Given that it’s tax season and many Americans will be reaching into their pockets to settle what they owe to the government, the timing of a new inspector general report seems appropriate. U.S. Taxpayers are probably not going to be thrilled to learn that a report released on April 8, 2026, by the Treasury Inspector General for Tax Administration (TIGTA) shows that the Internal Revenue Service (IRS), despite having a program in place to assess taxes on foreign financial assets held in offshore accounts held by American citizens, performed a shockingly low number of examinations and applied even fewer penalties.
If that’s not enough to make individual taxpayers grumble, the IRS also disagreed with almost every aspect of the three recommendations made in the TIGTA report to assess and improve the Foreign Account Tax Compliance Act (FATCA). The Internal Revenue Code provisions that allow IRS employees to target nonfilers, underreporting, and noncompliance from offshore private banking accounts. Despite this, TIGTA found that the IRS has spent almost $683 million administering FATCA overall, while Campaign 896 targeted about $6.2 trillion in offshore balances but produced only about $41 million in additional tax and penalties, and left roughly $4 million in potential Form 8938 penalties unassessed.
For those scrabbling to make their payments each tax year, the failure of IRS management and the Department of the Treasury to punish those abusing the tax system is beyond maddening. Why is FATCA, which allows federal agencies to hold tax scofflaws responsible, failing so badly? And can it be saved?
Introduced in 2010, FATCA was intended to narrow the Tax Gap by making the offshore accounts of U.S. taxpayers more transparent and accountable to tax laws. Specified foreign financial accounts that met or surpassed a certain threshold were required to file Form 8938, Statement of Specified Foreign Financial Assets, with their income tax return. Failure to do so resulted in a failure-to-file penalty of $10,000 per month, with a maximum of $60,000 in fines per year. It was believed that FATCA would generate around $8 billion in revenue over the fiscal years 2010-2020.
Things did not go as hoped. A 2018 TIGTA report found that the IRS repeatedly failed to follow up on failure-to-file violations and cases showing underreported income. In addition, some records from Foreign Financial Institutions (FFIs) failed to include correct Social Security or Taxpayer Identification numbers. As a result, the IRS launched the Offshore Private Banking Campaign (Campaign 896) in 2019. The Large Business and International (LB&I) Division, which oversees FATCA administration, was put in charge.
Campaign 896 was intended to identify qualifying accounts that failed to file Form 8938, assess the $10,000 fine for noncompliance, and open an examination to determine if additional taxes were owed by the account holder. While the information reporting aspect of Campaign 896 worked as expected, the use of additional actions to apply penalties and collect additional taxes from offshore accounts during the filing season came up short. Way short.
Of 164 taxpayers with accounts at foreign financial institutions referred for examination for either ignoring reporting requirements, having discrepancies on their income tax returns, or not bothering to file any taxes with the federal government, only 12 were actually examined. Five paid a combined total of just under $40 million in tax revenue, with another $80,000 in non-filing penalties. For these 164 noncompliant taxpayers, the average unreported foreign account balance was about $1.3 billion each.
It gets worse. There were 241 other noncompliant taxpayers who had income over the legal threshold but failed to file, with an average of $377 million in their accounts. 225 were sent an “educational” letter that required no action on the taxpayer’s part. The remaining 16 received a so-called “soft letter,” which did require a response. Under the Campaign 896 policy, those who don’t comply are to be referred for an examination. Despite receiving no responses, this did not happen in any of the cases.
In addition to its findings, the TIGTA report provided suggestions to improve FATCA results. Despite the marked failures to date, the IRS was less than enthused about the proposed policy changes.
Believing that the methodology behind FATCA is sound, TIGTA suggested that the IRS make three changes to the existing system. These were:
Aside from agreeing to evaluate the possibility of using 1099 data, the IRS disagreed with all of TIGTA’s attempts at the modernization of Campaign 896. It also questioned the assertion that the agency had left close to $4 million uncollected by failing to assess failure-to-fine penalties on identified noncompliant taxpayers.
