Week in Insights: It’s the season

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By the time this email arrives in your inbox, Santa will be safely back at the North Pole. But don’t take my word for it, you can follow Santa’s journey online and at Twitter.

NORAD, or the North American Aerospace Defense Command, is a real organization. A joint effort between the United States and Canada, its missions include aerospace alert and aerospace control. In other words, they follow everything that flies in and around the two countries.

And every year on Christmas Eve, NORAD has a special mission: to hunt down Santa Claus.

The mission, which began in 1955, actually started out as an accident. A child dialed a phone number from a Sears department store ad in the local newspaper. He thought he was calling Santa Claus, but instead he called the Continental Air Defense Command Operations Center in Colorado Springs, Colo.

Air Force Colonel Harry Shoup was on duty that night. He told the child – and several children who called after that – that he was indeed Santa Claus and that he was on his way. Eventually, Shoup assigned a duty officer to answer calls.

NORAD was officially formed three years later. And since then NORAD has reported Santa’s location to children around the world.

In 1997, NORAD went live and its Santa tracker got 1 million hits in its first year.

Today, the Santa Claus Tracker is one of the Defense Department’s largest community outreach programs and is funded by contributions from corporate donors. NORAD hotline phones — yes, kids always call — are manned by volunteers.

Santa Claus waves to the crowd at Macy’s Thanksgiving Parade on November 27, 2014 in New York City.

Photographer: Andrew Burton via Getty Images

My kids loved NORAD, and over the years we’ve had quite a bit of talk in my house about how Santa manages to do all of his work. And since I’m a tax lawyer, we also talked about tax consequences. We discussed everything from the residence – my kids decided early on that Santa Claus was an American resident since their letters from Santa were stamped in the North Pole, Alaska – to the size of his estate, which of course. , drops every year when it offers toys.

It’s a fun reminder that tax touches every part of our life, even during the holidays. And in the hustle and bustle of the season, it can be difficult to stay on top of what’s going on in the tax world. Fortunately, this week, as always, our experts have the latest federal, state and international tax analysis to help you stay informed up to the minute, much like NORAD.

The Exchange… This is where great ideas intersect.

—Kelly Phillips Erb

Quick numbers quiz

Santa’s sleigh probably wouldn’t qualify for the business mileage deduction, but if it did, how much would Santa have been entitled to in 2021 for his Christmas Eve deliveries?
Answer below.

Our roundup

This week, our experts covered a wide range of topics, from foreign source income to cryptoassets. For a glimpse of what’s in the news, here’s our roundup:

Technology has made it easier to keep track of Santa Claus and sales. In Single Window Launch in Germany — A Journey Into the Unknown, Roger Gothmann of Taxdoo describes some of the problems encountered in launching the VAT platform in Germany and the challenges for taxpayers and their advisers that arose as a result.

Buying on credit is something many buyers do this time of year, but is it a good idea? The US corporate tax causes considerable economic damage by strongly favoring debt over equity, write professors Mark Roe and Michael Troege. Instead, in Ending Tax Law’s Subsidy for Corporate Debt, they suggest we look at the Allocation for Corporate Equity – or ACE – which sets a tax-deductible cost for equity based on corporate rates. government bonds.

A Santa Claus meets people at a hutong in Beijing on December 23, 2014.

Photographer: FRED DUFOUR / AFP via Getty Images

Santa Claus is not the only one doing global transactions. In Malaysia Bracing for Taxation of Foreign Source Income, Yvonne Beh and Irene Khor of Wong & Partners highlight the impact and practical considerations that businesses and individuals should consider in preparing for the impending taxation of foreign source income in Malaysia. .

What a wild ride it has been for crypto this year. In Cryptoassets and International Information Exchange, Alfredo Collosa examines the many challenges tax authorities around the world face in regulating cryptoassets and argues that an international information exchange regime is essential.

A recent tax ruling that tax exclusion and tax laws should be interpreted strictly in favor of taxpayers sounds like a giveaway. But in Pennsylvania, Greenwood Gaming’s decision could have a big impact, BakerHostetler’s Michael Semes writes that following Greenwood Gaming, a taxpayer challenging the department’s interpretation of a law should carefully consider the court’s analysis in that case.

At the end of the year, we all think about the rest. This is also true for the tax and accounting profession. In The Future of Accounting: How a New Generation Can Meet the World’s Biggest Challenges, Carmine Di Sibio, EY Global CEO, writes that he “has never seen a more important and inspiring moment. to be an accountant ”.

Opinion and commentary

We know the United States is experiencing supply shortages. But could it get worse? In Proposed Tax Hike May Worsen Plastic Shortages and High Prices, Professor Michael F. Gorman, Ph.D. argues that a pending tax proposal could make matters worse.

Columnists and contributors

Lately, social media has drawn a lot of attention to share sales and stock options following a series of tweets from Tesla CEO Elon Musk. The exercise of stock options and the sale of stock are both subject to federal tax. And while most of us aren’t cashing out billions, if not millions of dollars in stock options, they’re not limited to the ultra-rich. Here’s what even those of us who aren’t billionaires need to know about stock options.

A man dressed as Santa Claus dives at the Creta Aquarium in the town of Heraklion, on the island of Crete, southern Greece, December 14, 2019.

Photographer: JASON TAVLAS / AFP via Getty Images

Projector

Our Spotlight series shines a light on the careers and lives of tax professionals around the world. This week’s spotlight is on former IRS revenue officer Michael Raanan.

To listen

In response to the Panama Papers scandal, the EU agreed to regulations requiring the publication of beneficial ownership records. It should therefore follow that the more information about individuals and corporate identities is accessed, the easier it is for financial and related entities to help with legitimate businesses. On this week’s episode of the Taxgirl podcast, Kelly Phillips Erb of Bloomberg Tax is joined by Daniel Wager to discuss tackling financial crime, increasing transparency and property records. Wager is Vice President of Financial Crime Compliance at LexisNexis Risk Solutions.

To catch up

It’s been a busy week in tax news from state capitals to DC Here are some of the stories you may have missed from our Bloomberg Tax News team:

* Note: Your Bloomberg Tax ID will be required to access Tax News.

Get noticed

At Bloomberg Law, we pride ourselves on our continued efforts to showcase the next generation of leaders in the legal profession.

We are excited to announce our 2022 call for nominations for “They’ve Got Next: The 40 Under 40,” Bloomberg Law’s special report recognizing the accomplishments of remarkable young lawyers nationwide.

Here are the nomination criteria and submission instructions.

Quick response to numbers

Timmy McGovern dressed as Santa Claus walks along the beach handing out candy canes and posing for photos with beach goers on December 21, 2015 in Fort Lauderdale, Florida.

Photographer: Joe Raedle via Getty Images

$ 42,280,000. This assumes Santa has driven 75,500,000 miles, or 91.8 million stops, according to MIT researchers, calculated at 56 cents per mile, which is the 2021 business mileage deduction. In 2022, Santa could deduct a little more, since the deduction for business mileage has increased to 58.5 cents per mile.

Be sociable

Follow Bloomberg Tax on Twitter, Facebook, Instagram, and LinkedIn — and check out Bloomberg Law on TikTok.

We also have a growing LinkedIn group where our authors, contributors, and readers can share tax-related stories and exchange ideas. We hope you join the conversation!

What did you think

Your comments and suggestions are important to us, so please feel free to contact us on social media or email me directly at [email protected]



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