As an expert in tax evasion history, I’ve seen my fair share of financial scandals and missteps. Today, I want to shed light on a recent development that has been causing quite a stir in the financial world. The cost of extending the Trump tax cuts, according to an analysis by the Committee for a Responsible Federal Budget (CRFB), a Washington think tank, has been increasing annually, and the reasons behind this are not entirely clear.(source)
According to current Joint Tax Committee and Congressional Budget Office projections, extending the expiring provisions in former President Trump’s tax cuts is slated to cost more than $4 trillion by 2028. This is a significant increase from the estimated $3 trillion when the law was passed, marking an increase of roughly 33 percent. This increase is more than what would be expected from growth in the economy and inflation alone.
The CRFB suggests that this deficit boost could be due to tax evasion on one of the revenue expanders in the 2017 law, as well as abuse on the Trump pass-through deduction. Pass-through entities, businesses structured as partnerships and S-corporations that allow owners to claim their income on their personal tax returns, have seen an influx in filings and a previous drop in corporate audits. This has led the IRS to set up a new department to go after uncollected taxes held by pass-throughs and complex partnerships.
As we delve deeper into the archives of tax evasion history, it becomes clear that the consequences of such actions are far-reaching and often unexpected. The rising cost of the Trump tax cut extensions serves as a stark reminder of the importance of complying with tax laws and the potential repercussions of tax evasion. It’s a cautionary tale that underscores the need for responsible financial citizenship.