Economic Advisors’ Bafflegab

The President’s Council of Economic Advisors (CEA) recently released its seventh quarterly report regarding all of the wonderful achievements of the American Recovery and Reinvestment Act of 2009 (ARRA) – affectionately known as the “stimulus” legislation.

Now first of all, when any bureaucrats release any report on the Friday before an elongated holiday weekend (as these blokes did on Friday, July 1) you know they know that most folks have other things on their mind, and will probably miss or otherwise ignore the contents, in favor of their upcoming fun.  So here comes this Council, nonetheless touting its role in, “Part of the unprecedented accountability and transparency provisions included in the ARRA….”

Not to mention  more of the doubletalk included within the report.  F’rinstance:  “Following the implementation of the ARRA, the trajectory of the economy changed significantly….CEA estimates that as of the first quarter of 2011, the ARRA has raised employment relative to what it otherwise would have been by between 2.4 and 3.6 million…”

That’s all very nice – considering the $666 billion of stimulus funds expended to date, the cost per job “saved or created” is approaching $300,000!  Not to mention, of course, the offsetting economic reality of private sector jobs lost as a result of the administration’s outright stupid economic policies.

Check the report out for yourself – it’s only about 16 pages long.  If you can stand wading through all of the self-serving chatter, graphs and bafflegab, we commend you.

And in case you’re wondering, California is looking over your shoulder.  Particularly if you’re self-employed and perhaps not filing your personal and/or business entity tax returns with the Franchise Tax Board.

You see, there’s something known as the “City Business Tax Program,” under which over 100 cities share info with the FTB regarding blokes who possess a city business license, which the FTB can then check against its records as to who’s filing income tax returns and paying up.  If you’re one of those “nonfilers,” be on the lookout for a nastygram from FTB sometime soon.  And what’s good for the goose…..we hear that near the end of 2011, FTB will cross-notify the cities of income tax return filers which the cities can check against their records to determing whether a business license was procured and paid for.

And speaking of information sharing, let’s hear it for the U.S. District Court for the Eastern District of California (In Re:  The Tax Liabilities of John Does) which has refused to grant permission to the IRS to issue a summons for California Board of Equalization info detailing transfers of real estate between relatives, which the Revenooers could then use to look for the filing of gift tax returns and payment of gift transfer taxes.

But don’t expect the Revenooers to give up on this one.  They will likely find a way.

CONSULT YOUR TAX ADVISOR – This article contains general information about various tax matters.  You should consult your CPA regarding the implications to your own particular situation.

Jeff Quinn, the author of this article, is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno.  He may be reached at 831-7288, welcomes comments at jquinn@ashleyquinncpas.com, and invites readers to consider his other commentary at http://blog.nolo.com/taxes/.