Talk Back

By Arden Dale
   A DOW JONES NEWSWIRES COLUMN

Drink, drive, crack up the car…and write off the damage on your tax return. For one taxpayer, that scenario became reality after he appealed a decision by the Internal Revenue Service.

The U.S. Tax Court last week allowed the driver of a car to write off thousands of dollars of damage after he totalled it while under the influence.

While it’s not unusual to deduct property damage (this is claimed as a casualty loss deduction on Form 4684), the circumstances of the case–which required a judge to decide if the driver was or wasn’t willfully negligent–set it apart.

It also shows that disgruntled taxpayers can challenge the IRS, and win, on some pretty odd cases.

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These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

The Internal Revenue Service is suspending tax rules for Citigroup and other TARP recipients to permit those companies to more rapidly pay back the Treasury what they owe in TARP loans, and to their boost stock prices.

For Citigroup, that means an additional $38 billion in tax deductions to help the beleaguered company pay the Treasury the $20 billion it owes the TARP. In addition, these breaks will juice Citigroup, GM and other TARP recipients’ stock prices, and make TARP’s huge equity positions more valuable.

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By Arden Dale 
A DOW JONES NEWSWIRES COLUMN 
 
NEW YORK (Dow Jones)–Zurich to Panama City, first class. That will likely be a simple travel itinerary for people trying to do something not so simple: Move their hidden money out of Switzerland.

In the turmoil over tax evasion and UBS AG (UBS), many other banks, including Credit Suisse (CS) and LGT Bank, are shedding American customers with undeclared accounts. It is leaving these people with the problem of moving a lot of money to some other place or declaring it to the Internal Revenue Service themselves.

Finding a new hiding place won’t be hard. Panama, the Cayman Islands, Dubai, Singapore and Hong Kong are among prime destinations for tax evaders, despite a push by global authorities to change that.

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