Week in Insights: Paving Your Personal Path Ahead

I’m Melanie Cohen, an editor with the Insights & Commentary team at Bloomberg Tax, and I’m taking over Week in Insights this week. These days, I’m known among my friends and family for how much I enjoy being active. I rarely go a day without running or taking a yoga class, and I’ll walk almost anywhere if it’s under 2 miles.

But growing up, I was pretty sedentary. I lacked the innate talent a lot of the other kids were praised for in PE class. Rather than being encouraged, I was chastised by my teachers for not being good enough. It deterred me for the entirety of my childhood and into adulthood.

I gradually became more active when I moved to Washington, D.C., from St. Petersburg, Fla., in 2008. I’d sold my car when I moved and quickly realized the ease of getting around on foot, noticing the interesting scenery that was all around me. I started running a year later, after seeing various friends and family members run races and talk about their love of running. This inspired me, without feeling like I was being pushed, to start along a new path.

More than 12 years later, I’m part of a weekly running club and have run nearly 20 half marathons, one marathon, and countless races of other distances. Of course, I’ll also be running our virtual 5k this week. The proceeds support World Central Kitchen, which works to fight hunger around the world.

Aliphine Tuliamuk reacts as she crosses the finish line to win the women’s U.S. Olympic Team Trials for the marathon on Feb. 29, 2020, in Atlanta.

Photographer: Kevin C. Cox/Getty Images

And not every runner has the same story. Aliphine Tuliamuk had an unexpected break in her training schedule when the 2020 Olympics were postponed because of Covid-19. The 33-year-old professional marathoner, who wowed the running world when she won the US Olympic Team Trials for the marathon in February 2020, decided not to delay her dream of becoming a parent with partner Tim Gannon after all the year’s major races ended up canceled.

“When the Olympics were postponed, every day I just had this lump in my throat … then knowing that the rest of the races weren’t going to happen, it was just the final straw,” she said in an interview with Women’s Running. “Literally, I went from an amazing workout to getting home and saying, ‘We are having a baby.’” Tuliamuk gave birth to baby Zoe in January 2021.

Fast forward to the Tokyo Games less than seven months later. Tuliamuk, who had been building up her training to compete in the Olympic Marathon, dropped out after suffering from hip issues. She spent the next several months rehabbing and building back strength before returning to competition last month, getting second place at the Pittsburgh Half Marathon in early May and winning the USATF 25k Championships two weeks later. Tuliamuk, who beat runner-up Keira D’Amato by only 45 seconds in that race, won her 11th national title.

Keira D’Amato of the United States begins to celebrates as she approaches the finish line during the 2021 Chicago Marathon on Oct. 10, 2021, in Chicago. D’Amato finished fourth in the women’s field.

Photographer: Jamie Sabau/Getty Images

D’Amato, too, hasn’t run straight up the hill to success. The 38-year-old real estate agent and mom of two, who signed a contract with Nike last year, ran in college before leaving the sport in 2009. She “hobby jogged” for several years before more seriously picking up the sport again in 2016, looking for a stress release. In January, she set the American record for the marathon, beating Deena Kastor’s 2006 time by 24 seconds with a time of 2:19:12.

Tuliamuk’s and D’Amato’s stories illustrate that the road to success will often present hurdles. At Bloomberg Tax, we aim to help you move past those hurdles by staying informed with great commentary and insightful analysis on federal, state, and international tax issues—and hopefully encourage you to go the distance.

The Exchange… It’s where great ideas intersect.

—Melanie Cohen

Quick Numbers Trivia

How many marathons are part of the World Marathon Majors?

Answer at the bottom.

Our Roundup

Our experts touched on a wide range of topics, from global tax administrations to cryptocurrency as compensation. For a look at what’s making news, here’s our roundup.

Global Economies

During the Covid-19 pandemic, tax administrations have dramatically increased the pace of digital transformation. But tax authorities around the world still have plenty of work to do, says EY Global’s Arnauld Bertrand in Covid-19 Showed Why Tax Administrations Need to Be Proactive.

In Indian Court Issues Significant Tax Ruling from M&A Perspective, Sanjay Sanghvi and Rahul Jain of Khaitan & Co. discuss a recent case in which an Indian court has held that no income tax is payable on consideration for sale of shares withdrawn from an escrow account.

