Recently I wrote something on the question of whether what I call Rothing is mandatory. I am planning on taking credit for making Roth a verb, since I haven’t noticed anybody else doing it. Peter Coy in a piece in the New York Times, “The Retirement Maneuver More People Should Be Making,” used the term Rothification. A traditional IRA or 401(k) or similar account allows you to defer tax on the amount contributed and the account earnings. You or your heirs are taxable when money is withdrawn. If you exercise a Roth option either in the original contribution or in…

Oops. It turns out that the Internal Revenue Service can’t operate without some of its employees, particularly during tax filing season. On January 27, 2025, the day after the IRS began accepting individual tax returns for 2024, the Office of Personnel Management sent more than two million full-time federal workers an email offering them the option to resign from their positions but stay on the payroll through September 30, 2025 (the end of the fiscal year). Employees had until February 6th to accept the Deferred Resignation Program (DRP) offer. There was originally some ambiguity over whether resigning workers would have…

President Trump, who announced several rounds of tariffs last weekend, appears to be trying to use the import taxes for two distinct and entirely incompatible purposes: First, raising revenue to pay for costly tax cuts and new spending and second, as a cudgel to force countries to cooperate with his domestic policy agenda, including immigration curbs. His problem: If US trading partners capitulate to Trump’s policy demands, and he rewards them by withdrawing the tariffs, much of that hoped-for revenue will dry up. The question then is which does Trump want more: tariff revenue or perceived international policy victories? Over…

IRS Direct File remains open. That’s what you need to know about the IRS tax filing application after a post by Elon Musk on Monday created confusion about the program’s status. Musk posted on X (formerly Twitter) that he had “deleted” 18F, the group responsible for creating the technology behind projects like the IRS’ Direct File program, in response to a post suggesting that “the far left government wide computer office” was recently taken over by Musk allies. That caused some users on social media to incorrectly report that the program itself had been axed. About 18F 18F is not…

Now that tax season has started, you may feel concerned that you have an additional incentive to prepare and file your tax return carefully. Perhaps you were a vocal supporter of Kamala Harris during the election campaign. Maybe you openly criticize some of President Donald Trump’s policies or actively support causes that he disdains. What prevents President Trump, or his staff and cabinet members, from getting the IRS to audit your tax return because of your dissent or activism? Randy Joseph (CPA), the founder of the tax advisory firm Joseph & Hetrick in Seattle, has heard worries about this from…

Most people who are eligible for the earned income tax credit (EITC) and the child tax credit (CTC) claim those credits. Together, these credits lifted 6.4 million people out of poverty in 2023, more than any other federal program outside of Social Security. But some eligible people miss out on those credits. Direct File—the IRS’s new online tool for filing tax returns—may be the key to getting eligible filers to claim the EITC and CTC. Direct File guides people through their tax returns in an intuitive interview style and then empowers them to file their returns for free—from computers, tablets,…

In this episode of Tax Notes Talk, Tax Notes investigations editor Lauren Loricchio discusses security concerns regarding tax software platforms’ data-sharing practices. Tax Notes Talk is a podcast produced by Tax Notes. This transcript has been edited for clarity. David D. Stewart: Welcome to the podcast. I’m David Stewart, editor in chief of Tax Notes Today International. This week: the OECD and the EO. We’ve talked many times on the podcast over the past several years about the OECD and its two-pillar project which aims to update international taxation for the digital age. Today’s guest, Scott Levine, is very familiar…

Strategic tax planning is crucial, particularly for those intending to sell a property with a low initial value. One innovative method to avoid immediate tax obligations is through a Charitable Remainder Unitrust (CRUT). This approach allows individuals to transfer assets into a trust, which then generates income for beneficiaries over a set period. Afterward, the remaining assets are donated to a chosen charity. This setup not only supports charitable causes but also provides tax advantages, making it an attractive option for many. A CRUT is also a valuable tool in estate planning, though a Qualified Terminable Interest Property (QTIP) trust…

You can’t flip on the news or click through social media without hearing about tariffs. And while everyone thinks they know something about tariffs, how they actually work can be challenging to figure out—that’s because they are often a moving target. Here’s what you need to know. A tariff is a tax on imports. A country typically imposes tariffs to make money or protect certain industries from competition—sometimes, both. The idea is that tariffs make it more expensive to use foreign goods. In theory, this should mean a decline in imports (making those goods more expensive) and an uptick in…

On February 3, 2025, Mexico’s President Claudia Sheinbaum announced that the tariffs on Mexico shall be delayed for one month. This decision grants consumers some wave of relief. Tariffs are taxes imposed on imported goods, and their introduction can significantly alter prices, availability, and the overall economy. The recent turn of events, driven by an agreement between the US and Mexico, means that these tariffs will not be implemented immediately, providing temporary stability for the market. The agreement involves significant commitments from Mexico regarding border security, which played a crucial role in this decision. Without the immediate imposition of tariffs,…