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Jun 1, 2022
Financial planners often warn clients against trying to time the market. It is impossible to guess exactly when sentiment on Wall Street will reverse course and even professionals get it wrong often.
Yet that is essentially what countless taxpayers are forced to do these days — playing chicken with a volatile market roiled by inflation, the war in Ukraine, and supply chain disruption.
For some taxpayers, it is a question of meeting expenses for survival of their businesses and personal lives. For others such as retirees, they are mandated by Internal Revenue Service rules to take required minimum distributions their individual retirement accounts or 401(k)s. The thought of pulling funds out during a bearish market is unpalatable enough to prompt some to tighten their belts until the market rebounds — or until Congress intervenes.
With a suddenly diminished nest egg and rising costs, many taxpayer's are will soon also have to contend with the third surprise: income taxes (and potential early withdrawal penalties) on their distributions.
During the pandemic, Congress suspended required minimum distributions to preserve capital in the market and help taxpayers from the triple-bite of investment losses, higher costs, and taxes owed. So far, there have not been any talks or proposals for exemption in 2022.
June 6, 2022
The Treasure Inspector General for Tax Administration (TIGTA), which oversees the Internal Revenue Service, unveiled a shocking revelation today.
During September 2021 and May 2022, the IRS destroyed an estimated 30 million paper-filed information returns in March 2021, reportedly, in part, to relieve a backlog of paper documents. The report gives little detail about the returns destroyed.
The IRS also claims “[t]here were no negative taxpayer consequences as a result of this action,” and taxpayers will not be subject to penalties resulting from the IRS’s actions.
However, as many public accounting industry experts described it, it is a “slap in the face to taxpayers who properly filed.”
May 10, 2022
The European Union has decided to remove the island nations of Seychelles, Anguilla, and Dominica from its official blacklist of tax havens, despite the islands being named as one of the main destinations for offshore companies in the Pandora Papers, a massive trove of leaked data exposing the secret dealings of the wealthy elites.
The decision on Tuesday comes as economic and finance ministers from EU countries gathered for a two-day meeting to discuss the economic recovery, soaring energy prices and the recent uptick in inflation. The EU updates its list of tax havens twice a year.
The Organisation for Economic Co-operation and Development (OECD) ruled the three archipelagos were entitled to an additional review to assess their compliance with international standards on tax transparency and exchange of information.