax credit, you would think there are some film companies that struggle to make ends meet and don’t make enough money to owe any taxes, but that’s not how it works,” he said.

Hoene called the new policy a “giveaway that doesn’t have any positive outcomes.”

The refundable credits are designed to help more than just the big studios, Carrillo said. Film and TV productions help support surrounding businesses in the area, including “small restaurants and catering services,” Carrillo said.

“It’s very important that California has a competitive advantage and ultimately keeps these jobs and productions in our state while other states continue to announce more incentives,” she added.

Still, Hoene argued that there were more effective ways to create well-paying jobs in California.

“If we wanted to take scarce state resources to help workers, we could do that in ways that could provide them with assistance directly, rather than giving it to large corporations who are already minimizing their tax bills in other ways,” he said.

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June 30, 2023
Tim Scott, the only Black Republican in the Senate, enters the 2024 GOP primary | CNN Politics

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CNN
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South Carolina Sen. Tim Scott on Monday formally entered the Republican presidential primary, promising to take on “the radical left” and bring faith and conservative, business-friendly policies to the White House, as he seeks to upend a contest that has so far been dominated by coverage of former President Donald Trump and Florida Gov. Ron DeSantis, who is expected to enter the fray in the coming days.

The most prominent Black figure in the Republican Party, Scott addressed supporters at his alma mater, Charleston Southern University, in his hometown of North Charleston.

“I’m the candidate the far-left fears the most. You see, when I cut your taxes, they called me a prop. When I refunded the police, they called me a token. When I pushed back on President Biden, they even called me the ‘n-word,’” Scott said. “I disrupt their narrative. I threaten their control. The truth of my life disrupts their lies.”

Following the announcement, Scott heads to Iowa, New Hampshire and South Carolina – states he frequented on his “Faith in America” tour in the run-up to his announcement – before returning to the Hawkeye State next week for GOP Sen. Joni Ernst’s annual “Roast and Ride” gathering.

Scott, 57, is no stranger to pathbreaking campaigns. In 2010, he became the first Black Republican elected to the US House of Representatives from South Carolina in more than a century. Years later, after being appointed to his Senate seat (he won a special election to retain the seat), Scott made history as the first Black US Senator from his native South Carolina.

Ahead of his entry into the presidential race, senior campaign officials briefed reporters on their view of the path forward, acknowledging he will need to win over support from Trump and DeSantis, but vowing – in a veiled dig at both – that his candidacy will strike a more optimistic tone and condemn the culture of victimhood and grievance that, as his aides described it, has taken over both parties.

“Our party and our nation are standing at a time for choosing,” Scott said. “Victimhood or victory? Grievance or greatness? I choose freedom and hope and opportunity.”

Trump and his team will avoid going after Tim Scott for now, two sources close to the former president told CNN. The directive from Trump has been to stay away from attacks on the South Carolina senator at the moment.

Last week, the Trump-aligned super PAC, MAGA, Inc., weighed in on Scott’s looming announcement, but used it to level an attack on DeSantis, not Scott.

The former president used that approach on Monday as he wished Scott “good luck” while taking a shot at DeSantis.

“Good luck to Senator Tim Scott in entering the Republican Presidential Primary Race. It is rapidly loading up with lots of people, and Tim is a big step up from Ron DeSanctimonious, who is totally unelectable. I got Opportunity Zones done with Tim, a big deal that has been highly successful. Good luck Tim!,” Trump posted on Truth Social.

The South Carolina senator received a boost on Sunday, less than 24 hours before his kick-off event, when news broke that his colleague Sen. John Thune of South Dakota, the No. 2 Republican in the Senate, planned to endorse him.

“I think he’d be a great candidate. I’m excited about it. I’ve been encouraging him,” Thune previously told CNN. “I think he’s getting a lot of encouragement from his colleagues. He’s really well thought of and respected.”

Cory Gardner, the former Republican senator from Colorado and leader of Scott’s aligned super PAC, also argued that his old colleague posed a unique threat to liberal Democrats.

“I think they’re terrified of him, and he’s right to say that, because he defies every narrative they have,” Gardner said. “And this is exciting for conservatives who believe that they have a candidate who carries their values, can implement their values and do so in a way that will make all Americans proud.”

In pictures: Presidential candidate Tim Scott

A senior campaign official said Scott will continue to invest resources and time in Iowa, New Hampshire and South Carolina, as the campaign ramps up.

Though Scott hails from South Carolina, they won’t count on it as a firewall, according to one senior campaign official, who emphasized Scott will have to compete as a top-tier candidate in other early primary and caucus states like New Hampshire and Iowa.

Even before the official launch, Scott revealed plans to pluck from his deep campaign coffers – with millions now transferred over from his Senate account – through a series of big-dollar ad buys in Iowa and New Hampshire.

The initial $5.5 million TV ad buy – including broadcast, cable satellite and radio – will air statewide starting Wednesday and run through the first GOP debate in August.

During the same period, Scott will also launch a seven-figure digital ad campaign.

“The biggest thing going for Tim Scott right now is $22 million in the bank. He is getting ready to spend $6 million in Iowa and New Hampshire that will garner tremendous name ID, and it’s gonna be a key factor that many of the other candidates are not doing right now,” said Dave Wilson, a South Carolina conservative strategist and former president of the Palmetto Family Council.

Though he is only officially entering the race now, Scott has already gotten caught in the churn of the campaign season. Shortly after announcing an exploratory committee last month, he was tripped up by questions over his position on a potential national abortion ban.

After initially sidestepping the matter and refusing to say whether he would back a 15-week ban, Scott told WMUR he would support restrictions beginning at 20 weeks. Days later, though, Scott said in an interview with NBC News that he “would literally sign the most conservative pro-life legislation that they can get through Congress.”

Pressed on what precisely that meant, given he had applauded DeSantis for signing a six-week ban in Florida, Scott demurred – saying it was a decision for the states to make.

“I’m not going to talk about six (weeks) or five or seven or 10,” Scott said.

Back at the senator’s home church near Charleston, there are hundreds of worshipers that see him most weekends.

“I’ve heard him talk about hope and opportunity for 25 years. It’s who he is. It’s a part of his story. And so I don’t think he’s going to change,” said Greg Suratt, founding pastor of Seacoast Church.

