Tax Refund


Bipartisan tax plan for Taiwanese companies in the US. Lawmakers released a compromise plan that would eliminate double taxation for Taiwanese-based companies due to the US’s lack of a tax treaty with Taiwan. The House Ways & Means Committee is scheduled to vote on the plan on Thursday. In a joint statement, the heads of the Senate Finance and Foreign Relations Committees called the plan “a long overdue step to strengthen the important relations between the U.S. and Taiwan.”

The Biden Administration released EV tax credit rules for foreign entities. They specify which foreign entities of concern (FEOC) are not eligible for electric vehicle (EV) tax credits under the Inflation Reduction Act (IRA). The IRA established a $6 billion battery manufacturing and grant program and a tax credit for the purchase of electric vehicles. The rules released late last week would restrict eligibility of battery containing either components or critical minerals from a FEOC, with exceptions for certain trace minerals sourced from China.

Can your income be taxed before you receive it? TPC’s Steve Rosenthal explains why the answer is usually not, but sometimes yes. The US Supreme Court will hear arguments this week in Moore vs the United States, the case that will decide whether Congress maintains that authority. He argues that “Congress must maintain its broad authority to ‘lay and collect‘ taxes including, sometimes, on unrealized income. Only Congress, with its resources, expertise, and experience, can create tax rules for sophisticated international and capital markets that properly balance revenue demands, administrative convenience, and fairness.” 

No tax windfall in California. The state’s tax revenue collections will fall $58 billion short of expectations for the current and upcoming fiscal year, according to the California Legislative Analyst’s Office. The state could be forced to use its rainy day fund or cut some services. California currently has about $37 billion in its reserves.

 

For the latest tax news, subscribe to the Tax Policy Center’s Daily Deduction. Sign up here to have it delivered to your inbox weekdays at 8:00 am (Mondays only when Congress is in recess). We welcome tips on new research or other news. Email Renu Zaretsky at [email protected].

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