Federal Income Tax Research Articles

A Framework for Income, Inheritance, and Wealth Tax in America amid Increasing Income Inequality when the Richest are Leaving even the Rich Far Behind

A Framework for Income, Inheritance, and Wealth Tax in America amid Increasing Income Inequality when the Richest are Leaving even the Rich Far Behind

Summaries of Articles

Summaries of Articles

The Oregon Earned Income Credit’s Impact on Child Poverty

ABSTRACT Building off the success of the federal earned income tax credit (EITC), states have developed earned income credits to supplement the incomes of the working poor. In 2016, a distinctive change to the Oregon Earned Income Credit (OEIC) targeted additional resources to families with young children. Using a unique data set and static estimates, we found that the OEIC yielded proportional decreases in child and young child poverty of 1.8 and 2.6%, respectively. By simulating alternative OEIC policies, we also found that significant increases to OEIC rates or takeup would be required to more aggressively reduce child poverty.

ИННОВАЦИОННЫЕ ФИНАНСОВЫЕ ТЕХНОЛОГИИ РАЗВИТИЯ ЭКОНОМИКИ РОССИИ

The proposed innovative financial technologies for the development of the Russian economy, harmoniously combining the interests of working citizens, owners and the state, make it possible, at quite achievable growth rates of gross domestic product (enterprise revenue) by 3% per year, to ensure a 48% increase in wages of working citizens over 10 years, which will practically end poverty. Increase contributions to the development fund from one employee by 1,843.07 rubles. On average, for a workforce of 100 people, 2,211,684 rubles will be allocated for development per year, with a number of 1,000 people, 22,116,840 rubles will be received, in which, first of all, the owners of enterprises and the entire workforce are interested, since this ensures the growth of their incomes and the possibility of constant modernization and updating of technological equipment and production new competitive products. First, to stabilize, and starting in 2028 to increase contributions to the Pension Fund of Russia and the Federal Compulsory Medical Insurance Fund and income tax, income tax and value added tax receipts and bring this growth to 2.5% by 2030, which will allow the state to solve many social problems. To reduce contributions to the Pension Fund of Russia by 2030 by 13.01% to 8.99% and the Federal Compulsory Medical Insurance Fund by 5.1% to 0%, which will significantly reduce the cost of goods, works and services of all Russian enterprises. When switching to the innovative financial technologies proposed in the article, almost 4 trillion steering wheels will accumulate on the pension and medical accounts of Russian citizens in the first year of implementation. And by 2026, 74 trillion rubles. Providing citizens with 2% per annum, banks will be able to lend to enterprises at 2.5% with a 25% margin, providing the Russian economy with huge, long-term and cheap financial resources.

ИННОВАЦИОННЫЕ ФИНАНСОВЫЕ ТЕХНОЛОГИИ РАЗВИТИЯ РУДНИКА «СЕВЕРНЫЙ» АО «ЭЛЬКОНСКИЙ ГОРНО-МЕТАЛЛУРГИЧЕСКИЙ КОМБИНАТ»

The proposed innovative financial technologies for the development of the Severny mine of the Elkonsky Mining and Metallurgical Combine, harmoniously combining the interests of working citizens, owners and the state, make it possible, at quite achievable growth rates of gross domestic product (enterprise revenue), to ensure a 4.08-fold increase in wages of employees over 5 years, to increase contributions to the development fund over 5 years in 16.32 times, in which, first of all, the owners of enterprises and the entire workforce are interested, because this ensures the growth of their income and the possibility of constant modernization and updating of technological equipment and the release of new competitive products. In addition, deductions to the Pension Fund of Russia and the Federal Compulsory Medical Insurance Fund and income tax, income tax and value added tax over 5 years will increase by 4.26 times, which will allow the territorial authorities to solve many social problems.

НАЛОГОВЫЕ ВЫЧЕТЫ ПО НАЛОГУ НА ДОХОДЫ ФИЗИЧЕСКИХ ЛИЦ

The subject of the study is the study of tax deductions for personal income tax (personal income tax). It is noted that the federal personal income tax under consideration represents the withdrawal of part of citizens’ income to the budget system of the Russian Federation. The researchers found that the total amount of personal income tax receipts is affected by the amount of tax deductions. It is proposed to tighten administrative measures on personal income tax evasion. This applies primarily to employers who violate the norms of labor legislation. The authors propose to introduce a tax-free minimum for working citizens, as well as to revise the tax legislation in terms of time limits when providing social tax deductions for education.

