Key Takeaways
- Bill would increase automatic disaster extensions, apply them to disasters declared by governors.
- Copper tariffs.
- Canada tariffs.
- Brazil tariffs.
- Vietnam tariffs.
- Random tariffs.
- Big bill has some surprisingly small breaks.
- Gamblers lose again.
- How you can make it harder on ID thieves.
- Biofooling.
- Blueberry Muffin Day.
Filing Extension Bill for State Disasters Awaits Trump’s OK - Doug Sword, Tax Notes ($):
The Senate passed the Filing Relief for Natural Disasters Act (H.R. 517) by unanimous consent July 10. The bill, introduced by House Ways and Means Committee member David Kustoff, R-Tenn., and cosponsored by Ways and Means member Judy Chu, D-Calif., passed the House 388 to 0 on March 31.
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It also doubles to 120 days the automatic 60-day extension of deadlines for relief workers, individuals killed or injured as a result of a federally declared disaster, and taxpayers whose principal residence, business, or tax records are in a federally declared disaster area.
Tariffism
Trump’s Tariffs Send Copper to Record, Dow Industrials Slip - Alexander Osipovich, Wall Street Journal:
Speaking at a cabinet meeting, Trump said the U.S. would impose 50% tariffs on copper—a component of electrical wiring, motors and many consumer goods.
Front-month U.S. copper futures soared 13% to settle at an all-time high of $5.6450 per pound, in their biggest one-day move in records going back to 1968, according to Dow Jones Market Data. Shares of Freeport-McMoRan, a major copper miner, jumped 2.5%.
Trump’s 50% Copper Import Tariffs to Include Semi-Finished Goods - Julian Luk, Joe Deaux, and Catherine Lucey, Bloomberg ($):
It has been widely expected that refined copper would be tariffed, but it was unclear what would happen with semi-finished products — a category that includes wires, sheets, tubes and plates. Including semi-fabricated goods would ramp up the impact of the levies. Copper on Comex in New York rose as much as 1.3% in early Asia trading on Friday.
Donald Trump threatens new tariffs on Canada - Lauren Fedor, Aime Williams and Ilya Gridneff, Financial Times:
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An administration official said the tariffs on Canada would “likely” be waived for goods that complied with the terms of Trump’s 2020 trade agreement with Canada and Mexico, but said “no final decisions” had been made. Such an exemption could significantly blunt the damage of the higher tariff.
Vietnam Surprised by Trump Tariff Decision, Seeks Lower Rate - Francesca Stevens, Josh Wingrove and Nguyen Dieu Tu Uyen, Bloomberg via MSN:
Straight after last Wednesday’s call with Trump, Vietnam’s party chief To Lam told his negotiating team to keep working to bring the tariff rate down, the people said, asking not to be identified as the talks are confidential. The 20% figure came as a surprise as Vietnam believed it had secured a more favorable tariff range, the people said.
As Trump Sows Tariff Confusion, Rules of Global Commerce Give Way to Chaos - Jeanna Smialek, New York Times:
He has changed deadlines suddenly. He has blown up negotiations at the 11th hour, often raising unexpected issues. He has tied his tariffs to complaints that have nothing to do with trade, like Brazil’s treatment of its former president, Jair Bolsonaro, or the flow of fentanyl from Canada.
Passing the bill to find out what's in it
Some of the ‘Big, Beautiful’ Tax Breaks Are Smaller Than You Think - Laura Saunders, Wall Street Journal:
The same holds true for the new $6,000 deduction for taxpayers age 65 and older. It sounds terrific, but it phases out beginning at $75,000 of income for single filers and $150,000 for married couples filing jointly. There is a marriage penalty with this one, too.
Lawmakers Try to Reverse Tax Increase on Gamblers - Jasmine Li, Wall Street Journal:
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For gamblers, the change means they could owe more taxes if they lose money or win by slim margins. Larry Campagna, a tax attorney at Chamberlain Hrdlicka, described a scenario where a gambler wins $1 million and loses $1 million, breaking even.
“Under prior law, those would have offset each other and you’d have zero tax to pay because you have zero net income from gambling,” he said. But under the new law, the taxpayer would only get to deduct $900,000 of the losses, meaning the person would owe tax on $100,000—even though they didn’t have $100,000 worth of gains.
