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Week in Insights: Planning for Smooth Skies and Tailwinds Ahead

Nov. 27, 2022, 3:00 PM

My daughter, Kate, is on her way home for the Thanksgiving holidays. She will, thankfully, be settled by the time you read this.

These are some of the busiest travel days of the year, and we generally try to avoid those when possible. Still, a confluence of events, including last-minute projects and events, kept her at college a little longer. An early flight on Wednesday was our best option.

She texted me that she was getting ready to go. Kate is a seasoned traveler, so she knew to arrive early. She was also aware that Raleigh-Durham International Airport, where she would fly out, expected nearly 333,000 passengers to pass through this week, 14% more than the same week in 2019. At the time, that was RDU’s busiest year on record.

Shortly after that, she got a notification that her flight was delayed. It was the first flight out that morning, so I suspected it was more than a run-of-the-mill delay. After a second delay notification, she was already through security, and the pair of us were on the phone contemplating our alternatives.

While she initially balked at changing her flight because she didn’t want to deal with a connection, she eventually realized it was the better option and switched gears. And when her app didn’t reflect her updated flight properly, she quickly found an available gate agent to print a paper ticket.

Her connection was tight—just 30 minutes—in an airport she had never visited. We consulted the airport map and figured out her route. It was just a 10-minute walk, so I felt good about her chances. I wished her well as she boarded and reminded her to double-check her gate when she landed and let me know if there were any problems with the connecting flight. Thankfully, she made it, and all went smoothly.

That other flight? We knew, from asking the airline, that the delay was mechanical. We saw the notifications click by that it was delayed again. And then again. She clearly made the right choice.

An airline traveler at Ronald Reagan National Airport walks to a Transportation Security Administration (TSA) security checkpoint prior to traveling on Nov. 26, 2014, the busiest travel day of the year.
Photographer: PAUL J. RICHARDS/AFP via Getty Images

It was a good reminder that so much of traveling depends on your ability to plan and react to things beyond your control. Taking time to consider your options and commit to a new course of action can make all the difference—the same is true in tax.

Planning is essential. While you never know what obstacle might get tossed your way—from a technical snafu to an obstinate client—taking the time to consider a different way forward when that happens can make all of the difference.

At Bloomberg Tax, we aim to make it easy for you to have the information you need to make good decisions. Our experts offer great commentary and insightful analysis on federal, state, and international tax issues to keep you moving—with smooth skies ahead.

The Exchange… It’s where great ideas intersect.

—Kelly Phillips Erb

Quick Trivia

If you’ve traveled recently, it feels like airline fees and taxes are way up. But, remarkably, the passenger ticket tax for domestic travel is less than it was just 30 years ago. What is the rate today?
Answer at the bottom.

Save the Date

How much should your firm or practice get involved in political issues, if at all? Should your business contribute to an elected official, political candidate, or a political cause or take a political candidate or official as a client? If you do, what questions could you face from your stakeholders?

Find the answers to that question and more by joining Bloomberg Tax and Bloomberg Law Insights & Commentary teams this Wednesday, Nov. 30, from noon to 1 p.m. ET for “Should Your Company Take a Stand on Political and Social Issues?” part of our free virtual Lunch & Learn series. Two attorneys from Skadden, Arps, Slate, Meagher & Flom LLP will lead a discussion about political and social issues in the workplace,

You can join us for this event, no registration required, by signing on here at noon ET on Nov. 30 or by calling +1-929-205-6099 US and entering the meeting ID: 975 6437 0979.

Federal Insights

Our two-day series on the IRS’s decision to revive a Superfund tax on chemicals had Holland & Knight’s Nicole Elliott discussing how businesses are working off an outdated law without the guidance they need to ensure they’re meeting their obligations, and Rachel Smith and Taylor Cortright of KPMG’s national tax practice in Washington, D.C. examining how chemical importers must carefully consider whether chemical derivative products could be taxable, a decision that could put them at a competitive disadvantage.

A voluntary disclosure agreement can benefit both sides in a merger and acquisition transaction. By stressing the extent to which the parties are aligned, a buyer and a seller may be able to negotiate more efficiently to mitigate overall tax liabilities, according to Sidley Austin’s Katharine A. Funkhouser, Tara M. Lancaster, and Richard M. Silverman.

The Inflation Reduction Act’s adoption of corporate tax provisions is a big step toward a more equitable tax code, but lawmakers also must provide economic security for the millions of lower- and moderate-income households, say the Institute on Taxation and Economic Policy’s Joe Hughes and Brakeyshia Samms.

Global Insights

The sports industry, and soccer in particular, moves billions of dollars around the world. Soccer’s global importance, plus recent moves by multinational enterprises into the industry, may bring closer attention from tax authorities, says Cristian Faundez of KPMG LLP.

Laurence Field of Crowe provides his perspective on the recent tax measures in the UK government’s Autumn Statement, delivered on Nov. 17.

As European governments seek to improve value-added tax reporting and collection, Luca Clivati of Sovos considers the moves by the European Commission towards introducing a pan-European model for digital VAT reporting.

