Tax Those Financial Transactions!
So saith Senator Tom Harkin (D-IA) and Congressman Peter DeFazio (D-OR) in their recently introduced “Wall Street Trading and Speculators Act,” which would slap a new tax of three-hundredths of a percent on certain “covered” financial transactions.
So there, you greedy “speculators,” who obviously are raping the rest of us and need to pay more on your (supposed) ill-gotten gains!
The proposed new tax would be levied on the fair market value of any security being purchased or cleared on a United States facility or transactions with respect to derivatives traded or cleared on a United States facility or under which a U.S. person has rights.
Quoth DeFazio: “This Wall Street Speculator Tax should be a no-brainer. It will raise significant revenue that we desperately need and reins in the excessive speculative activity that has destabilized our financial system. The only way we can meaningfully address our deficit is by taking a balanced approach that includes revenue raisers and smart, targeted cuts. This bill should be part of that balanced solution.”
Aren’t they wearing out the “balanced approach” jargon? Can’t they come up with any better arguments, or do all of the focus groups indicate this is working?
And from our “quit blaming it on your accountant” department, comes word this week that late filing penalties can’t always be avoided by pointing your arguably unsuspecting finger at your accountant and his bad advice.
To make matters worse, this most recent declaration comes from the Ninth Circuit Court of Appeals – the appellate court which governs folks in our part of the world.
The Ninth circuit, in the case of Peter Knappe, Executor of the Estate of Ingborg Pattee, says the IRS was correct in refusing to abate an estate’s late filing penalty even though the estate tax return was filed within the extended due date supplied by the accountant. In this instance, the accountant secured an automatic extension for filing a decedent’s estate tax return, but told the estate it was good for one year, rather than the correct period of six months.
The law does allow for excuse of the late filing penalty in cases where the tardiness was (1) due to reasonable cause, and (2) did not result from willful neglect. Reasonable cause requires a showing that the taxpayer exercised ordinary business care and prudence – in some situations, an easily-fulfilled condition in which the culprit truly was faulty advice issued by a professional.
In this case, however, the Court found the executor did not exercise ordinary business care and prudence when he relied unquestioningly on the CPA’s advice, and that he unreasonably abdicated his duty to ascertain the filing deadline and comply with it.
The Court acknowledged that the result imposes a heavy burden on executors, who will affirmatively have to ensure that their agents’ interpretations of filing and payment deadlines are accurate if they want to avoid penalties.
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 can be reached at 831-7288, welcomes comments at firstname.lastname@example.org, and invites readers to consider his other commentary at http://blog.nolo.com/taxes.