“I think a misconception that people might have about him is that his niceness, his humility, translates as weakness. And they don’t know the Tim Scott I know, I would like to kind of see it as an iron fist in a velvet glove,” Suratt added, noting that even people who disagree with his politics tend to like him as an individual.

Scott’s faith and his humble beginnings will be a central theme in his campaign, an aide said. Scott grew up in a single parent household in North Charleston, where his mother worked long hours to keep their family afloat.

“Think about the kid whose grandmother has to open the stove to heat the home in the middle of the winter. I think to myself, it kind of feels like that now,” Scott said at a town hall in New Hampshire this month. “So many people with our energy prices doubling in just the last couple years, are experiencing a crisis similar to the one that I had when I was just a kid.”

On his listening tour, Scott said that between the ages of 7 and 14, he “kind of drifted,” failing world geography, civics, English and Spanish in his freshman year of high school. But through the “tireless” encouragement of his mother and mentor, the late John Moniz, a Chick-fil-A manager, Scott says he was able to graduate from Charleston Southern University. He would eventually open his own insurance agency affiliated with Allstate.

Scott credits Moniz with teaching him that anyone can “succeed beyond their circumstances” if they take responsibility for themselves – a message he repeated in North Charleston.

“John taught me that anyone, from anywhere, at any time, can rise above their wildest expectations and imagination,” Scott said after giving roses to Moniz’s widow and his own mother at the beginning of his speech. “But first, I had to take responsibility for myself. He told me in the most loving way possible to look in the mirror and to blame myself.”

Scott’s political career began in 1995, when he ran in a special election to the Charleston City Council, winning a seat he would keep for nearly 15 years. After one term as a state lawmaker, Scott won a US House seat representing South Carolina’s 1st district.

Fellow presidential candidate and former South Carolina Gov. Nikki Haley then appointed Scott to the US Senate in 2012 to fill a vacancy left by Sen. Jim DeMint’s retirement. He retained the seat in a 2014 special election, was re-elected to a full term in 2016 and later won for a third time last year.

“To every single mom who struggles to make ends meet, who wonders if her efforts are in vain, they are not,” Scott said after being appointed by Haley.

During his time in the Senate, Scott has amassed a strictly conservative voting record, but has also led bipartisan police reform talks alongside New Jersey Sen. Cory Booker, a Democrat.

Those talks have gone on for years now, beginning in the summer of 2020 with then-California Sen. Kamala Harris also involved, but hopes for a comprehensive deal were effectively abandoned in 2021. (The conversations reportedly continue, but there is no legislation currently in the offing.)

In 2017, his “Investing in Opportunity Act,” which had some Democratic support, was included in the controversial Republican tax cut bill. The provision called for the establishment of “Opportunity Zones,” which would create tax incentives for businesses that invested in parts of the country struggling with poverty and stalled economies.

“I was one of the lead authors of the Republican tax reform bill that slashed taxes for families, brought jobs and investment back from overseas, and created my signature legislation, the ‘Opportunity Zones,’ that’s brought billions of dollars into the poorest communities that have been left behind,” Scott said in his speech. “That was just one bill. Imagine what we could do with an entire agenda.”

Still, Democrats in South Carolina welcomed Scott to the race with harsh words about his political record – and an attempt to tie him to the GOP’s far right.

“We know how dangerous Tea Party extremist Tim Scott is,” South Carolina Democratic Party chair Christale Spain said in a statement. “From promising to sign the most conservative abortion ban possible as president, to doubling down on his role as ‘architect’ of the 2017 GOP tax scam that pushed tax cuts for the ultra-wealthy at the expense of working families, Scott has proven himself to be just as MAGA as the rest of the 2024 field.”

Though Scott has expressed more openness to working with Democrats than most Republicans in Washington, he also owns one of the most conservative voting records in Congress. He rarely broke with Trump during the latter’s presidency, though he did criticize Trump’s response to White supremacist violence in Charlottesville, Virginia, in 2017.

“What we want to see from our president is clarity and moral authority,” Scott told Vice News at the time. “And that moral authority is compromised.”

Scott largely backed off that line, though, after a meeting with Trump in the White House.

“(Trump) was certainly very clear that the perception that he received on his comments was not exactly what he intended with those comments,” Scott told CBS News.

This story has been updated with additional reporting and reaction.

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May 22, 2023
US could default on its debt as soon as June 1 if Congress doesn’t act, Yellen says | CNN Politics

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CNN
—

The US could default on its obligations as soon as June 1 if Congress doesn’t address the debt limit before then, Treasury Secretary Janet Yellen said Monday.

“After reviewing recent federal tax receipts, our best estimate is that we will be unable to continue to satisfy all of the government’s obligations by early June, and potentially as early as June 1, if Congress does not raise or suspend the debt limit before that time,” Yellen wrote in a letter to House Speaker Kevin McCarthy.

The accelerated timetable increases pressure on President Joe Biden and House Republican lawmakers to ramp up their debt ceiling discussions. After months of talks being at a standstill, the president called all four congressional leaders on Monday afternoon and invited them to a May 9 meeting.

Yellen warned that the actual date that Treasury exhausts its ability to pay the government’s bills on time and in full could be “a number of weeks later than these estimates.” She noted that it’s impossible to pinpoint an exact date since the amount of revenue the federal government collects and the amount it spends is variable.

She will continue to update Congress as more information becomes available, but she reiterated that it’s “imperative” that lawmakers act as soon as possible.

“We have learned from past debt limit impasses that waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States,” Yellen wrote.

“If Congress fails to increase the debt limit, it would cause severe hardship to American families, harm our global leadership position, and raise questions about our ability to defend our national security interests,” she continued.

The Congressional Budget Office also updated its forecast on Monday, saying that there is a “significantly greater risk that the Treasury will run out of funds in early June” because of weaker-than-expected tax collections. It had originally projected that the default could happen between July and September.

When the US hit its $31.4 trillion debt ceiling in January, Yellen informed Congress that cash on hand and “extraordinary measures” should last at least until early June. But she warned the projection was subject to considerable uncertainty.