Trump Order On Solar, Wind Credits Puts Industry On Heels - Kat Lucero, Law360 Tax Authority ($):
Trump issued an executive order Monday directing Treasury and the U.S. Department of the Interior to issue rules and guidance to wind down the clean electricity production and investment tax credits under Internal Revenue Code Sections 45Y and 48E for wind and solar projects. That guidance must come within 45 days from Trump's July 4 signing of the budget legislation that moved up the credits' end date, known as the One Big Beautiful Bill Act.
Related: Major Tax Overhaul: What the New Law Means for You
What Will The Tax Provisions Of The Big Budget Bill Really Do? - Howard Gleckman, TaxVox. "Step back from the details and, at 30,000 feet, the bill has four overriding characteristics. It is regressive, expensive, complicated, and it treats people who make roughly the same amount of money in very different ways."
Conservatives are asking Trump for another big tax cut - Jeff Stein, Washington Post:
Although a 1992 Justice Department opinion found that such a change would require an act of Congress, Norquist and other conservatives want the Treasury Department to execute such a policy unilaterally if necessary, providing a major windfall for people selling stocks, art, businesses, homes and other assets.
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It is unclear if the administration is currently considering such a plan.
Thwarting ID Thieves
IRS Online Account and identity protection PINs protect against fraudsters - IRS:
Important things to know about an IP PIN
- Anyone with an SSN or an ITIN can get an IP PIN including individuals living abroad.
- It's a six-digit number known only to the taxpayer and the IRS.
- It helps us verify the taxpayer’s identity when filing a tax return. The account is protected even if there is no filing requirement.
- Only taxpayers who can verify their identity can get an IP PIN.
- Tax professionals can’t get an IP PIN on behalf of their client but may obtain it directly from the taxpayer for filing purposes.
- Each IP PIN is valid for one year. When it expires, a new one is generated for security reasons.
- Taxpayers with an IP PIN must use it when filing any federal tax returns during the year, including prior year tax returns or amended tax returns.
- The program is voluntary, though it’s strongly encouraged.
- The IRS will never call, email or text the taxpayer to request their IP PIN.
Blogs & Bits
Standard tax deductions for 2025 bumped up by one big bill - Kay Bell, Don't Mess With Taxes. "For this tax year, the standard deduction increases from $15,000 for single taxpayers to $15,750; from $22,500 for head-of-household filers to $23,625; and from $30,000 for married couples who file jointly to $31,500."
District Court Upholds Validity of IRS Guidance on Employee Retention Credit - Parker Tax Pro Library. "A district court held that the IRS did not violate the Administrative Procedure Act (APA) when it issued Notice 2021-20, which provides guidance on the employee retention credit in question-and-answer format."
Tax Rules for Rental Properties and Vacation Homes - Ashley Akin, Tax School Blog. "Taxpayers who use their real estate for both personal and business purposes must split expenses between personal use and rental activity. Expenses are divided based on the number of days used for personal reasons as compared to rental days."
OB3 Act: Business Expensing Enhanced - Thomas Gorczynski, Tom Talks Taxes. "The additional first-year depreciation deduction is made permanent, and increased to 100% for property acquired and placed in service after January 19, 2025, and for specified plants planted or grafted after January 19, 2025."
Biofooling
10th Circ. Affirms Sentence In $1B Energy Tax Credit Scheme - Anna Scott Farrell, Law360 Tax Authority ($, defendant name omitted):
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The scheme involved generating false renewable credits through the EPA by purchasing processed biofuel, mislabeling it as unprocessed and transporting it to create the appearance of distributing it before finally reselling it as processed, either on the market or to [defendant's] companies at discounts, according to the panel.
[Defendant] and others used the false paperwork they generated by rotating the biofuel to file false claims for biofuel tax credits. The IRS paid out over $500 million in fraudulent tax credits on account of the scheme.
The article says the defendant received a 40-year sentence.
This one fraud ring apparently bilked the taxpayers of half of a billion. This isn't the only example of biofuel fraud. If Congress has learned any sort of lesson about handing out tax credits, it's not obvious what that lesson might be.
What day is it?
National Blueberry Day was earlier this week, so naturally today is National Blueberry Muffin Day!
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