Child Tax Credit, AI Tax Incentives, and Electric Vehicle Rebate Programs
Probity Tax Recovery is a tax consulting firm specializing in tax credits and incentives for small to mid-sized businesses. We work with business owners and their CPAs to identify tax credits and incentives while saving you time and money. Schedule a free consultation with a member of our team here.
FINCEN FILING: Beginning this year, most small companies have a NEW small business filing requirement with FinCEN call the Business Ownership Information Report, that can be time confusing. Failure to file or erroneous filings can result in jail time and up to $10,000 in fines. Our team can handle the filing for you with minimal effort on your end. To get started, schedule a time to speak with us here.
Tax Policy/News:
August 1: Senate Republicans Block $78B Business, Child Tax Break Package
Senate Republicans have blocked a $78 billion package that included extensions for business tax breaks and child tax credits.
The bill sought to renew various expired tax provisions, such as those benefiting renewable energy, research and development, and the expanded Child Tax Credit, which provided significant relief during the pandemic.
Opponents argued the package would increase federal deficits and discourage work.
Supporters stressed its importance for economic support and reducing child poverty.
The impasse highlights ongoing partisan disagreements over fiscal policy and social welfare programs.
July 31: IRS Adds Changes to Tax Filings, Reporting Standards on Cryptocurrency
The IRS has introduced new changes to tax filing and reporting standards for cryptocurrency, aiming to improve compliance and clarity for taxpayers dealing with digital assets.
These updates include revised definitions of what constitutes a reportable transaction and expanded requirements for reporting cryptocurrency holdings and activities.
The agency's guidelines now mandate that taxpayers disclose their cryptocurrency transactions more comprehensively, including transfers and sales. Additionally, the IRS has enhanced its efforts to identify and address non-compliance in the rapidly growing cryptocurrency market, utilizing advanced data analytics and enforcement strategies.
These changes reflect the increasing focus on cryptocurrency as a significant area for tax administration and enforcement, highlighting the need for taxpayers to stay informed about their obligations.
The updated standards are expected to impact both individual investors and businesses involved in digital asset transactions.
July 30: Improvements Needed for Local Taxpayer Advocate Service Telephone Lines
The Treasury Inspector General for Tax Administration (TIGTA) found significant issues with local Taxpayer Advocate Service (TAS) telephone lines, including some lines not being in service and others having full voicemail boxes, preventing taxpayers from leaving messages.
Test calls to 76 lines revealed inconsistencies in recorded messages and callback times, ranging from one business day to four weeks.
Additionally, discrepancies were noted between contact information on the TAS and IRS websites. TIGTA recommended improvements in telephone monitoring and messaging consistency, which TAS management has partially implemented, citing staffing limitations.
Despite some corrective actions, challenges remain in ensuring reliable taxpayer access to TAS assistance.
Economic News/Policy:
August 6: Kamala Harris's Tax Policy Positions Begin to Take Shape
Vice President Kamala Harris is starting to outline her tax policy positions, which include a focus on increasing taxes for high-income individuals and corporations while providing relief to middle- and low-income families.
Harris has signaled support for rolling back parts of the 2017 Tax Cuts and Jobs Act, which she argues disproportionately benefited the wealthy and large businesses.
Additionally, she advocates for expanding the Earned Income Tax Credit and Child Tax Credit to reduce poverty and support working families.
Harris's proposals also emphasize closing tax loopholes and enhancing enforcement to ensure compliance among high earners and corporations.
These emerging tax policy stances reflect the administration's broader goals of addressing income inequality and funding social programs. As her positions become clearer, they will likely shape the upcoming legislative agenda and fiscal debates in Congress.
August 1: Senate Appropriations Committee Advances Key Spending Bills
The Senate Appropriations Committee has advanced a series of crucial spending bills, signaling progress in the federal budget process ahead of the fiscal year deadline.
These bills, which cover funding for various government departments and programs, are part of a broader effort to avoid a government shutdown and ensure continued operation of federal services.
Among the measures approved are significant allocations for defense, health, and education, reflecting bipartisan negotiations and compromises.
The advancement of these bills demonstrates a functional legislative process amid ongoing partisan divisions, particularly concerning overall spending levels and priorities.
The committee's actions now set the stage for full Senate consideration, where further debates and potential amendments are expected. Successful passage of these appropriations is critical to maintaining government functions and addressing key policy areas, including national security, public health, and education funding.
Technology:
July 25: Gov. Murphy Signs AI Tax Incentives into Law
New Jersey Governor Phil Murphy has signed a new law providing tax incentives aimed at fostering the growth of artificial intelligence (AI) industries within the state.
The legislation offers tax credits and other financial benefits to companies investing in AI research, development, and implementation.
This initiative is part of a broader strategy to position New Jersey as a leader in AI technology and innovation, potentially attracting high-tech firms and boosting the state's economy.
Supporters of the law believe it will create high-paying jobs and stimulate economic development, while critics caution about the potential costs and the effectiveness of such incentives.
The law also includes provisions for workforce development programs to ensure that local talent is prepared to meet the demands of the AI sector. This move underscores the growing importance of AI in economic policy and its potential impact on various industries and employment.
Energy and Environmental Policy/News:
August 5: Washington State Opens First-of-Its-Kind Electric Vehicle Rebate Program
Washington State has introduced an innovative Electric Vehicle (EV) Instant Rebate Program, offering up to $9,000 off new EV leases for low-income drivers, significantly lowering their monthly payments to below $200.
The program targets residents earning up to 300% of the federal poverty level and provides substantial rebates for both new and used EV purchases and leases.
Aimed at making EVs more accessible and reducing pollution, the initiative supports the state's transportation electrification strategy and is funded with $45 million.
It also complements existing federal tax credits and incentives, enhancing overall affordability for eligible drivers.
For Fun:
August 1: Gene-Editing Trees Could Revolutionize Paper Production
The paper production industry could undergo significant transformation through gene-editing technology, which promises to make trees more suitable for manufacturing.
Current methods of paper production involve extensive chemical processes to break down wood into pulp, which is both costly and environmentally harmful.
By using gene-editing techniques like CRISPR, scientists can alter the composition of tree lignin, the complex polymer that makes up much of the wood's structure. Reducing lignin content or modifying its properties can make trees easier to process, reducing the need for harsh chemicals and lowering production costs.
Additionally, these genetically modified trees could grow faster and be more resilient to pests and diseases. The development holds promise not only for more sustainable paper production but also for advancing bioproducts and biofuels, contributing to broader environmental and economic benefits.