In 2025, the IRS saw more than half its budget slashed by the Trump administration, along with massive reduction-in-force (RIF) firings that included 742 agents from the LB&I division. This, along with the agency’s current stance that it’s the legislation, not the enforcement, that's flawed, makes it unlikely that FATCA revenue will experience any significant upswing in the near future.
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]]>Georgia’s maternal mortality rate is among the highest in the country, with Black mothers more than three times as likely to die from pregnancy-related causes compared with white mothers. The state also fares poorly on measures such as severe maternal morbidity and cesarean delivery rates.
Over half of all counties have either no or very limited access to maternity care, and more than one‑third of Georgia’s counties are classified as “maternity care deserts” (meaning they have no obstetric providers, no birth centers, and no hospitals offering obstetric services). Hospital closures and the elimination of labor and delivery units have been major drivers of these access gaps. In rural areas, only a little more than one‑third of rural hospitals still provide obstetric services.
Given that context, midwives, especially those who provide home and birth‑center care, say Georgia underuses a crucial part of its maternity care workforce.
Georgia has adopted some of the most restrictive midwifery laws in the country, licensing certified nurse‑midwives while requiring a separate state license for non‑nurse midwives. It is generally unlawful to practice midwifery in Georgia without one of those licenses.
Direct‑entry midwives (midwives trained outside of nursing programs who typically specialize in home and birth‑center deliveries) have no state licensure pathway in Georgia and risk criminal or civil penalties if they practice. Certified nurse‑midwives (advanced practice registered nurses with graduate‑level training in midwifery and authority to provide care for low‑risk pregnancies and related reproductive health services) may only practice under written “nurse protocol agreements” with physicians.
The midwives who brought the recent lawsuit claim that those physician‑oversight contracts often require monthly payments in the hundreds of dollars and can be difficult for midwives to secure, limiting when and where certified nurse‑midwives can provide care.
Georgia’s midwifery framework turns on two main sets of state rules: the “Midwifery Statute,” which governs non‑nurse midwives, and the “nurse protocol agreement” requirements that apply to certified nurse‑midwives as advanced practice registered nurses.
Under the Midwifery Statute, it is unlawful for a licensed midwife to “attend any cases other than those of normal childbirth.” “Normal childbirth” is defined by reference to a physician’s examination finding no specified abnormalities. This law also says that midwives must practice under a physician’s direction when complications arise.
For certified nurse‑midwives, Georgia law requires a written nurse protocol agreement with a physician. That agreement is a signed document in which the physician delegates specific “medical acts”, which can include ordering drugs, medical devices, medical treatments, and diagnostic studies, and must spell out the parameters under which those acts may be performed.
These rules did not appear in a vacuum. Over the past century, Georgia’s birth care system has shifted from relying heavily on traditional and Black “granny” midwives to a model in which only certified nurse‑midwives are licensed, and all other midwives are effectively excluded from legal practice through regulatory and licensing changes. While neighboring states like Florida and Tennessee created licenses for certified professional and other direct‑entry midwives, Georgia continued to bar those midwives from lawful practice and kept physician‑agreement requirements in place for certified nurse‑midwives.
Against that backdrop, the lawsuit spotlights three midwives whose careers illustrate how Georgia’s rules play out on the ground.
Jamarah Amani is a Florida‑licensed, direct‑entry midwife and executive director of the Southern Birth Justice Network. She says a traumatic hospital birth in Georgia and the lack of any lawful pathway for community midwifery pushed her to train and practice in Florida instead, even though families in Georgia still ask her to attend their births.
Tamara Taitt, also a Florida‑licensed, direct‑entry midwife, now leads Atlanta Birth Center. She says Georgia’s refusal to license direct‑entry midwives forces experienced midwives into “birth assistant” roles and limits how many patients the center can safely serve.
The third plaintiff, certified nurse midwife Sarah Stokely, lives in Rome, Georgia, but drives more than four hours to work at a Tennessee birth practice because she cannot afford the physician protocol agreement she would need to practice as a midwife at home. Instead, she works in Georgia as a registered nurse while maintaining housing in two states to keep attending out‑of‑hospital births.