ИННОВАЦИОННЫЕ ФИНАНСОВЫЕ ТЕХНОЛОГИИ РОСТА ЗАРАБОТНОЙ ПЛАТЫ И ОТЧИСЛЕНИЙ НА РАЗВИТИЕ РУДНИКА «СЕВЕРНЫЙ» АО «ЭЛЬКОНСКИЙ ГОРНО-МЕТАЛЛУРГИЧЕСКИЙ КОМБИНАТ»

The proposed innovative financial technologies for the development of the Severny mine of the Elkonsky Mining and Metallurgical Combine, harmoniously combining the interests of working citizens, owners and the state, make it possible, at quite achievable growth rates of gross domestic product (enterprise revenue), to ensure a 3.86-fold increase in wages of employees over 5 years, to increase contributions to the development fund over 5 years in 10.58 times, in which, first of all, the owners of enterprises and the entire workforce are interested, because this ensures the growth of their income and the possibility of constant modernization and updating of technological equipment and the release of new competitive products. Increase contributions to the Pension Fund of Russia and the Federal Compulsory Medical Insurance Fund and income tax, tax on profit and value added tax for 5 years by 4.26 times, which will allow territorial authorities to solve many social problems.

Course Overview Note: Implementing Urban Economic Development

This course described in this note provides a guide to implementing urban economic development at the local and regional level. This course is based on the assumption that, effective implementation of urban and regional economic development requires an entrepreneurial approach. Development is entrepreneurial in the sense that, from the point of view of an urban official, most of the big picture policy levers will probably be set exogenously. (For example, Federal income tax rates, immigration policy, and much else are set by the US Government, and a local official has little room to directly change these policies.) So, a local economic development official must understand the goals of the community and its overall economic environment, and imaginatively use the available tools to create public value. Among the issues commonly facing urban development professionals are: persistent racial inequality, rising income inequality, climate change, hollowing out of middle class jobs, and so on. Hence, the course’s focus is on tools available to state and city leaders (without dramatic changes in legislation) to drive economic development at the regional and urban levels. Finally, this is a case study course on the implementation of policy – it’s not a course on urban economic theory, nor is it a course on what Federal policy should be towards urban areas – though to some extent both of these topics are touched on. At Princeton, this is taught as a semester long graduate course of twenty-four 80 minute sessions. If you are a faculty member and would like a copy of the full syllabus for the current version of this course, please e-mail me from your university account.

A Man for His Era and for Ours: Cordell Hull, Father of the Federal Income Tax

A Man for His Era and for Ours: Cordell Hull, Father of the Federal Income Tax

Free Agency, Hard Work, and the Justification of Economic Inequality in the Church of Jesus Christ of Latter-day Saints

Free Agency, Hard Work, and the Justification of Economic Inequality in the Church of Jesus Christ of Latter-day Saints

Consider your origins: Parental social class and preferences for redistribution in the United States from 1977 to 2018

Capitalizing on the newly available and consistent coding of detailed occupations for the General Social Surveys (GSS), this article examines the link between class origins and public support for redistribution in the United States from 1977 through 2018. The findings reveal significant net associations between class origins and preferences for redistribution. Individuals with farming-class or working-class origins are more supportive of government action to reduce inequality than individuals with salariat-class origins. These class-origin differences are associated with individuals’ current socioeconomic characteristics but are not fully accounted for by these factors. In addition, individuals in more privileged class positions have increased their support for redistribution over time. Attitudes toward federal income taxes are also analyzed as an additional measure of redistribution preferences. Overall, the findings suggest a continuing role of class origin in determining support for redistribution.

The geography of US homeownership tax expenditures

US homeowners receive income tax deductions for mortgage interest payments and state and local property taxes, pay no income tax on their home's imputed rental income, and may exclude most of the capital gains earned from a home sale. This paper characterizes the geographic distribution of the tax expenditures from these tax preferences using a new method that exploits household-level microdata from the 2019 Census Public Use Microdata Sample to simulate homeownership tax expenditures at the Public Use Microdata Area level. I estimate that in the 2018 tax year, $226.05 billion in taxable revenue was lost to the mortgage interest deduction ($28.20 billion), the property tax deduction ($9.51 billion), the exclusion of net imputed rental income ($134.82 billion), and the partial exclusion of housing-related capital gains ($53.52 billion). Large metropolitan areas and neighborhoods with high housing prices receive subsidies in excess of the cost of funding homeowner tax preferences, while the burden of homeowner tax preferences falls heavily on rural areas. If federal income tax law reverted to what existed just prior to the 2017 Tax Cuts and Jobs Act, these geographic disparities would be exacerbated.