Global expansion offers companies a way to gain entry in new markets, but it requires proper research. In How to Ensure Market Entry Strategies Are Ready for Global Expansion, Safeguard Global’s Raj Inda shares steps to help companies navigate the tax and compliance complexities of going global.

The tax authority of the United Arab Emirates has announced that it will introduce a corporate tax on businesses in 2023. In Corporate Tax in the UAE—Are You Ready? (Part 1), Parwin Dina of Global Tax Services and Varun Chablani of GTS Africa look at the new regime and consider some of the questions and issues that may arise for businesses.

Federal Issues

Most taxpayers are able to take advantage of net operating loss deductions to offset taxable income in other tax years. In Net Operating Losses—Policies, Effectiveness, and Alternatives, Nixon Peabody LLP’s Patrick M. Cox, Brian Kenney, and Myra A. Benjamin explore whether NOL policy is effective or whether there are better alternatives.

The Build Back Better Act includes a provision that would add Section 163(n), which would limit the tax deduction for interest expenses that exceed interest income to an “allowable percentage” that equates to 110% of the excess. In Adding Section 163(n) Would Mean a Sea Change for Businesses, Mazars’ Tifphani White-King professes the need to be cautious about enacting policy that removes incentives for successful businesses to operate and invest in the US.

State and Local Tax

Sales and use tax collections represent the second-largest revenue source for state and local governments. In Unraveling the Revenue Sourcing Rules for Sales and Use Taxes, Kroll’s Robert Peters shares how companies and states are struggling to determine which goods and services are subject to tax and how to source these sales for both sales and use and income tax purposes.

Cryptocurrency

Compensating employees with cryptocurrency raises many of the same tax issues as compensating employees with employer stock. Therefore, it requires thoughtful planning on the part of both the employer and the employee, says Blank Rome LLP’s Dan Morgan in Cryptocurrency as Compensation: A Tax Primer.

A Closer Look

While the breadth and depth of how and if companies embrace ESG varies significantly by industry and company, many companies are moving toward more sustainable business practices. Given this change, companies need to reevaluate the value drivers of their business to determine if they need to modify their transfer pricing policies, say KPMG’s Jessie Coleman and Jack O’Meara in the latest edition of “A Closer Look.”

Columnists

The economy is cooling off, but retailers want to keep back-to-school shopping hot. And back-to-school spending is on the upswing despite the pandemic. With some schools just letting students out, the back-to-school projections aren’t out yet for 2022. But states, understanding that retailers are competing with online sales, are trying to keep shoppers local. One of the ways they do it? Sales tax holidays. Kelly Phillips Erb takes a look at states’ sales tax holidays for the rest of the year.

The conversation about the housing boom is also popular right now. Many homeowners hope to take advantage of rising prices before the market slows—or pops. So what are the tax consequences of selling your home? Phillips Erb shares answers to some of the most popular questions she’s received.

New Faces

Andrew Leahey is a programmer turned tax attorney turned columnist. Prior to joining Bloomberg Tax as a columnist, he ran his own technology company and practiced public finance and tax law. When he’s not writing, you can find Leahey outside—either in the Pine Barrens or at his Poconos cabin, with his wife, daughter, and at least one of his five dogs in tow. He enjoys birding, hiking, and playing baseball.

Follow Leahey on Twitter or read his most recent article on the argument for a data tax, courtesy of Elon Musk.

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. Here’s how to submit a response.

Listen In

A 2015 law promised to streamline the IRS’ method for auditing partnerships—a type of “pass through” business where the partners report their share of the proceeds on their personal tax returns. The Bipartisan Budget Act of 2015 had provisions that were supposed to make it easier for the IRS scrutinized partnerships.

In the latest episode of Talking Tax, Bloomberg Tax reporter Jeffery Leon speaks with Rochelle Hodes, principal of the Washington National Tax office at Crowe LLP, who says the law created new concerns and unintended consequences for those navigating the audit process.

