Tax Refund

Still wrangling over the omnibus bill, senators offer a third-party-payment amendment. Majority Leader Chuck Schumer hopes the Senate will pass the $1.7 trillion bill quickly. However, the Senate may have to deal with several amendments including one from Sens. Joe Manchin and Bill Hagerty to boost the reporting threshold for Form 1099-Ks. Now, transfers using third-party payment networks like Venmo that exceed $600 must be reported to the IRS.  The amendment would raise the threshold to $10,000 for the 2022 tax year.

Should Congress extend bonus depreciation? TPC’s Thomas Brody reviews data from the latest TPC analysis. It shows continuing the special deduction would reduce federal revenues by $250 billion over the next decade. It would benefit some corporations more than others, and subsidize a portion of investment that would happen anyway. It’s less clear how much it will benefit the overall economy.

New tax cuts will reduce tax refunds in Colorado, forecasters say. State economists expect two tax measures approved by voters in November will cut into otherwise mandated refunds available through Colorado’s Taxpayer Bill of Rights. TABOR requires refunds when tax revenue exceeds a certain amount. Even though the initiatives reduce revenue by more than  $2 billion this fiscal year, overall revenue still is expected to exceed the TABOR cap by billions of dollars. State officials warn inflation poses a bigger threat to the budget.

There won’t be a flat tax in Wisconsin anytime soon. Democratic Gov. Tony Evers promises to veto any flat-income tax plan passed by the Republican-controlled legislature. He’d rather see a 10 percent middle-class tax cut. Republican lawmakers want to flatten the state’s income tax, starting with the elimination of the state’s highest tax bracket.

Bad tax ideas? There are at least ten. TPC’s Howard Gleckman announced the annual Lump of Coal Awards for the year’s worst tax ideas. They include rapping about fraud in a video, exempting some income earned through crypto, or opening an election season by vowing to raise taxes on half the country’s households. Which was the worst? 


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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