Together, the three describe careers built around low‑risk, community‑based maternity care—and a pattern in which Georgia law cuts that work off at the state line.
The lawsuit, filed in the Superior Court of Fulton County, brings only state law claims under the Georgia Constitution. The defendants are the State of Georgia itself and Georgia officials who enforce the midwifery and nursing laws, including the Georgia Board of Nursing and the Department of Public Health.
The plaintiffs say Georgia’s midwifery scheme violates the right to pursue one’s chosen profession by shutting non‑nurse midwives out of practice and making nurse‑midwives’ ability to work depend on private physicians’ approval.
They also raise equal protection claims, arguing that the state treats midwives differently from comparable providers and burdens patients who want out‑of‑hospital births without a safety‑based rationale. On top of that, they assert improper delegation of governmental power to private actors and due process violations, including vagueness, on the theory that key terms and requirements are too unclear to give fair notice.
The plaintiffs ask the court to declare core midwifery and nursing provisions unconstitutional and to bar their enforcement. Those changes would open a legal path for direct‑entry midwives, let certified nurse‑midwives practice without having to buy physician sign‑off, and could eventually draw in Georgia’s appellate courts and even the Supreme Court if the case advances far enough.
This case is not just about three midwives and some technical licensing rules; it is about whether Georgia will keep treating community‑based midwifery as something to be pushed out or as part of the solution to its maternal healthcare crisis. A win for the plaintiffs could open legal pathways for direct‑entry midwives and give certified nurse‑midwives a way to practice without obtaining physician permission, which, in turn, could make home and birth‑center care a real option for more Georgians. A loss would leave the current system in place — and leave midwives and the patients who want their care working around the same barriers described in the lawsuit.
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]]>Can investors count on a comfortable retirement funded by investments in cryptocurrency, private equity, and real estate? The Trump administration seems to think so. Whether Americans who depend on their 401(k) plans for financial security in their golden years will agree remains to be seen.
On March 31, 2026, the U.S. Department of Labor released a Notice of Proposed Rulemaking (NPRM) entitled “Fiduciary Duties in Selecting Designated Investment Alternatives.” Drafted by the Employee Benefits Security Administration (EBSA), the proposed rule seeks to expand access to investing in alternative assets by reducing the litigation risk fiduciaries could face when their investment decisions are challenged. It would do so by adding a new prudence framework under ERISA's fiduciary duty rules. It would use six factors to act as guidelines for investment managers and 401(k) plan fiduciaries.
Alternative investment options were the focus of President Trump’s Executive Order 14330, issued by the White House in August 2025 to roll back safeguards put in place during the Biden administration. Intended to boost the inclusion of digital assets and other asset‑allocation funds for 401(k) investors, it comes at a time when private credit investing faces serious concerns about its illiquidity. The rule may indeed become law at some point, but there’s doubt whether retirement plan participants will be eager for higher‑risk private‑market investments.
Social Security is intended to be a supplement rather than a sole source of income, which means future retirees should try to save as much money as possible. There are many types of retirement savings, but employer-sponsored 401(k) plans are the most common. Employers may make matching contributions in a safe-harbor 401(k) plan. Employee deposits can be automatically deducted from their salary and are usually tax-deferred. Many defined-contribution plans are participant-directed, which allows investors to choose how much risk they’re comfortable with.
Intended to provide a return on investment over decades rather than months, 401(k) plans have traditionally favored index funds in the stock market. These generally offer steady, low-risk returns, allowing the retirement plans of 401(k) savers to accrue significant gains over a long period. This system provides substantial tax breaks on lifetime income for the investors.
Alternative asset investments were available before the issuance of EO 14330, but hadn’t found wide acceptance or usage. Often more sophisticated, volatile, and risky than established index funds, they left fiduciaries and plan managers open to litigation from investors dissatisfied with substandard returns. The DOL’s proposed rule aims to give plan fiduciaries more comfort in offering alternative‑asset exposure in 401(k)s, but it’s unclear whether that will increase participants’ interest in investment alternatives.
