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Special Rate For Flow-Through Entities Is A Really Bad Idea

Comprehensive tax reform and simplification is a fantastic idea. We here at the ABC Coalition for DEF just love the idea that you are working on it and totally support you. Of course we are sure that you know the DEF is critical to the American way of life and the health, safety and well-being of the world. We would just like to remind you that the GHI deduction and the JKL credit play a critical role in supporting DEF. So when you are doing your simplifying don’t even think about messing with the GHI deduction and the JKL credit. As a matter of fact, you probably should beef them up a bit and get busy on the MNO exemption that we have been asking for. Other than that, chop away at those special tax breaks and give us a simpler Code.

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Trump’s Corporate Tax Rate Cut Will Wreak Havoc With Reported Earnings

I spoke with Professor Tracy Noga, Associate Professor of Accountancy at Bentley University.  She confirmed for me that the boost or hit to reported earnings is immediate and that it is at the currently enacted rate.  She also told me that she expects that the adjustment will wreak havoc with earnings.  What neither one of us can figure out to any satisfaction is how analysts will take this into account.  Will they recognize that 2017 earnings reports will be radically distorted by this tax change?  Maybe they are all focused on EBITDA and they won’t even notice.

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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.