A variety of forecasters have estimated that the so-called X-date, when the US would default, would arrive over the summer or in the early fall.

The likelihood of an early June default grew in recent weeks when April tax receipts were coming in weaker than expected. A trio of analysts issued reports warning that the default date could hit soon.

However, a surge of tax revenue last week prompted two analysts to revise their forecasts to the second half of July.

If tax collections wind up being enough to keep Treasury’s coffers flush through early June, then it’s likely the government won’t default until much later in the summer. The agency will get another injection of funds from second quarter estimated tax payments, which are due June 15, and from an extraordinary measure that becomes available at the end of that month.

Biden told the congressional leaders – Senate Majority Leader Chuck Schumer, Senate Minority Leader Mitch McConnell, House Minority Leader Hakeem Jeffries and McCarthy – that he wants to discuss the need to pass a clean bill to raise the debt ceiling.

The White House is maintaining its position that it will not negotiate over the debt ceiling.

The invitation comes after McCarthy noted earlier Monday that he had yet to hear from the president, nearly a week after the House passed its package to raise the debt ceiling by $1.5 trillion. However, the bill also includes spending cuts, beefed-up work requirements in safety net programs and other measures that Democrats would not accept.

Schumer sent a letter to colleagues on Monday voicing Senate Democrats’ opposition to the House package.

This story has been updated with additional information.

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May 1, 2023
‘You’ve underestimated us’: How McCarthy’s horse-trading stopped a GOP revolt in debt fight | CNN Politics

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CNN
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Speaker Kevin McCarthy rolled the dice.

As he took his short walk from the speaker’s suite to the House floor on Wednesday evening, the California Republican wasn’t entirely sure he would have the votes on the most important bill of his young speakership: To raise the $31.4 trillion national debt limit on Republican support alone.

McCarthy knew he was close but couldn’t guarantee it, according to a person familiar with the matter.

After months of internal discussions, the speaker had been engaged in round-the-clock talks with pockets of dissident members, cutting deals and horse-trading to pick off one GOP vote after another in his high-stakes fight – all an attempt to show the White House and the country that his party speaks with one voice on the consequential economic battle.

But one Republican member was absent on Wednesday – and some hard-right members would not explicitly say how they’d vote, forcing the speaker to make a risky bet. In the end, it was two Democratic absences that helped McCarthy: Allowing him to pass the bill on the narrowest of margins, 217-215, and now shifting the focus to the White House and Senate Democrats.

“We are the only ones to lift the debt limit to make sure this economy is not in jeopardy,” McCarthy beamed in the Capitol’s ornate Statuary Hall moments after the gavel came down, calling on President Joe Biden to negotiate a spending-cut deal he has resisted for months. He added: “You’ve underestimated us.”

It was an effort that was months in the making. Immediately after securing the speakership in a messy, 15-ballot race, McCarthy made the concerted decision to avoid the pitfalls of a predecessor, John Boehner, and allow rank-and-file members to feel like they could shape the ultimate package rather than being steamrolled by leadership. A dozen listening sessions were held by two members of his whip team, Reps. Tom Emmer of Minnesota and Guy Reschenthaler of Pennsylvania, starting in February and continuing with them calling every member through this past weekend. Then there were regular meetings of the so-called “five families” – nicknamed after the mob families in “The Godfather” – that represent various ideological factions of the conference and were led by Rep. Garret Graves of Louisiana.

But even after they had agreed to an outline of their deal last week, McCarthy continued to run into pitfalls. In a meeting last week in the basement of the Capitol, he and his team moved to appease conservatives who wanted to target tax breaks for biofuels in the Democrats’ Inflation Reduction Act. McCarthy agreed, prompting a furious pushback by Iowa Republicans, including a tense phone call between Gov. Kim Reynolds and McCarthy.

It was an issue that could have derailed the bill and one that put McCarthy in familiar crosshairs between competing factions of his conference. But he ultimately cut a deal past 2 a.m. on Wednesday and helped move closer to securing the votes more than 15 hours later.

“They realized that you were not going to be able to steamroll four people from Iowa,” said Rep. Zach Nunn, an Iowa freshman, referring to the four GOP members of the delegation.

Yet more problems emerged, and McCarthy moved to head them off. Rep. Nancy Mace told reporters Wednesday morning she was ready to vote against the plan over her concerns it didn’t go far enough to balance the budget. But after an afternoon meeting in his office, the South Carolina Republican said she would back the plan. The promise, according to a source familiar with the matter: Votes on bills dealing with women’s access to reproductive health care and a vote on a bill dealing with active shooter alerts.

“I haven’t gotten rolled yet by the leadership on anything,” Mace said, defending her deal-cutting.

The ultimate plan would raise the debt limit by $1.5 trillion and propose to implement a slew of spending cuts to domestic programs, in addition to new work requirements on Medicaid beneficiaries and provisions targeting Biden’s domestic and regulatory agenda. It would save $4.8 trillion over the next 10 years, according to the Congressional Budget Office. But the $1.5 trillion increase would only last through March 2024 at the latest.

In a private meeting in the Capitol, GOP leaders debated how high of a debt limit increase they should seek. Some had floated odd numbers because it sounded more intentional than an even number. One member suggested $1.69 trillion, but that was rejected because of the innuendos associated with such a figure, according to three GOP sources. Ultimately, a $1. 5 trillion increase was the number they settled on.

Republicans say the deal-cutting that has since transpired was the result of new relationships forged from McCarthy’s drawn-out fight for the speaker’s gavel in January.

“Absolutely, it has reaped benefits to everyone in the conference,” Rep. French Hill, a Republican of Arkansas, said of the relationships that were formed.

But passing the bill was never a sure bet – something McCarthy sensed last week as he moved to appease conservatives and push for a repeal of energy tax breaks.

“This is going to come back to bite us,” McCarthy warned conservatives last week, according to a person in the room, as they demanded the bill repeal green energy tax credits and other provisions in the Inflation Reduction Act. McCarthy feared taking that step would unlock a process allowing the Senate to later jam the House on thorny tax-related provisions.

But he had a more immediate problem: The governor of Iowa.

