Taxes

It’s April and springtime, which means that it’s the final countdown to Tax Day on April 17. For those who haven’t yet filed their 2011 taxes, I offer one more item for your consideration prior to the April 17 deadline. And even those families who have already filed their tax returns for the last tax year (and hopefully claimed tax credits for which they were eligible) shouldn’t stop reading here.

April 17 isn’t just the deadline for filing your 2011 tax return without an extension. It’s the deadline for filing past tax returns – specifically, for the nearly one million individuals and families who failed to file a 2008 tax return. Why bother after three years? Well, the IRS estimates that nearly $1 billion in refunds has been just sitting in the vaults, so to speak, and that over half of those who failed to file a 2008 return may be entitled to a refund of over $600. Read more »

You've heard of slash and burn, but how about slash and burden?

On Thursday, the House is expected to vote on a budget for Fiscal Year 2013 introduced by Rep. Paul Ryan (R-WI). The Ryan budget would devastate vital services for women and their families while giving trillions in new tax cuts to the wealthiest Americans and large corporations — on top of extending provisions of the Bush-era tax cuts that benefit only the very wealthy.

Let's make it clear that we will not stand for a budget that slashes programs for women and families and puts the burden of paying for tax breaks for millionaires and corporations on middle- and low-income Americans.

Tell your Representative to oppose the Ryan Budget. As your Members of Congress start budget negotiations, they need to know that their constituents expect them to protect programs for women and families — and to require the wealthy and corporations to pay their fair share of taxes.

What's wrong with Rep. Paul Ryan's Budget? For starters, it would:

• Repeal the Affordable Care Act (ACA). Insurance companies could continue to charge women higher premiums than men, deny coverage to women due to preexisting condition, and refuse to cover maternity care.

While Washington begins debate on an FY 2013 budget proposal that would slash federal safety net programs (and everything else), some states facing projected budget shortfalls in FY 2013 have already proposed draconian cuts of their own. Alabama is one of those states, and as Greg Kaufman recently reported in The Nation, the steps Alabama’s legislature takes over the next few months to close its FY 2013 budget gap could be disastrous for struggling women and their families.

For example, at a hearing late last month, a state legislator with a lead role in budget drafting suggested that a 25 percent cut to general fund revenues flowing to the state’s Department of Human Resources (DHR) is likely next year. That’s a huge cut – so huge that the Commissioner of DHR, Nancy Buckner, testified that she would be forced to entirely eliminate the state’s Temporary Assistance for Needy Families (TANF) and child support enforcement programs.

Shutting down these programs would be devastating for vulnerable families in Alabama. Read more »

Last week, the President released a framework for business tax reform. The framework aims to simplify the tax code, eliminate dozens of tax loopholes and subsidies, and promote job creation in the U.S. The framework also includes a minimum tax for multinational companies so they can no longer avoid paying taxes by shifting jobs and profits overseas.  These are all important goals that have the potential to help our slowly-recovering economy, where millions of women and men are still struggling to get back on their feet. The framework also lowers the corporate rate from 35 to 28 percent, makes the research and experimentation credit permanent, and provides additional incentives for advanced manufacturing.

Although the President doesn’t specify the details of the necessary offsets, the framework is meant to be revenue-neutral, meaning that the tax reform would pay for itself. It wouldn’t reduce the funds flowing to the federal government — but it also wouldn’t raise any new revenue. At a time when Congress is obsessed with trying to balance our books, revenue-neutral isn’t enough. Budget deals have already scheduled $2 trillion in cuts over the next decade that will affect federal programs important to everyday Americans. Vital programs that women and their families depend on to protect their health, get quality child care, attend college, and meet their basic needs during difficult times and as they age need to be protected. Read more »

If you’re married, you’re probably planning to file your taxes jointly; most couples do. You should know that spouses filing a joint return are generally each liable for all of the tax owed on that return—but the law provides equitable relief when one of the spouses has no control over, or perhaps no knowledge of, how the household’s financial situation is reported. This “innocent spouse” relief is especially important for women: 90 percent of those who request relief from joint liability are women, 65 percent of those who request relief make less than $30,000 a year, and some are survivors of domestic violence.  

