At Around the Tax World, you can find out all about what’s going on in the wonderful, worldwide world of tax. Every month, we’ll feature a few mini-articles on what’s been going on in the world when it comes to tax, and fully available for viewing even if you don’t have a subscription.
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In The Headlines
- What is the U.S. “gold card” visa program, and will it actually be implemented? The Trump administration recently introduced a new immigration program designed to provide wealthy foreign nationals with permanent residency in the U.S. The program would provide a visa in exchange for a $1 million payment to the U.S. government—or $2 million if a company is making the payment. The Trump administration has also proposed a “platinum card” for foreign nationals who are willing to pay $5 million for more residency and tax privileges. These programs are targeted at those who might ordinarily seek an EB-1 visa (for those with extraordinary abilities in their field) or EB-2 visa (for those with advanced degrees). The option to apply for a gold card or secure a place on the waiting list for a platinum card is already available online. Congressional approval is needed for the tax provisions linked to these programs, but that is currently on the backburner as lawmakers focus on the government shutdown. Some experts expect that the visa proposals may not be revisited until the next budget bill is passed.
- The world’s first global carbon tax hits a wall under intense opposition from the U.S. government. In 2023, the International Maritime Organization (IMO), which governs global shipping, agreed on a plan to reach net zero emissions by 2050. This would mean that by 2050 the shipping industry would be removing as much greenhouse gas from the atmosphere as it is creating. Part of the plan included a global tax on ships that exceeded certain emissions standards or failed to reduce their emissions over time. The IMO was expected to officially adopt the tax at its October meeting but ultimately decided to delay their vote until next fall. This came after several weeks of the Trump administration campaigning against the tax and threatening retaliation on countries that voted in favor of it. Threats included blocking ships from U.S. ports, visa restrictions, and higher fees and sanctions. Supporters of the tax estimate that the shipping industry’s contribution to emissions will rise from 3% to 17% by 2050 if no action is taken.
- “Bitcoin Jesus” agrees to pay $49.9 million to resolve tax evasion charges. Roger Ver, an early bitcoin investor and evangelist for cryptocurrency, was brought into court under charges of mail fraud and tax evasion. Ver publicly campaigned for Donald Trump last year and was represented by Trump’s former lawyer, Christopher Kise, in this case. Nicknamed “Bitcoin Jesus” for his role as an active crypto promoter, Ver formerly served as chief executive of Bitcoin.com. The investor renounced his U.S. citizenship in 2014 and became a citizen of St. Kitts and Nevis. During this shift in citizenship, U.S. law required Ver to file “expatriation” tax returns and pay taxes on the capital gains on his assets, which the lawsuit claims he did not do. A decade later, Ver was arrested and charged with almost $50 million in unpaid taxes, penalties, and interest from bitcoin holdings. Ver and the Justice Department recently came to an agreement that the indictment will be dismissed in one month if he pays the overdue taxes and penalties.
What's New In The Tax World?
The “One Big Beautiful Bill” Act could result in major tax cuts next year depending on the state you live in
The Trump administration’s new bill means major tax policy changes for business owners and individuals alike. The Tax Foundation estimates that taxpayers could see an average tax cut of $3,752 in 2026. However, the benefits you see will depend on where you live and how much income you earn. Estimates suggest that the biggest tax cuts will go to high-income Americans. The Tax Policy Center estimates that $6 of every $10 in tax cuts will go to the top 20% of income earners, mainly those earning $217,000 or more per year. By comparison, households in the bottom 20% of income earners will receive an average tax break of $150 next year.
Across the U.S., the biggest average tax cuts will go to mountain resort towns due to their outsized populations of high-income business owners. For instance, in Teton County, Wyoming—which holds the Jackson Hole ski area and half of Yellowstone National Park—the average resident will see a $37,373 tax reduction in 2026. This largely contributes to the state of Wyoming receiving the highest average tax cut, coming in at $5,374 per taxpayer. Washington and Massachusetts take second and third place with an average tax cut of $5,372 and $5,139 respectively. On the other end of the scale, Mississippi and West Virginia are expected to see the smallest tax cuts next year, partly because their average income is lower than the national average. Expected 2026 tax cuts come in at $2,401 for Mississippi and $2,503 for West Virginia.