A fired-up Reynolds, the two-term Republican governor, was on the phone with McCarthy on Tuesday, relaying concerns over the provision in his debt ceiling plan to repeal tax breaks for ethanol use, according to people familiar with the call, warning it would be detrimental to farmers in her state.

All four GOP members of the Iowa delegation, who were also in constant communication with the governor, informed leadership in a Tuesday night meeting that clawing back the tax credits was a “red line” for them, according to sources in the room.

McCarthy now had a math problem. His allies had believed that the Iowa Republicans, some of the closest allies of leadership, would swallow the provisions and ultimately side with their party in their high-stakes fight with the White House. But they had miscalculated, forcing the speaker to cut a last-ditch deal after repeatedly insisting they would not open the bill to changes.

Nunn, the Iowa Republican, told CNN he learned about the deal at around 2:30 a.m. on Wednesday, when Graves came to his office along with Rep. Michelle Fischbach, a Minnesota Republican who had similar issues with the ethanol provisions.

“We had been in conversation throughout the entire day, but by Tuesday, we had really ratcheted up,” Nunn told CNN. “Iowa nice also means Iowa stubborn.”

It was an issue that GOP leaders had sought to avoid. They had worried that if they cut a deal with the Iowa delegation, they would have to make similar deals with members from fossil-fuel heavy districts in order to make them happy.

And the leadership knew if they were going to make 11th-hour changes to appease Midwestern Republicans, they’d have to offer some concessions to conservatives as well, and ultimately agreed to a faster implementation of the Medicaid work requirements. Yet even that wasn’t enough to satisfy some conservatives who had been pushing for that change – namely GOP Rep. Matt Gaetz of Florida, who was upset that the deal was cut at the last minute after the leaders said they wouldn’t change the bill, according to people familiar with the matter. He was one of four who later voted against the plan.

Rep. Ken Buck, a member of the whip team, said in the end, he voted “no” because the GOP bill didn’t do enough to reduce the deficit. The Colorado Republican told CNN, “$58 trillion with Biden’s numbers and $53 trillion, it’s just too much debt.”

But one member that McCarthy had been lobbying came through: freshman Rep. Eli Crane. The Arizona Republican had been wavering on the bill and was being heavily whipped by leadership, but said he ultimately backed the legislation because of his constituents.

“We conducted a poll at a teletown hall last night and the people that responded overwhelmingly supported this bill,” he told CNN. “It kind of surprised me, honestly.”

With this victory secured, McCarthy could later have an even bigger test on his hands: If he is forced to ask his conference to get behind any deal with Biden to raise the debt limit – something that almost certainly wouldn’t go as far as the House plan for spending cuts.

His members are watching him closely.

“What Kevin has assured us is he’s not coming back and presenting a watered-down version,” said Rep. Ralph Norman of South Carolina, a member of the House Freedom Caucus.

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April 26, 2023
EXCLUSIVE: Hunter Biden lawyers to meet with Justice Department officials next week as scrutiny of investigation intensifies | CNN Politics

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CNN
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Lawyers for Hunter Biden are scheduled to meet next week with US attorney David Weiss and at least one senior career official from Justice Department headquarters to discuss the long-running investigation into the president’s son, multiple sources familiar with the matter told CNN.

The Hunter Biden legal team had reached out to Justice officials in recent weeks, asking for an update on the case. As is routine when lawyers request a status update, they were invited to meet next week, according to one source familiar with the meeting.

Weiss, the US Attorney in Delaware who was appointed by former President Donald Trump, is overseeing an ongoing criminal case into President Joe Biden’s son.

After prosecutors narrowed down the possible charges Hunter Biden could face last year, there haven’t been any public developments. According to sources familiar with the investigation, prosecutors are still weighing whether to bring two misdemeanor charges for failure to file taxes, one count of felony tax evasion related to the overreporting of expenses, and a false statement charge regarding a gun purchase.

The Justice Department did not comment. A spokesperson for the US attorney’s office in Delaware declined to comment.

Hunter Biden has not been charged with any crimes and has previously denied any wrongdoing.

The scheduled meeting comes as the Hunter Biden legal probe is back in the spotlight after an IRS supervisory special agent reached out to Congress, claiming to have information about alleged mishandling and political interference in the case. While a letter from the agent’s lawyer to Congress does not name Hunter Biden, as that could be a violation of the tax code, a source familiar with the matter previously told CNN that the case is the one involving the president’s son.

The agent is seeking whistleblower protections to share the information with Congress, according to a letter obtained by CNN.

The special agent also claims to have information that contradicts Attorney General Merrick Garland’s testimony before Congress, the source familiar with the matter told CNN. “I have pledged not to interfere with that investigation, and I have carried through on my pledge,” Garland testified in March.

The IRS agent worked on Hunter Biden’s criminal case and contends that the president’s son is being treated differently than other individuals would be in terms of violations of the tax code, sources familiar with the agent’s allegations said. The agent reported up the chain of command about his concerns of the treatment of Hunter Biden’s returns and tax filings, one of the sources added.

Congressional committees are in active conversations about when and how to interview the whistleblower. The IRS agent’s team wants him to do one interview with the committees, and have Democrats and Republicans present for it, the source said.

In recent months, as Republicans took control of the House and the federal case appeared to stall, Hunter Biden’s legal team decided to pursue a more aggressive and litigious approach to his defense, despite what one source described as objections from top White House advisers. For instance, one of Hunter Biden’s lawyers recently sued former Trump aide Garrett Ziegler, accusing him of harassment. Hunter Biden’s team also has accused in court a Delaware computer repair shop owner of trying to invade Hunter Biden’s privacy and wrongfully sharing his personal data for political purposes.

CNN has reached out to Ziegler for comment.

Sources close to Hunter Biden have attacked the IRS agent’s motives and note that even if the whistleblower has evidence of the investigation being mishandled, it would be about government conduct and not about Hunter Biden.

The IRS agent’s allegations are primarily focused on improper politicization of the case at the Justice Department and FBI instead of at the Treasury Department or IRS, according to a source familiar with the matter.

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April 21, 2023
Today is Tax Day. Here’s what you need to know if you haven’t filed your return yet — and even if you have | CNN Business
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Editor’s Note: This is an updated version of a story that originally ran on April 14, 2023.