Section 6015(f) of the Internal Revenue Code provides that equitable relief is available for innocent spouses, but the determination rests on a “facts and circumstances” test.  

The Department of the Treasury recently proposed updating, clarifying, and expanding IRS guidelines for granting equitable relief. The proposed guidelines are beneficial to low-income women in general and to survivors of domestic violence in particular. Read more »

You may have already received your W-2 in the mail from your employer, which means (drum roll please!) the 2012 tax filing season is officially underway. In the spirit of the season, so to speak, the IRS is kicking things off with EITC Awareness Day. In case you aren’t familiar with the EITC, aka the Earned Income Tax Credit, it is a refundable federal tax credit for working families that can be worth up to $5,751 for tax year 2011 (the year for which you’ll be filing your taxes now, in 2012). Along with the federal Child Tax Credit (a refundable credit worth up to $1,000 per child) and the Child and Dependent Care Tax Credit (a nonrefundable credit that helps families with child and dependent care costs incurred in order to work or look for work), as well as analogous state tax credits, the EITC can provide working families a significant financial boost.  And in these tough economic times, families need all the help they can get. Read more »

I’m very happy to report that millions of jobless workers and their families can rest a little easier over the holidays. Last night, House Republican leadership agreed to move forward with a two-month extension of federal emergency unemployment insurance (UI) and other measures, like the payroll tax cut, that were set to expire December 31. This morning, Congress approved a slightly modified version of the extension that the Senate passed 89-10 last Saturday, ending the standoff that began when House Speaker John Boehner (R-OH) announced Sunday that the House intended to reject the Senate bill. President Obama is expected to sign the bill shortly.    Read more »

Neither the approaching holidays nor data showing a bleak jobs picture seems to have mellowed House Republican leaders. The payroll tax-unemployment insurance-“doc fix” bill (H.R. 3630), introduced by Rep. Dave Camp (R-MI), which the House is expected to vote on today, has already drawn a veto threat from President Obama because of a provision on the Keystone oil pipeline. But there are many other reasons to be deeply concerned about this bill. Read more »

The White House just issued a statement declaring President Obama’s intention to veto H.R. 3630. It’s short and to the point and posted in full below; if you want more details about the flaws in the bill, you can read our posts about it.

STATEMENT OF ADMINISTRATION POLICY

H.R. 3630 – Middle Class Tax Cut Act of 2011 (Rep. Camp, R-Michigan, and 5 others)

The Administration strongly opposes H.R. 3630. With only days left before taxes go up for 160 million hardworking Americans, H.R. 3630 plays politics at the expense of middle-class families. H.R. 3630 breaks the bipartisan agreement on spending cuts that was reached just a few months ago and would inevitably lead to pressure to cut investments in areas like education and clean energy. Furthermore, H.R. 3630 seeks to put the burden of paying for the bill on working families, while giving a free pass to the wealthiest and to big corporations by protecting their loopholes and subsidies.

Read more »

With continued high unemployment causing increased numbers of women to lose health insurance coverage, policy makers should be trying to help people afford insurance.  They should ensure that someone doesn’t have to stop medical treatment because she lost her job.  They shouldn’t make it more difficult to access health coverage – but that is just what H.R. 3630 (introduced by Rep. Dave Camp, R-MI), a bill up for a vote in the House today, does. 

Reduce Financial Protections for Low- and Moderate-Income Americans who Receive Tax Credits under the Affordable Care Act

In 2014, the Affordable Care Act will provide tax credits to help individuals and families purchase coverage through a health insurance exchange.  Advance payments of the tax credits to help pay for insurance premiums (“premium tax credits”) will be paid directly to the insurance company based on information on household size and income provided to the insurance exchange.  Credits will be available on a sliding scale to help people with household income under 400 percent of the federal poverty level (about $88,000 for a family of four in 2011).

Actual income will often be different than income projected when a family enrolls in coverage.  People get married or divorced.  People lose jobs or get new jobs.  Some people work fewer hours than they expected.  Other people get promotions or bonuses.  Sometimes an unexpected cost arises – perhaps a large medical bill – that requires a person to take a second job.  Read more »