Some tax policies will also provide more benefits to certain regions. A major one is the increased cap for state and local tax (SALT) deductions. Taxpayers who itemize their deductions can now deduct up to $40,000 in SALT on their federal tax returns. This primarily benefits high tax states like New York where itemizers are expected to see an average tax cut of $7,092. Itemizers in California and New Jersey will see average tax cuts of $3,995 or $3,897, respectively.
Since the details on how to apply these tax policies are still being determined, these changes may not be fully in place until 2026. However, refunds from the 2025 tax year are expected to increase. This is especially true for seniors due to the new $6,000 tax deduction for taxpayers over age 65 and for taxpayers who are eligible for the deductions on tips or overtime pay.
State-By-State Updates
- Iowa is anticipating a significant dip in tax revenue in 2026. The Iowa Revenue Estimating Conference is predicting a 9% decline in state revenue, amounting to a $375 million loss. This means that the gap between state revenue and next year’s budget will increase to $1.3 billion. The gap had already widened in 2025 when Iowa’s revenue came in at $198 million below its projections. Top reasons for revenue loss include the state’s decision to accelerate income tax cuts in 2024, rising unemployment rates, and reduced demand for soybeans as China begins importing from South American producers instead of the U.S. Republican leaders have suggested using money from the Taxpayer Relief Fund and the state surplus fund to cover the budgetary gap. However, Democratic leaders argue that this could set the state up for more trouble in future years, especially when it comes to funding public education.
- Massachusetts voters face as many as 47 ballot initiatives this November, including two on state tax laws. The first is a petition for a “Law Relative to Reducing the State Personal Income Tax Rate.” This initiative asks legislators to reduce state income tax from 5% to 4%. The second petition asks for a “Law Relative to Limiting State Tax Collection Growth and Returning Surpluses to Taxpayers.” This measure would require the state to refund taxpayers if total tax revenue collections increased by more than the average rate of wage increases in Massachusetts over the past three years. Combined, these tax changes could reduce state revenue by as much as $7 billion, a significant portion of Massachusetts’ $60 billion annual budget. Opponents of these measures worry the revenue loss will equal cuts to public schools, universities, public transportation, and other state services. According to data collected by Governor Maura Healey’s administration, the Trump administration’s tax cuts have already reduced the state budget by 5%, equal to $3.7 billion.
- New York leaders propose withholding federal income tax revenue in response to the Trump administration’s reduction in funding. The proposal would require the state comptroller to report on the amount of money the federal government owes the state, according to court rulings. If the comptroller determines that the Trump administration has been withholding funds against court orders, New York leadership would withhold the same amount in tax collections. The state is responsible for collecting federal income tax withholdings from residents’ paychecks and sending it to the federal government. In 2022, New York collected $361.8 billion in federal tax money and received $383 million from the federal government toward state projects and initiatives. However, in recent months, the Trump administration has withheld $18 billion in infrastructure funding and $34 million for counterterrorism efforts that had been designated for New York. The conflict between the president and New York lawmakers centers on new federal policies on immigration, transgender protections, and other changes.
- Texas voters will decide on lowering property taxes this November. Among the 17 propositions on the ballot this year, 11 deal with state taxes. One proposition on this year’s ballot would increase the homestead exemption from $100,000 to $140,000 starting this year. This would allow about 5.7 million homeowners to save money on their property taxes. A second proposition would also up the homestead exemption to $200,000 for people with disabilities and people over age 65. This would add to recent property tax cuts and the increased tax exemption for schools, both passed in 2023. Business owners and investors may also see tax cuts after November. Another ballot measure would increase the business tax exemption on equipment and inventory from $25,000 to $125,000. Other tax-related proposals would ban taxes on capital gains, inheritance, and securities.