New York
CNN
—

It’s April 18, the official deadline to file your federal and state income tax returns for 2022. (It is also, apparently, National Animal Crackers Day for those who celebrate.)

Whether you have already filed your tax return or still need to, the good news is this tax filing season has gone much more smoothly than the past three, which were hurt by the pandemic.

“This is the first tax season since 2019 where the IRS and the nation were on normal footing,” IRS Commissioner Danny Werfel said in a call with reporters.

For instance, Werfel noted that since January, thanks to an infusion of some new funding after years of budget cuts, IRS employees have been able to answer 87% of calls from filers with questions. Last year, they answered fewer than 15%. And the wait times on those phone calls dropped to just 4 minutes this filing season from 27 minutes last filing season.

The agency also added a roster of new online tools for filers, he added.

Those online tools may be especially helpful today if you are scrambling to get your return in before midnight. Or, if you’ve come to the realization that you need to file for an extension. Either way, here are some key things to know:

Not everyone has to file on April 18: If you live in a federally declared disaster area, have a business there — or have relevant tax documents stored by businesses in that area — it’s likely the IRS has already extended the filing and payment deadlines for you. Here is where you can find the specific extension dates for each disaster area.

Thanks to many rounds of extreme weather in recent months, for instance, tax filers in most of California — which accounts for 10% to 15% of all federal filers — have already been granted an extension until Oct. 16 to file and to pay, according to an IRS spokesperson.

If you’re in the armed forces and are currently or were recently stationed in a combat zone, the filing and payment deadlines for your 2022 taxes are most likely extended by 180 days. But your specific extended filing and payment deadlines will depend on the day you leave (or left) the combat zone. This IRS publication offers more detail.

Lastly, if you made little to no money last year (typically less than $12,950 for single filers and $25,900 for married couples), you may not be required to file a return. But you may want to anyway if you think you are eligible for a refund thanks to, for instance, refundable tax credits such as the Earned Income Tax Credit. (Use this IRS tool to gauge whether you are required to file this year.) You also are likely eligible to use IRS Free File (intended for those with adjusted gross income of $73,000 or less) so it won’t cost you to submit a return.

Your paycheck may not be your only source of income: If you had one full-time job you may think that is the only income you made and have to report. But that’s not necessarily so.

Other potentially taxable and reportable income sources include:
Interest on your savings

Investment income (e.g., dividends and capital gains)

Pay for part-time or seasonal work, or a side hustle

Unemployment income

Social Security benefits or distribution from a retirement account

Tips

Gambling winnings

Income from a rental property you own
Organize your tax documents: By now you should have received every tax document that third parties are required to send you (your employer, bank, brokerage, etc.).

If you don’t recall receiving a hard copy of a tax form in the mail, check your email and your online accounts — a document may have been sent to you electronically.

Here are some of the tax forms you may have received:
W-2 from your wage or salaried jobs

1099-B for capital gains and losses on your investments

1099-DIV from your brokerage or company where you own stock for dividends or other distributions from their investments

1099-INT for interest over $10 on your savings at a financial institution

1099-NEC from your clients, if you worked as a contractor

1099-K for payments for goods and services through third-party platforms like Venmo, CashApp or Etsy. The 1099-K is required if you made more than $20,000 in over 200 transactions during the year. (Next year the reporting threshold drops to $600.) But even if you didn’t get a 1099-K you still must report all the income that you made over third-party platforms in 2022.

1099-Rs for distributions over $10 that you received for a pension, annuity, retirement account, profit-sharing plan or insurance contract

SSA-1099 or SSA-1042S for Social Security benefits received.
“Be aware that there’s no form for some taxable income, like proceeds from renting out your vacation property, meaning you’re responsible for reporting it on your own,” according to the Illinois CPA Society.

One very last-minute way to reduce your 2022 tax bill: If you’re eligible to make a tax-deductible contribution to an IRA and haven’t done so for last year, you have until April 18 to contribute up to $6,000 ($7,000 if you’re 50 or older). That will reduce your tax bill and augment your retirement savings.

Proofread your return before submitting it: Do this whether you’re using tax software or working with a professional tax preparer.

Little mistakes and oversights delay the processing of your return (and the issuance of your refund if you’re owed one). You want to avoid things like having a typo in your name, birth date, Social Security number or direct deposit number; choosing the wrong filing status (e.g., married vs single); making a simple math error; or leaving a required field blank.

What to do if you can’t file by April 18: If you’re not able to file on time, fill out Form 4868 electronically or on paper and send it in no later than today. You will be granted an automatic six-month extension to file.

Note, however, that an extension to file is not an extension to pay. You will be charged interest (currently running at 7%) and a penalty on any amount you still owe for 2022 but haven’t paid by April 18.

So if you suspect you still owe tax — perhaps you had some income outside of your job for which tax wasn’t withheld or you had a big capital gain last year — approximate how much more you owe and send that money to the IRS by the end of today.

You can choose to do so by mail, attaching a check to your extension request form. Make sure your envelope is postmarked no later than April 18.

Or the more efficient route is pay what you owe electronically at IRS.gov, said CPA Damien Martin, a tax partner at EY. If you do that, the IRS notes you will not have to file a Form 4868. “The IRS will automatically process an extension of time to file,” the agency notes in its instructions.

If you opt to electronically pay directly from your bank account, which is free, select “extension” and then “tax year 2022” when given the option.

You can also pay by credit or debit card, but you will be charged a processing fee. Doing so, though, may become much more costly than just a fee if you charge your tax payment but don’t pay your credit card bill off in full every month, since you likely pay a high interest rate on outstanding balances.

If you can’t pay what you owe in full, the IRS does have some payment plan options. But it might be smart to first consult with a certified public accountant or a tax preparer who is an enrolled agent to make sure you are making the best choice for your circumstance.

If you still owe income taxes to your state, remember that you may need to go through a similar exercise of filing for an extension and making a payment to your state’s revenue department, Martin said.

Use this interactive tax assistant for basic questions you may have: The IRS provides an “interactive tax assistant” that can help you answer more than 50 basic questions pertaining to your individual circumstance on income, deductions, credits and other technical questions.