As currently written, the DOL’s proposed rule removes perceived barriers for fiduciaries to consider alternative investment options, such as private equity and crypto. Fiduciaries are required to meet ERISA’s duty of prudence under the Investment Duties Regulation, which essentially says that they need to fully understand the investment opportunities and act accordingly.
The proposed regulation’s framework asserts that ERISA gives “maximum discretion and flexibility to plan fiduciaries in selecting designated investment alternatives.” This, it contends, means that “arbiters of disputes should defer to fiduciaries under a presumption of prudence.” The wording suggests that courts and mediators should assume the fiduciary acted in good faith toward their investors, provided they followed the guidelines set forth in the proposed rule. However, plan participants can still sue for breach, even if the fiduciary believed it acted in good faith. Compliance with a regulatory framework can be relevant evidence in a lawsuit, but it is not automatic immunity. It may reduce litigation risk, but it doesn't eliminate it.
So, what’s in that process intended to insulate fiduciaries? It’s comprised of six factors that must be assessed and considered in decisions about potential investment opportunities. Let’s take a look at each of them.
Fiduciaries should not be afraid to consider and implement sophisticated investment opportunities, as long as they feel that they fully understand the complexities involved. If a fiduciary doesn’t think they fully grasp the intricacies of the investment, they should consult with someone who does.
The determination of whether they have the required understanding of the risks an investment presents is fully at their own discretion. There is no safe harbor requirement to seek assistance from a financial expert if the fiduciary believes they have sufficient knowledge.
Fiduciaries have the latitude to select investments that don’t have the lowest possible fee. The proposal states that the fiduciary would not be responsible for comparing the fees and potential returns of every similar investment opportunity available, but instead must consider a “reasonable number of similar alternatives” in the market.
While fiduciaries must deliver on any promises they make about the ability to provide investors with actual funds when requested, they don’t need to offer full liquidity for plans that include alternative investment options. The proposed rule suggests that younger workers with longer investment horizon timelines better “fit the profile of an investor who can benefit from a liquidity premium.”
When considering alternative investment options, a fiduciary should consider more than expected returns. This includes fees, expenses, risk factors, and the investment horizon of the participants.
Meaningful performance benchmarks for alternative investments should be based on their historical performances. If one doesn’t exist, fiduciaries should use the history of a similar type of investment to replace the need for a meaningful benchmark. The rule states, as an unassailable principle, that no single benchmark is meaningful for all designated investment alternatives on a plan investment menu.
Fiduciaries must assess the valuation of potential alternative investments and ensure that measures are in place to meet the fund’s participants' needs. While stock index funds and some alternative assets are regulated by the Securities and Exchange Commission (SEC), the proposed rule gives fiduciaries the leeway to consider securities traded on a non-public market if they are valued by an “independent, conflict-free” process on a quarterly basis. They also retain the power to adopt “alternative valuation procedures” if a “temporary emergency” arises, as long as they act in good faith.
If the proposed rule becomes law, fiduciaries who manage their clients' accounts under these factors would be less likely to face litigation from their clients for risky choices involving alternative investments like non-fungible tokens (NFTs) or crypto.
The proposed rule for the fiduciary process is open for public comment until June 1, 2026. After the public comment period is over, the DOL and the EBSA can modify the rule, withdraw it, or proceed to a final rule. This requires at least 30 days and a review by the Office of Management and Budget (OMB) before it is finalized and published in the Federal Register.
Passage of the proposed rule does not guarantee that fund managers will immediately begin adding real estate and private equity assets to their clients’ 401(k) portfolios. Financial institutions and professionals tend to favor low-risk investments for retirement funds, especially after the 2008 financial crisis. They’re also likely to see how the new rule holds up in court if enacted.
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]]>Artificial intelligence is transforming the typical workday in a variety of industries. The Internal Revenue Service (IRS) is no different. For years, the agency has been working with Palantir Technologies to better process tax returns and identify potential audit candidates.
While the IRS is still a relatively large agency, the number of tax returns it must process every year is staggering. In addition, the IRS has significantly fewer employees than a decade ago, particularly in enforcement roles like revenue agents. The IRS has never been able to audit all tax returns with potential issues, and its workforce reduction has led to audits at near-historic lows. Unsurprisingly, then, the IRS is increasingly focusing on audits that have the “highest value” (i.e., audits that will result in the IRS getting the most money).