Tax Planning Tips
Top U.S. universities are facing a steep tax increase via the “One Big Beautiful Bill.”
A number of higher education institutions across the country are putting the brakes on hiring, PhD enrollment, research, and other projects as they anticipate much higher tax bills in the coming years. This is largely due to President Trump’s new tax and spending act, which includes a major increase on endowment income. Previously, universities paid a flat 1.4% on investment returns from these special donor funds. Now universities may have to pay as much as 8% on endowment income.
The top tax rate affects institutions with more than $2 million in endowment assets per student. This includes schools like Harvard, MIT, Princeton, Stanford, and Yale. Estimates suggest that total tax revenue will amount to over $1 billion per university over the next five years. Universities with $750,000 to $2 million in endowment assets per student will pay a 4% tax. Finally, the original 1.4% tax will apply to those with $500,000 to $750,000 per student. President Trump has also enacted cuts to federal research funding that would normally go to these universities. The president has named leftwing bias and inadequate efforts to curb antisemitism during pro-Palestine protests as reasons for these cuts.
A Tale of Love and Taxes: What to know when your spouse is not a U.S. tax resident
For married couples that are “mixed nationality”—one is a U.S. citizen and one is a foreign national—filing taxes can be complicated. This is largely due to community property laws, which operate in many foreign countries including China, France, Mexico, Spain, Switzerland, and various Latin American countries. Community property rules also exist in a number of states like California, Texas, and Washington. “Community property” operates on the assumption that any assets a spouse acquires while they are married are co-owned 50/50 by both spouses. This includes any property or debts.
How do you know if community property laws apply to you? You will first need to look at the rules in the country (and state, if applicable) you first lived in as a married couple. If that jurisdiction expects you and your spouse to co-own any new property, those rules will affect how you are taxed even if you move to another state or country later on. In many cases, couples can change their tax treatment by formally opting into the new system or by satisfying long-term residency requirements in their new place of residence. To minimize their tax bill, mixed nationality couples need to do their due diligence to figure out how they will be taxed and take the necessary steps. This may include a prenuptial agreement or similar legal agreements that clearly define who owns which assets.
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CURRENT EDITION
An Analysis of the OBBBA’s Trump Accounts (Part 2)
In part one of this series, I went over the basics of the new retirement accounts for minors, Trump Accounts, which were created as part of the One Big Beautiful Bill Act (OBBBA). Trump Accounts allow the Government, Charitable Organizations, Parents, and others to contribute to a child’s savings, usually on an after-tax basis. These accounts then transition to a traditional individual retirement account (IRA) when the child turns 18. Although the contribution limits act like non-deductible traditional IRA contributions and have a contribution limit of only $5,000 per year, they do not have the same earned income requirements that traditional IRA contributions have. This means that children are able to accumulate savings even without earned income. This article presents several scenarios to examine how Trump Accounts may play into an overall savings strategy for children.
Another Tax-Smart Way to Save for Retirement
Most clients are familiar with the well-known accounts to save for retirement, such as the 401(k) and IRA. Some clients might be able to supplement those with a lesser-known vehicle as well. A life insurance retirement plan (LIRP) is a type of permanent life policy with a cash value basically funded by overpaying premiums. The money can eventually be taken as a tax-free loan against the policy for anything from medical expenses and long-term care to supplemental retirement income to, for the wealthy, the payment of taxes on large estates.
Taxes & Taxidermy: Rampaging Through The Tax Code On The Back Of A Stuffed Rhinoceros
Is the taxidermy fee for a stuffed bear deductible? If so, should I depreciate it? What would the basis and class life be for depreciation? Those are real questions asked in a group chat with some colleagues. Of course my answer was “It depends.” And, like all good tax professionals, I proceeded to ask a series of follow-up questions. And, like a good writer, that got me to thinking about all of the tax-related case law surrounding taxidermy and what it can teach us—it’s more than one might think.