November 2022 Placement Ads

November 2022 Placement Ads

Federal Taxation: Comprehensive Topics

Federal Taxation: Comprehensive Topics

THE PARALLEL MARCH OF THE GINIS How does taxation relate to inequality, and what can be done about it?

THE PARALLEL MARCH OF THE GINIS How does taxation relate to inequality, and what can be done about it?

Using Unrelated IRS Guidance as a Framework for Taxing Crypto Transactions: Revenue Procedure 2019-18

ABSTRACT The cryptocurrency market has become one of the fastest growing industries in the world, with a market capitalization exceeding $2 trillion. This rapid growth has caused strains on financial systems, as well as the Internal Revenue Service. With cryptocurrency technology developing faster by the week, a unified and simplified regulatory approach is the sensible roadmap for the Internal Revenue Service in its task to impose federal income tax. This paper proposes that by researching prior IRS guidance on unrelated issues and using preexisting precedent, specifically, Revenue Procedure 2019-18, the Internal Revenue Service can more simply impose federal income taxes on the ever-changing cryptocurrency space. JEL Classifications: K23; K29; K34.

Placing U.S. Federal Housing Policy on a Secure Foundation: The SHELTER Plan

Problem, research strategy, and findings U.S. housing advocates have called for a fundamental rethinking of the nation’s federal housing policies. In this study, I examined the geographic and household-level consequences of a plan that redistributes federal income tax expenditures from homeowners to very-low-income households. I propose, defend, and illustrate the effects of the SHELTER plan, a redistributive policy that a) is revenue neutral, b) is tenure neutral, c) is progressive, d) prioritizes local redistribution, and e) targets excess revenues to affordable housing production subsidies in communities where an increase in cash-based housing assistance is most likely to inflate housing rents. I demonstrate that the savings from the elimination of four homeownership tax expenditures would provide more than enough revenue to fund a universal housing allowance for all very-low-income households. Ignoring housing market adjustments, the plan would reduce housing cost burdens for the nation’s very-low-income renters by 36% and reduce very-low-income homeowners’ cost burdens by 28%. Takeaway for practice The SHELTER plan would provide a new foundation for local affordable housing and community development practice. Very-low-income households would receive a guaranteed housing allowance with no strings attached and local planners would have new roles in the design and implementation of localized solutions to the affordable housing crisis.

Current Topics in Health Care Law

Current Topics in Health Care Law

A Primer on the Income Tax Consequences of the NCAA’s Name, Image and Likeness (NIL) Earnings for College Athletes

NCAA domestic college athletes can now financially benefit from their name, image, and likeness (NIL). The purpose of this article is to “educate” athletes on the new NIL rules in financial literacy. With new NIL income flowing to athletes, federal income tax consequences of these transactions must be addressed. This article results in a detailed introduction to the applicable federal tax rules regarding NIL income for athletes to stay in compliance with those laws. From understanding NIL income, to how the tax formula works, what tax forms apply, and what taxes may be due, this article provides a comprehensive toolkit for athletes who will be financially benefitting from NIL. Athletes must learn to understand the tax rules associated with the income from the NIL. In general, most athletes earning equal to or less than $12,550 in NIL income should have no federal income tax due. However, athletes likely must fill out tax returns, and as self-employed taxpayers, may owe self-employment taxes. Most athletes have spent many hours weekly and yearly mastering the sport and more than likely not as much time holding jobs. As such, there is a lack of basic understanding of the United States’ income tax system.

The Confusing World of Cryptocurrency and Tax Compliance Issues

Subtitle A, of the Internal Revenue Code (IRC), contains regulatory provisions regarding the federal taxes imposed on the income of both individuals and corporations. The IRC guidance is intended to provide a determination of all income that must be reported on tax returns and potentially could become subject to an income tax. A new form of currency, known as cryptocurrency appeared on mainstream trading platforms beginning in 2009. Bitcoin initially was the most widely recognized digital currency but other virtual currency versions soon followed. Initially, taxpayers mistakenly believed that cryptocurrency transactions were not subject to Subtitle A of the IRC. Therefore, crypto transactions were assumed to be non-taxable and non-reportable for tax purposes. However, within a few years of the introduction of Bitcoin into the US economic system, the Internal Revenue Service (IRS) introduced tax guidance pertaining to cryptocurrency transactions. In 2014, the IRS responded with Notice 2014-21 as the popularity of Bitcoin grew exponentially. The IRC guidance stated that cryptocurrency must be treated as property for federal tax purposes. The tax implication of the IRS guidance was that cryptocurrency transactions would result in either a gain or loss for tax purposes on Schedule D. This guidance resulted in a recognition that all cryptocurrency transactions would be subject to federal income tax.