WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’ - TUESDAY EDITION

* My memory of “My First 1040” appears in the current issue of the newsletter of the PA chapter of NATP.  Click here to read.

* Be sure to check out Kay Bell’s “Tax Carnival #117: Summer Tax Time” at DON’T MESS WITH TAXES.

Included in the Carnival – “Robert D Flach shares a couple of ‘True Tax Time Tales - IRA Withdrawals’.”

* Howard Gleckman states the obvious at FORBES.COM – “Who Benefits From Loopholes And Special Interest Tax Breaks? You Do”.

* Also over at FORBES.COM Peter J Reilly attacks the controversy surrounding the NFL’s tax-exempt status and finds “NFL As Tax Exempt Less Than Meets The Eye?”.

Did the NFL’s tax exempt status cause it to avoid paying taxes?  Apparently not, because it loses money.  Actually, as Peter points out –

“If you view the NFL in conjunctions with its member teams, it appears that it has the effect of increasing aggregate taxable income.”

As Peter ends the piece –

“So what is everybody so upset about?  Maybe somebody will explain it to me.”

* Richard Rubin of BLOOMBERG.COM reports that “High-Income, No-Tax Returns Dropped 8% in 2010, IRS Says” -

“The number of U.S. households that reported adjusted gross income over $200,000 and paid no income taxes declined by 8 percent in 2010, according to Internal Revenue Service data.”  

That is good news. 

Why do these “high income” individuals pay no tax –

“Such taxpayers typically use multiple tax breaks to eliminate their U.S. tax liability, including deductible charitable contributions and medical expenses, the report said.”

And, interestingly –

“These taxpayers also didn’t pay the alternative minimum tax, which was designed to prevent high-income households from legally escaping taxes.”

So the dreaded AMT does not do what it was created to do (and hasn’t since 1986).  All it does is unfairly increase the taxes of the middle and upper-middle class, especially those in highly taxed states.

More good news in the report -

“According to the report, among households with incomes under $50,000, 55 million, or 59 percent, didn’t pay U.S. income taxes. Non-payers made up 41 percent of all households.”

So the infamous “47%” is now 41%.  That is still too many.

* At REAL CLEAR POLITICS Lawrence Kudlow correctly explains that “Tax Reform Is the IRS Fix”.

“The institutional corruption of the IRS has been enabled and encouraged by one of the craziest tax codes in the world. Tax reform can solve this. Now is the time.”

 

TTFN