If you’ve already filed your return, you’re probably glad to have it in the rear view mirror. But you may still have a few questions about what’s ahead.

What about my refund? If you are due a refund, the IRS typically sends it within 21 days of receiving your return. When yours does arrive, it may be smaller than last year, even if your financial life didn’t change much. That’s because a number of Covid-related tax breaks expired.

So far, the average refund paid was $2,878 for the week ending April 7, down from $3,175 at the same point in last year’s filing season.

Will I be audited?: The reasons and methods for auditing a taxpayer can vary — and many audits result in “no change,” meaning you don’t end up owing anything more to the IRS. But one thing is common for the vast majority of US tax filers: Audit rates are exceedingly low.

For filers reporting incomes between $50,000 and $200,000, only 0.1% of them were audited in 2020, according to the latest data from the IRS. Even for very high income filers, audit rates were quite low: Just 0.4% for those reporting income of between $1 million and $5 million; 0.7% for those with income between $5 million and $10 million; and 2.4% for returns with income over $10 million.

Looking ahead, the IRS commissioner noted in a press call that the agency will be using money from the Inflation Reduction Act to bolster its compliance efforts to focus more on auditing high-income individuals — defined as making $400,000 or more. As for filers with income below that level, he said he did not anticipate any change in the likelihood they would be audited.
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April 18, 2023
Opinion: Why millionaires like us want to pay more in taxes | CNN

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Editor’s Note: Abigail Disney is an Emmy-winning documentary filmmaker, activist, and member of the Patriotic Millionaires. Her latest film, “The American Dream and Other Fairy Tales,” co-directed with Kathleen Hughes, made its world premiere at the 2022 Sundance Film Festival. Morris Pearl is the chair of Patriotic Millionaires, and former managing director of BlackRock. The opinions expressed in this commentary are their own. View more opinion on CNN.

CNN
—

Tuesday is Tax Day in America, one of the most stressful days of the year, when many taxpayers will finally end their procrastination, file their federal returns, and hope for a refund from the IRS. But for many of the nation’s wealthiest, it’s just another Tuesday.

Tax Day isn’t just a filing deadline — it’s also an annual reminder that the ultra-rich exist in an entirely separate world when it comes to taxes. For us, the loopholes are bigger and the rates are sometimes lower. Meanwhile, the rich keep getting richer, with the wealth of billionaires in particular growing by more than $1.5 trillion over the last few years.

This status quo is unfair, but even more importantly, it’s unsustainable. Such high levels of inequality are pushing our economy and our democracy to their breaking points. That’s why we should examine how we can set our country up for long-term stability and prosperity. And we should start by ensuring that the ultra-rich pay more of what they owe the country that made their success possible.

There are three changes to the tax code that would help us do just that:

Right now, the US tax system values money over sweat. If you work hard for your money instead of earning it passively, you’re essentially penalized for it. People who earn a salary pay significantly higher tax rates on their income than wealthy investors who passively earn capital gains income.

Inheriting money is an even better deal. Thanks to former president Donald Trump’s 2017 tax law, the first $12.92 million (or $25.84 million for a married couple) is completely exempt from any estate tax, and the stepped-up basis loophole allows wealthy families to permanently erase millions in capital gains taxes by resetting the market value of those assets to their value at the time of the original owner’s death. With this, it becomes relatively simple for the rich to inherit tens, even hundreds of millions of dollars, and pay almost nothing in taxes. Someone working for that money, on the other hand, would pay over a third of it in federal income taxes.

Why do we have a tax code that says working people should be taxed more than wealthy investors and those who got rich just by virtue of being born into the right family? At the end of the day, money is money, whether you worked for it or whether you inherited it. As an heiress and an investor, we should not be paying lower tax rates than people who earn their money from working.

It’s time for the tax code to treat all income equally by taxing all capital gains over $1 million at the same rates as ordinary income, and replacing our loophole-ridden estate tax with a simpler inheritance tax that treats inherited wealth as income.

We can’t just focus on income, however, because many of the richest Americans earn basically no taxable income of any kind in a typical year. Capital gains are only taxed when assets are sold, so instead of selling them, the ultra-rich use their assets as collateral to borrow vast sums of money at extremely low interest rates to live on, and then declare little or even negative “income” on their tax forms. This “Buy, Borrow, Die” strategy is a major reason billionaires paid a lower effective tax rate over recent years than working-class families.

By rethinking what is taxable, we can get access to the trillions of dollars of billionaire wealth that is untouchable under our current tax structure. That’s why President Biden has proposed the Billionaire Minimum Income Tax, which would tax the unrealized capital gains of the wealthiest households and why others have proposed wealth taxes on billionaires.

Finally, one of the most straightforward changes needed is to simply tax the extremely rich more than the merely rich. Our income tax caps out at a top rate of 37% for any income over $578,125 (or $693,750 for married couples). No matter how much more someone makes, they’ll never pay more than 37% in federal income taxes.

While someone earning $600,000 is certainly making enough to live a very comfortable life, they’re in a different world than someone making $600 million a year. In order to reflect the real differences between the rich and the ultra-rich, we need to return to the top rates we had through the most prosperous decades of the 20th century and add significantly more tax brackets. They should reach up to 90% for people making more than $100 million a year.

These three changes certainly won’t fix all our country’s problems on their own, but they would go a long way in stopping the steady flow of our country’s wealth toward a smaller and smaller group of people, a change that would make both our democracy and our economy more stable. The tax code can be a powerful tool for both social and economic change. We just need to use it more effectively.

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April 17, 2023
The cream-cheese-stuffed bagel is here | CNN Business

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New York
CNN
—

In the 1990s, Pizza Hut unveiled an important cheese-in-bread innovation, the stuffed crust pizza. Now, Philadelphia cream cheese and H&H Bagels, a New York City-based bagel shop, are trying to please the carbohydrate- and dairy-loving communities with a new and dubious spin on the stuffed crust: The bagel stuffed with cream cheese.

But unlike stuffed-crust pizzas, the bagel is filled with cheese after it is baked, making it more of a cream cheese bagel donut, if not in spirit then at least in form.

