Now that the year 2010 has begun, I figured it would be interesting to look back at the most popular tax stories covered in my blog last year. Listed below are the top 10 tax stories of 2009, along with links to the various entries I posted on each topic. If you can think of another story that should be on the list, then send me a message on my Twitter profile.
1. The Housing Marketing and Homebuyer's Credit
The U.S. housing market keeps financial bloggers – like myself – captivated throughout the year. Back in early February, newly inaugurated President Obama launched a $75 billion foreclosure rescue plan to help American’s stay in their homes. However, foreclosures continued to trouble the country and drastically reduce home values across the country. In January the housing market began to show signs of recovery, and as the November 30th deadline for the first-time homebuyers credit loomed, home sales rose to a two-year high. However, before it expired Congress passed the Worker, Homeownership, and Business Act that extended the credit, and also created a lesser credit for taxpayers seeking to purchase a second home.
2. Auto Bailouts, Cash for Clunkers, and Special Deductions
Early in 2009 there was criticism of Obama’s plan to help General Motors and Chrysler stay afloat. It was even reported that taxpayers could lose up to $80 billion dollars in the automobile industry bailouts. However, taxpayers seem to forget about their concerns when Congress launched the Cash for Clunkers program, that gave Americans a credit to trade in old gas guzzlers for new, energy efficient vehicles. Even though the enormously popular program expired, there were still plenty of tax incentives to buy a car in 2009, including the ability to deduct sales tax paid on new vehicle purchases.
3. Joe Francis' Tax Problems
2009 was the year of celebrity tax problems. From former boy band member Lance Bass, to actor Nicolas Cage, to California's Governor Arnold Schwarzenegger, no one was exempt from having to pay the taxman. However, one celebrity tax evader seemed to generate more media attention than the rest, Joe Francis (creator of the Girls Gone Wild pornographic video series). Initially Francis blamed his financial woes on former employees, but later in the year he grabbed headlines again with his intent to sue the IRS.
4. Health Care Reform
Along with many other tax bloggers, I have discussed the topic of health care reform on my blog dozens of times throughout 2009. Improving the country’s health care was one of Obama’s campaign promises and is one that has captured the attention of Americans. While we will have to wait until Congress returns from their winter break to see if any legislation becomes law, you can check out this entry on the House of Representative’s Paying for the Affordable Health Care for America Act, or this entry explaining the Senate’s Patient Protection and Affordable Care Act.
5. California's Budget Problems
Between furlough days, and tax increases, California’s budget problems have become one of the major tax stories of the past year. In February the state legislators passed a budget, with billions of dollars in spending cuts, and over $12 billion in new state tax increases. Unfortunately, the cuts – especially furlough days – have had a drastic affect on Sacramento’s economy, where many of the capitol city’s workers are employed by the State. Additionally, later in the year it was reported that California’s revenue is falling short of what was expected, which will undoubtedly lead to budget problems in 2010.
6. USB Settlement and Taxpayer Amnesty Program
Shortly after taking office President Obama announced his intention to crack down on offshore tax evaders, and his administration certainly delivered. After months of negotiations, the U.S. Treasury Department reached a deal with UBS – the largest Swiss Bank – to turn over the names of thousands of taxpayers that had illegally avoided paying income taxes. The IRS then created an amnesty program allowing taxpayers to turn themselves in to avoid harsher punishment.
7. Ongoing Unemployment Rate Increases
Unfortunately, high unemployment rates have been an ongoing problem in 2009. In November, President Obama even announced that there would be even more job losses before the unemployment rates would improve. The Obama administration does assert that their programs have helped saved nearly 700,000 jobs this year. However, in December a study from UCLA suggested that unemployment rates could stay above 10% throughout 2010.
8. TARP Funds, Executive Bonuses, and Repayment
Early in 2009, taxpayers across the country were angered upon reports that AIG, a company that had recently received billions of dollars through the TARP Program, was giving out million dollar bonuses to dozens of executives. The U.S. Senate even considered taking action such as a new bonus tax. However, as the year continued the TARP Program began to create positive headlines when in June ten banks began paying the federal government back. Later in December, Bank of America even announced its intentions to repay TARP funds it had received.
9. Tax and Spending Protests
On April 15th, thousands of American taxpayers reportedly participated in the T.E.A. parties. Afterwards the GOP was quick to plan additional protests. Then, on July 4th dozens of taxpayer protests took place across the country, and months later in September thousands of taxpayers marched to the U.S. Capitol to protest the federal government’s spending.
10. Lack of Action on the Estate Tax
Towards the end of the year the estate tax became a very popular topic in the tax blogosphere. As I explained in this blog entry, Congress failed to pass any legislation on the estate tax, meaning it will not be in effect for the year 2010. However, on January 1st, 2011 it will return at rates higher than in the early 90’s. Although the House of Representatives passed legislation creating a permanent solution, the Senate did not follow suit. As the year came to an end, there were even reports of ill taxpayers clinging to life, while their families debated the tax consequences of keeping them on life support for a few extra days.