Tax Strategies

While many of the non-tax provisions of the Housing and Economic Recovery Act of 2008, enacted on July 30, 2008, appear directly focused at the problems arising from the housing and mortgage crisis that has developed over the last year, the tax provisions appear at best to have only an indirect effect on the individuals most impacted by the subprime mortgages and declining home values.The tax title to the legislation includes many provisions focused on the low-income housing credit, housing and mortgage bonds, and real estate investment trusts. This column, however, will take a closer look at some of the individual tax breaks and revenue raisers most likely to impact individual taxpayers and their tax returns in 2008 and coming years.

Congressman Charles Rangel, D-N.Y., chairman of the tax-writing House Ways and Means Committee, never reported rental income from a vacation property he has owned in the Dominican Republic since 1988.

An Iowa man has been indicted for claiming a $240,009 refund of all the taxes he has paid, contending the Internal Revenue Service has no jurisdiction over him because the U.S. is a "fictional entity" and he is a "citizen of heaven."

U.S. and foreign tax rules increasingly influence where multinational companies are reporting their income is being earned, according to a new report that may influence tax legislation in Congress.

The Foreclosure Prevention Act of 2008, recently signed without fanfare by President Bush, contains provisions that will, according to insiders, complicate tax returns for years ahead.The tax portion of the bill, the Housing Assistance Tax Act of 2008, contains over $15 billion in tax incentives that are offset by a number of revenue raisers.

Congressional tax reformers are taking aim at one of the most cherished tax breaks available to working Americans — employer-paid health insurance coverage.During the latest round of tax reform hearings before the Senate Finance Committee, experts in both taxation and health care presented their case for eliminating — or at least sharply reducing — the federal tax subsidies given for employer-provided health insurance, which now provide the average U.S. taxpayer with nearly $3,000 a year in benefits.

The Justice Department has accused a former Internal Revenue Service secretary of cheating her tax prep clients and the government out of approximately $850,000.

The Internal Revenue Service has been asked to investigate James Manning, the pastor of Atlah World Missionary Church in Harlem, and the church's tax-exempt status after Manning repeatedly attacked Sen. Barack Obama, D-Ill., from the pulpit.

Charles Grassley, R-Iowa, ranking member of the Senate Finance Committee, said he planned to co-sponsor a bill that will update the deductible cost of operating a vehicle for charitable purposes.

The Internal Revenue Service is providing tax relief to flood-ravaged victims of Hurricane Gustav in the affected areas of Louisiana by postponing some tax-filing deadlines.