The bagels are “baked fresh daily and then cooled to be individually stuffed with Philly’s signature cream cheese one at a time,” according to Jay Rushin, CEO of H&H. “H&H Bagels use a pastry tool to pipe in the Philly cream cheese by hand,” he added. “The process leaves very small holes where the insertions are made, similar to a jelly donut.”

The obvious question, as is often the case with food mash-ups, is why. What’s so wrong with slicing a bagel and slathering on a healthy amount of cream cheese? Why must we pre-cheese the bagel? Because, Philly owner Kraft Heinz and H&H say, the simple acts of cutting and spreading are taxed, at least in New York.

“New York City may be the bagel capital of the world, but its residents incur a ludicrous ‘bagel tax’ each time they opt to purchase a bagel that’s sliced and schmeared with cream cheese,” the companies said in a release.

That’s true, sort of. New York doesn’t have a specific bagel tax, explained Ryan Cleveland, a representative of the New York State Department of Taxation and Finance. But certain food products, including baked goods, are tax exempt, while prepared foods are not.

“It’s when a bagel becomes a sandwich or a prepared food that it then becomes taxable,” he said. In New York City, food sold at restaurants is taxed at 8.875%.

Philadelphia and H&H plan to skirt this rule with the stuffed bagel, which is available at H&H’s Manhattan locations for $1.90 each, from Friday through Tax Day on Tuesday, April 18; and also online.

“In today’s landscape, people are juggling enough hurdles, and having to pay an extra tax to enjoy their favorite bagel with Philly cream cheese should simply not be one of them,” said Keenan White, senior brand manager of Philadelphia cream cheese, in a statement.

White and Kraft Heinz

(KHC) may well care about their customers’ tax payments. But for food companies, marketing stunts are about creating buzz and staying at the forefront of customers’ minds when they visit the supermarket — or bagel shop.

Kraft in particular has in recent years been leaning into questionable combinations, like the Velveeta Martini and a hot dog flavored popsicle, to promote its brands and get attention.

Philadelphia cream cheese, which struggled with shortages in the past, turned that issue into a marketing opportunity as well. There’s no problem with supply now, according to the brand.

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April 14, 2023
Still haven’t filed your taxes? Here’s what you need to know | CNN Business
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So far this tax season, the IRS has received more than 90 million income tax returns for 2022.

That means tens of millions of households have yet to file their returns. If yours is among them, here are some last-minute tax-filing tips to keep in mind as the Tuesday, April 18 deadline approaches.

Not everyone has to file on April 18: If you live in a federally declared disaster area, have a business there — or have relevant tax documents stored by businesses in that area — it’s likely the IRS has already extended the filing and payment deadlines for you. Here is where you can find the specific extension dates for each disaster area.

Thanks to many rounds of extreme weather in recent months, for instance, tax filers in most of California — which accounts for 10% to 15% of all federal filers — have already been granted an extension until Oct. 16 to file and to pay, according to an IRS spokesperson.

If you’re in the armed forces and are currently or were recently stationed in a combat zone, the filing and payment deadlines for your 2022 taxes are most likely extended by 180 days. But your specific extended filing and payment deadlines will depend on the day you leave (or left) the combat zone. This IRS publication offers more detail.

Lastly, if you made little to no money last year (typically less than $12,950 for single filers and $25,900 for married couples), you may not be required to file a return. But you may want to anyway if you think you are eligible for a refund thanks to, for instance, refundable tax credits such as the Earned Income Tax Credit. (Use this IRS tool to gauge whether you are required to file this year.) You also are likely eligible to use IRS Free File (intended for those with adjusted gross income of $73,000 or less) so it won’t cost you to submit a return.

Your paycheck may not be your only source of income: If you had one full-time job you may think that is the only income you made and have to report. But that’s not necessarily so.

Other potentially taxable and reportable income sources include:
Interest on your savings

Investment income (e.g., dividends and capital gains)

Pay for part-time or seasonal work, or a side hustle

Unemployment income

Social Security benefits or distribution from a retirement account

Tips

Gambling winnings

Income from a rental property you own
Organize your tax documents: By now you should have received every tax document that third parties are required to send you (your employer, bank, brokerage, etc.).

If you don’t recall receiving a hard copy of a tax form in the mail, check your email and your online accounts — a document may have been sent to you electronically.

Here are some of the tax forms you may have received:
W-2 from your wage or salaried jobs

1099-B for capital gains and losses on your investments

1099-DIV from your brokerage or company where you own stock for dividends or other distributions from their investments

1099-INT for interest over $10 on your savings at a financial institution

1099-NEC from your clients, if you worked as a contractor

1099-K for payments for goods and services through third-party platforms like Venmo, CashApp or Etsy. The 1099-K is required if you made more than $20,000 in over 200 transactions during the year. (Next year the reporting threshold drops to $600.) But even if you didn’t get a 1099-K you still must report all the income that you made over third-party platforms in 2022.

1099-Rs for distributions over $10 that you received for a pension, annuity, retirement account, profit-sharing plan or insurance contract

SSA-1099 or SSA-1042S for Social Security benefits received.
“Be aware that there’s no form for some taxable income, like proceeds from renting out your vacation property, meaning you’re responsible for reporting it on your own,” according to the Illinois CPA Society.

One very last-minute way to reduce your 2022 tax bill: If you’re eligible to make a tax-deductible contribution to an IRA and haven’t done so for last year, you have until April 18 to contribute up to $6,000 ($7,000 if you’re 50 or older). That will reduce your tax bill and augment your retirement savings.

Proofread your return before submitting it: Do this whether you’re using tax software or working with a professional tax preparer.

Little mistakes and oversights delay the processing of your return (and the issuance of your refund if you’re owed one). You want to avoid things like having a typo in your name, birth date, Social Security number or direct deposit number; choosing the wrong filing status (e.g., married vs single); making a simple math error; or leaving a required field blank.

What to do if you can’t file by April 18: If you’re not able to file by next Tuesday, fill out Form 4868 electronically or on paper and send it in by April 18. You will be granted an automatic six-month extension to file.

Note, however, that an extension to file is not an extension to pay. You will be charged interest (currently running at 7%) and a penalty on any amount you still owe for 2022 but haven’t paid by April 18.

