Matt Smith

This article hits the nail on the head. Groups like ATR seem to love blabbing about how they want to be able to drown government in a bathtub while lobbying to drown Americans in tax complexity instead.

@natesosa_CPA @ForemanTaxLaw Didn’t your post allude to the need of under 7 days AND material participation?

1. Sure my presentation isn’t perfect, Was more meant to be a conversation that maybe just doing things for taxes without a legit business plan isn’t wise 2. I’m aware this is falls under one of the exceptions under 1.469-1T(e)(3)(ii) and avoids having to be considered a rental activity and therefore doesn’t force the owner have to hit 750 hours/50% requirement 3. I do too! 4. You do great content and I appreciate your work!

People do the strangest things for taxes Client: I'm going to take this RV Park, and force everyone to stay less than 7 days so I can get tax write-offs Me: oh interesting strategy, is their a market for that? Client: Oh I have no idea, but I want to write off the RVs I've got on there Me: But, is it gonna make money Client: I think so Me: That's not really a business strategy... Client: I just care about taxes man, just let me deduct it Me: What kind of town is it Client: College Town Me: Oh so maybe the less than 7 days work. Big sports college town? Client: Gainesville, so maybe Me: Oh okay, I think we're cooking now. Get parents and fans in there, that's pretty southern actually Client: So Bonus depreciation? Me: Actually yes, as long as you think you keep up with your debt service and costs, you should be able to make it happen. Wait are you managing it? Client: Was gonna get an ops guy Me: MMMM if you want those tax benefits, you should probably be involved, which is gonna be a lot Client: Btw, I can do a 1031 with this right? Me: Hmmm what are you owning, the pads, or the RVs? Or both? Client: Both actually Me: Well, some of it will be, and some of it won't be Client: Man. Maybe this isn't as good as taxes as I thought Me: I think the better question is: After tax savings, will you still make money on this?

@ForemanTaxLaw Yeah, that's pretty black and white in the statute. What AI platform?

@SmithMatthewC Greater of $10 million or 10x basis. He somehow got an answer that it was lesser of. Showed me the "research" too!

Just had a CPA argue with me by saying, "but Claude said" and I just can't today.

@ForemanTaxLaw What was it?

It was about QSBS and not even a particularly complicated or convoluted part.

@richpriz From Grok: Explicit anti-avoidance language: The bill states that a §83 inclusion “does not prevent application of the bill’s provisions.” It also repeals the old IRS safe harbors (Rev. Procs. 93-27 and 2001-43) that previously allowed profits interests to go untaxed on receipt.

@richpriz Didn’t catch the footnote. So on the individual (and trust) LP side, their share of the loophole is getting closed as well unless I guess they allocate the deduction to those that can use it. How is 83(b) factored into the equation?

Carried Interest has been a talking point in tax policy for at least 20 years. It is often viewed as a loophole that if closed would bring in revenue.

@richpriz If taxing carried interest as true labor, shouldn’t that be deductible as an expense item (management fee) rather than reduction of the LPs share of gross income?

The full report is available here: budgetlab.yale.edu/research/refin…

@DailyTaxMemes I think we call this high school athletics?

The American mind can’t comprehend this

@ForemanTaxLaw @nickmeals Debatable, but no need for contributions to them to be deductible.

@nickmeals No need for there to be nonprofits.

100% tax on non-profit executive salaries over, say, $250K or so. See how fast this industry is cleaned up.

@ForemanTaxLaw Same way withholding and composite taxes raise revenue. They get the tax at the source at the highest rate (or close to it). There’s a reason every state essentially raced to implement it. Any time you can get PTEs to pay tax for the owners you do it.

@SmithMatthewC How do PTETs raise revenue? NYS's is literally dollar for dollar (as are most).

For what it's worth, PTETs should be set at like 110%. Still a net benefit for taxpayers, would actually pay for the extra processing that PTETs allow and raise revenue.

@nickmeals Get a POA on file and call? I assume I’m missing something though because I’ve never heard of needing the assignment date to get a 147c letter.

Any thoughts on how to get a 147c letter issued if client has no idea when it was assigned?

@ForemanTaxLaw Let's just pretend we can distinguish between temporary and subject to change.

@SmithMatthewC 41 was temporary until it was permanent. Then 174, which was permanent, became differently permanent, which then became permanently different, until it was changed.

A good rule of thumb on tax laws is that if a provision is temporary it shouldn’t exist at all and if a number is not indexed for inflation it should be zero.

@ForemanTaxLaw Dumb take.

@SmithMatthewC Everything is temporary in tax law, Matt.

@MdBergeron I'm not questioning the complexity (which I criticize all the time on here), but what a joke sending that letter to the IRS like it served any purpose beyond blatant grandstanding.

Many of my most successful clients have no concept of the complexity of defining income, deductions, taxable income much less basis and at risk limitations. It mocks complexity. It’s more relevant today than it was when written. Nothing is getting simpler. Sadly, I understand the need for the complexity in the current system of taxation.

I’ll be honest, this letter served no purpose and is just obnoxious.

@DailyTaxMemes What’s incredible is that it’s almost always a federal only issue because states like CA and NY have high withholding rates on that same comp. Feds need to set the bonus rate at 35%.

High income w2 taxpayers with a lot of equity comp/bonus/commissions are the worst return prep segment. There’s just really not a lot of planning to be done other than for the inevitable withholding shortfall

@George_A_Callas @rcassill @elenaspatel @J_C_Suarez It’s really just Tax Payment Day. Filing day is in October. (Quite the lineup for the event)

Looking forward to celebrating Tax Filing Day tomorrow at the Stanford Leadership Forum, where I will be speaking on the “Business, Taxation, and Society” panel with my colleagues @rcassill, @elenaspatel, @J_C_Suarez, and Gaurav Nagdev. gsb.stanford.edu/events/stanfor…

@tax_birdie I don’t care about her. The President is the one that should know better. It’s his damned law.

@SmithMatthewC We both know she probably is just misstating this. Lets give a little grace to the lay person here.

I can get over the Jesus meme and going after the Pope, but claiming a DoorDasher received an $11k refund due to No Tax on Tips is too far. DoorDashers are 1099ed, so not sure where this refund is coming from but also $11k on a $25k deduction? What bracket is she in?