Student Writing Competition

Do you have an original take on current events and issues in tax practice and policy—but you’re not yet a tax professional? Our second annual tax writing competition is the perfect opportunity to show off your work: The competition is intended to highlight the very best of student writing. The deadline is June 15, 2022.

Our Wish List

What’s on our Bloomberg Tax Insights wish list right now?

For June, we’d welcome thoughtful pieces on graduates. That includes taxpayer-advice-focused articles on what tax advisers are telling their clients who are just starting out in the workplace—approaches on withholding, pre-tax savings, etc.—and tax-favored strategies related to paying for higher education. It also includes advice for new grads hitting the tax and accounting job markets—what would you tell your younger self?

We’re also looking for tax pieces focused on travel and tourism. Specifically, we’d love to see how advisers and planners suggest taxpayers maximize tax benefits for vacation and rental homes, including estate planning techniques. And as state and local governments take a second look at Airbnb and related companies, we’d appreciate updates on those tax laws as well as strategies for keeping those taxes to a minimum—the same applies to other kinds of tourism-related taxes. And finally, with remote work still being a hot topic, pieces addressing what workplaces should know about “work anywhere” policies are welcome, especially as they apply to cross-state and cross-nation borders.

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 by email at [email protected].

Get Caught Up

It’s been a busy week in tax news from the states to Washington. Here are some of the stories you might have missed from our Bloomberg Tax news team.

*Note: Your Bloomberg Tax login will be required to access Bloomberg Tax news.

Tighter ethics regulations are holding back the growth of EY’s lucrative consulting business, a key reason firm leaders are considering whether to separate its global audit and advisory practices.
Treasury and IRS should issue regulations to clarify research and development requirements that were changed under the 2017 tax law, the American Institute of CPAs’ Tax Executive Committee said in comments released Tuesday.
As tax-cut fever continues to race through state capitols, two surging, related themes with long-term implications for state finances are emerging: flat taxes and targeted tax relief on retirement income. Arizona, Georgia, Iowa, and Mississippi have all committed to flat income tax systems in recent weeks, and Oklahoma is likely to join the club soon.
Florida Gov. Ron DeSantis’ clash with Walt Disney Co. over the state’s restriction on LGBTQ issues being taught in schools could end up costing Florida taxpayers $1 billion to $2 billion, a group of residents said in a revised lawsuit.
The IRS created a new role to help tackle its customer service woes, a position that will advise the chief taxpayer experience officer.

Spotlight

Our Spotlight series highlights the careers and lives of tax professionals across the globe. This week’s focus is on Bill Colgin, a partner at Holland & Hart LLP who litigates complex, high-stakes federal tax controversies and tax litigation.

Upcoming

This tax season has been, well, taxing. But now that it’s over, maybe you can use that extra energy for the Bloomberg Tax Insights Virtual 5k. Run, walk, or run/walk 5k (that’s 3.1 miles!) any time between June 6 and June 12 to support a great cause. For the second year in a row, we’re donating the proceeds to World Central Kitchen, which works to fight hunger around the world and is serving meals to Ukraine families in need. Sign up here.

Career Moves

Oliver Rosenberg, a partner in Linklaters’ Düsseldorf office, will be the new global head of tax, according to the firm.

Dominic Bédard-Lapointe has joined McCarthy Tétrault as a partner in the national tax group in Montreal, the law firm said.

Stefan Smith has joined Baker & Hostetler LLP’s tax practice group and employee benefits and executive compensation team as a partner in Dallas, the firm announced .

Karine Philippon has been appointed Mazars’ office managing partner in Los Angeles, the firm announced.

Michael Cardella, Jay Cosel, and Robert Stevenson have been promoted to tax counsel in Skadden, Arps, Slate, Meagher & Flom LLP’s Washington, D.C., and New York offices, the firm announced.

Quick Numbers Answer

The Abbott World Marathon Majors comprises six marathons: the Tokyo Marathon, Boston Marathon, London Marathon, Berlin Marathon, Chicago Marathon, and New York City Marathon. That’s 157.2 miles!

Peres Jepchirchir of Kenya crosses the finish line to take first place in the professional women’s division during the 126th Boston Marathon on April 18, 2022, in Boston.

Photographer: Maddie Meyer/Getty Images

Be Social

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’ll join the conversation!