Reader Responses

At The Exchange, we welcome responses from our readers and encourage diversity and civil discussion. We are especially interested in responses that add to the conversation, or introduce a different point of view. If you have a response to one of our published Insights, we’d love to hear from you.

A Closer Look

Nonfungible tokens hold intrinsic value due to their digital properties and traits. In this edition of “A Closer Look,” Stout’s Fotis Konstantinidis looks at the challenges of valuing NFTs, as well as the methods and data used for valuation.

Our Wish List

What’s on Bloomberg Tax Insights’ wish list right now? For December, we’re hoping to end the year on a high note with a wrap-up of the year and a peek ahead. We’re interested in: What did you think was newsworthy in tax in 2022? What should we look out for in 2023? What should tax professionals do now to prepare for next tax season? We’re looking for a thoughtful take that will get tax professionals talking about next year ... even before the calendar flips over.

Our Insights articles—about 1,000 words—are written by tax professionals offering expert analysis on current tax practice and policy issues, tax trends and topics, and tax and accounting firm practice and management. If you have an interesting, never-published article for publication, we’d love to hear about it. You can contact our Insights team at TaxInsights@bloombergindustry.com.

Columnists

Is communication containing both legal and non-legal advice subject to attorney-client and tax practitioner privilege? The issue is before the Supreme Court, but other pending litigation could help show the line of liability for lawyers and tax practitioners, columnist Andrew Leahey writes.

Looking to do some shopping this holiday season? Be prepared for higher prices. This week, I took a look at how inflation could affect your wallet and your tax bill—by looking at PNC’s Christmas Price Index, an annual tradition that measures the cost of buying the gifts given in the classic holiday song “The Twelve Days of Christmas.”

News

It’s been a busy week in tax news from state capitals to Washington. Here are some stories you might have missed from our Bloomberg Tax news team.
*Note: Your Bloomberg Tax login will be required to access Tax News.

  • The Treasury Department, Congress, and big US companies are wondering about how best to fit a domestic-tax square peg into an international-tax round hole.
  • The growing hydrogen industry got a big boost from President Joe Biden’s tax-and-climate law: a new 10-year tax credit for clean hydrogen production. Here’s what you need to know.
  • US accounting rulemakers were already considering tackling the thorny issue of accounting for freshly minted crypto tokens in their prolonged effort to write guidance for cryptocurrencies. Then came the collapse of crypto exchange FTX.
  • California collected 698.6% more in personal income-tax revenue last month than it expected, according to a bulletin from the California Department of Finance.

Listen Up

On this week’s episode of Talking Tax, we bring you two discussions that focus on some of the biggest developments facing multinationals’ tax departments.

Career Moves

Rochelle Haller has joined Fox Rothschild LLP as a partner in the taxation and wealth planning department in Seattle, Wash., according to the firm.

Simpson Thacher & Bartlett LLP will elevate three tax attorneys in New York to partner on Jan. 1, the law firm announced.

If you are changing jobs or being promoted, let us know. You can email your submission to TaxMoves@bloombergindustry.com for consideration.

Spotlight

Our Spotlight series highlights the careers and lives of tax professionals across the globe. This week’s Spotlight is on Vimal Bava, a certified public accountant and website developer in Bryant, Ark. who markets himself as “The Backpack CPA.”

Quick Trivia Answer

The passenger ticket tax—sometimes called the US Excise Tax, US Domestic Transportation Tax or US Ticket Tax—is 7.5%. It was 10% in 1992.

Our Team

We talk about tax a lot. But there’s a lot more that you might hear us talking about if you popped into one of our Teams meetings. Here’s a quick look at what some of us are watching, reading, and listening to this week:

Watching:

  • Rebecca Baker (Editor at Large, Insights and Commentary, Bloomberg Tax): “Exodus,” a 3+-hour epic starring Paul Newman and Eva Marie Saint. Always relevant, even more so now, and the ending is heartbreaking on multiple levels, more than 60 years later. Dalton Trumbo’s best screenplay by far.
  • Kelly Phillips Erb (Team Lead, Insights and Commentary, Bloomberg Tax): The World Cup, clearly. We haven’t missed a match yet.

Reading:

  • Andrew Leahey (Columnist, Insights and Commentary, Bloomberg Tax): “The WPA Guide to 1930s New Jersey.” The federal Works Progress Administration hired writers in the 1930s to create “guides” to each state and major metropolitan areas or cities—they’re all fascinating. The Federal Writers’ Project produced the works, and there wasn’t a lot of oversight in terms of what was included, so each set of authors kind of made it their own. Many of them are available online, and Rowan University maintains a database. Highlights so far include the aforementioned New Jersey, the Guide to Philadelphia, and the state guide to New York.
  • Melanie Cohen (Editor, Insights and Commentary, Bloomberg Tax): “Running While Black,” a memoir by Alison Mariella Désir about her experience as a Black endurance runner in a predominantly white space, the racism she endured, and the community she helped build.

Listening:

  • Rachael Daigle (News Director, Bloomberg Tax): The usual Spotify music list and Kids Stories Podcast with Phil Bechtel because my kids are obsessed.

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What Did You Think?

Your feedback and suggestions are important to us, so don’t hesitate to reach out on social or email me directly at kerb@bloombergindustry.com.