So if you suspect you still owe tax — perhaps you had some income outside of your job for which tax wasn’t withheld or you had a big capital gain last year — approximate how much more you owe and send that money to the IRS by Tuesday.

You can choose to do so by mail, attaching a check to your extension request form. Make sure your envelope is postmarked no later than April 18.

Or the more efficient route is pay what you owe electronically at IRS.gov, said CPA Damien Martin, a tax partner at EY. If you do that, the IRS notes you will not have to file a Form 4868. “The IRS will automatically process an extension of time to file,” the agency notes in its instructions.

If you opt to electronically pay directly from your bank account, which is free, select “extension” and then “tax year 2022” when given the option.

You can also pay by credit or debit card, but you will be charged a processing fee. Doing so, though, may become much more costly than just a fee if you charge your tax payment but don’t pay your credit card bill off in full every month, since you likely pay a high interest rate on outstanding balances.

If you still owe income taxes to your state, remember that you may need to go through a similar exercise of filing for an extension and making a payment to your state’s revenue department, Martin said.

Use this interactive tax assistant for basic questions you may have: The IRS provides an “interactive tax assistant” that can help you answer more than 50 basic questions pertaining to your individual circumstance on income, deductions, credits and other technical questions.
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April 13, 2023
EPA proposes new tailpipe rules that could push EVs to make up two-thirds of new car sales in US by 2032 | CNN Politics

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The Environmental Protection Agency on Wednesday proposed ambitious new car pollution rules that could require electric vehicles to account for up to two-thirds of new cars sold in the US by 2032, in what would be one of the Biden administration’s most aggressive climate-change policies yet.

The tailpipe standards would also have the effect of cutting planet-warming pollution from cars in half. Transportation accounts for nearly 30% of all greenhouse gas emissions in the US, according to the EPA.

EPA Administrator Michael Regan called the regulations “the strongest-ever federal pollution standards for cars and trucks.”

Regan touted the proposed rules on “CNN News Central” on Wednesday, claiming they would bring down costs for consumers and slash planet-warming pollution.

“This is a future for everyone, and we’re starting to see all of the auto industry move in this direction,” Regan told CNN’s Sara Sidner, saying strong auto emissions rules have been part of President Joe Biden’s “vision from day one.”

EPA officials said that they are considering several different emissions proposals, which could result in anywhere from a 64% to 69% electric vehicle adoption rate by early next decade. If approved, the emissions standards would start model year 2027 vehicles.

The agency anticipates the new rules would mean EVs could also make up nearly half of all new medium-duty vehicles, like delivery trucks, by model year 2032. Officials are also proposing stronger standards for heavy-duty vehicles, including dump trucks, public utility trucks, and transit and school buses.

One expert told CNN the Biden administration’s proposal is a pivotal moment for the US auto industry and consumers.

“It’s a pretty big deal,” said Thomas Boylan, a former Environmental Protection Agency official and the regulatory director for the EV trade group Zero Emission Transportation Association. “This is really going to set the tone for the rest of the decade and into the 2030s in terms of what this administration is looking for the auto industry to do when it comes to decarbonizing and ultimately electrifying.”

Regan and White House National Climate Adviser Ali Zaidi hailed the proposed regulations as a major climate win that would also save American consumers money in the coming years.

Zaidi said that in the Biden administration’s first few years, the number of EVs on US roads had already tripled, while the number of public charging stations had doubled. And Zaidi vowed more to come, with funding from Biden’s infrastructure law for a network of EV charging stations combined with consumer tax credits.

“Whether you measure today’s announcements by the dollars saved, the gallons reduced, or the pollution that will no longer be pumped into the air, this is a win for the American people,” Zaidi said.

Yet even as the administration is writing aggressive regulations to push the market toward EVs, a Gallup poll released Wednesday suggests that Americans are not yet sold on the idea. Gallup polled more than 1,000 adults in the US last month and found that 41% said they would not buy an electric vehicle.

Not only are EVs still more expensive than gas-powered cars, but consumers also haven’t yet grasped the climate benefits of transitioning to zero-emissions vehicles, the poll found. Six in 10 respondents said they believe EVs help the environment “only a little” or “not at all,” Gallup reported.

Transportation is the biggest source of planet-warming pollution in the US, and light duty vehicles – the average cars Americans drive – account for 58% of those emissions. The UN’s Intergovernmental Panel on Climate Change reported last year that aggressive, pollution-slashing changes in the global transportation sector – including the transition to EVs – could reduce the sector’s emissions by more than 80%.

Speaking on CNN, Regan also emphasized that switching to an EV would save consumers money in the long run.

“Folks who purchase electric vehicles will see a cost savings over the lifespan of the vehicle, because they’re not having to buy gas, having to pay for maintenance,” Regan said. “So this is a huge opportunity for everyone in this country.”

Other countries, including the EU and China, are moving faster toward adopting EVs. In the US, California has already proposed that zero-emissions vehicles make up 70% of new car sales by 2030, and 17 other states plan to follow California’s lead.

That means much of the US car industry will already be transitioning ahead of the proposed federal rules.

“I believe it’s pretty doable,” Margo Oge, chair of the International Council on Clean Transportation and a former Obama EPA official, said of the aggressive transition to EVs. “The industry is there. Europe is ahead of the US, China is ahead of Europe – and these companies are global companies.”

New federal tax credits are coming next week that aim to help American consumers save up to $7,500 on an EV. But they have incredibly complex requirements for the auto industry – including that the cars’ batteries and components come from the US or countries it has a free-trade agreement with.

Still, Boylan said the regulations are designed to gradually work over the next decade, by which time consumers should have far more electric vehicle options to choose from.

“You’ve got the tax credits as the carrot,” Boylan said. The proposed tailpipe regulation “provides the stick to backstop these incentives and push the industry forward.”

Regan told CNN the rules would be phased in gradually, giving auto makers and consumers years before they fully go into effect. During that time, the administration is focused on installing more EV charging stations and expanding access to $7,500 federal EV tax credits.

“What we’re looking at is a ramp-up period,” Regan said on CNN. “We’re going to see a massive buildup over the next couple years, and we’re starting to see those electric vehicle sales numbers grow already.”

The EPA will take public comment on the proposal before finalizing the rules in the coming months.

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April 12, 2023