That’s where AI and Palantir come in. Co-founded by Alex Karp and Peter Thiel, Palantir provides numerous data-integration and analytics platforms to government agencies worldwide. Federal agencies are Palantir's largest customer group, with government contracts accounting for approximately half of its revenue. It has long provided the government with data platforms for counterterrorism and border security operations in the U.S. Earlier this year, the Department of Homeland Security awarded Palantir a five-year contract worth up to $1 billion.
Now, according to reporting in Wired, the IRS is exploring an increasing role for the data analytics giant in processing tax returns, conducting criminal investigations, and conducting audits.
The Selection and Analytic Platform (SNAP) is an AI tool meant to identify the highest-value cases for audits. It is currently part of a pilot program designed to streamline information from over 100 separate business systems. The idea is to let IRS analysts see relationships across taxpayers, entities, assets, and transactions.
This is not the first time the agency has partnered with Palantir. All told, Palantir has been awarded IRS contracts worth approximately $200 million since 2014. The IRS awarded up to $11.8 million in January 2025 for the SNAP program and other Palantir tools, and recently allocated just under 10% of that budget to enhance SNAP’s capabilities.
Not necessarily, and not this year in particular. It is still in its pilot program phase. Even if SNAP use expands, it’s likely the main focus will remain on large-scale fraud, not on expanding random audits of taxpayers. The IRS intends to use Palantir’s platforms to identify patterns and connections that would be hard to spot manually, like transaction flows that suggest tax evasion schemes.
This could mean analyzing transactions on payment apps like Venmo, among numerous other potential transactions. The IRS would already need to possess all the information SNAP uses. The contract specifies that SNAP can only analyze existing data.
Historically, the IRS has used the Discriminant Information Function (DIF) score to determine whether a tax return should be audited. No one outside of the IRS knows how the DIF score is calculated (to avoid helping taxpayers game the system), but it appears the IRS will use SNAP alongside existing systems like DIF, not replace it.
The benefits the IRS sees in streamlining the process to determine which returns to audit seem straightforward. However, some privacy advocates are warning about the risk of increased financial surveillance. Concerns are always raised when the federal government is using algorithms to compile data on Americans. So, is this simply a modernization effort by the IRS to get rid of obsolete legacy systems? Or is it a red flag suggesting an increasing creep toward a surveillance state?
As with the DIF, the IRS’s use of SNAP is essentially a black box. It’s not clear if the IRS is on a path to create a de facto searchable “mega database” that could be used to compile extensive federal records (or even quasi-public transaction data) on American taxpayers. Even if not, there is concern that SNAP may violate the Privacy Act of 1974.
On the other hand, previous modernization efforts at the IRS have had mixed success, largely because the IRS, despite being a nonpartisan institution, often has its priorities shifted by the current administration. The Trump administration has embraced the use of AI and other technologies across all aspects of government, but future administrations may be more leery of working with tech leaders such as Peter Thiel and Elon Musk. Musk headed the Department of Government Efficiency, which kept a hiring freeze at the IRS and had 17,500 workers leave under deferred resignation programs.
For now, it remains to be seen how much the IRS will integrate Palantir tools into its existing processes.
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]]>You might think that most workers are protected when they take time off with the flu or other illnesses. But actually, it’s not as straightforward as it may sound. FindLaw can help you sort through the nuances and variations behind the frequently asked question: “Does my employer have to give me sick leave?” To get a useful answer, it helps to break down the question into smaller parts.
There are generally two types of sick leave: paid and unpaid. Many major federal protections, such as the FMLA, apply to unpaid, job‑protected leave, while some state and local laws also protect certain paid sick time.
However, even if unpaid, you generally do not have a blanket legal right to stay home whenever you feel unwell. Outside of specific protections, an at‑will employer can treat unapproved absences as a disciplinary issue. The exceptions can include serious health‑condition leave, state or local sick leave laws, disability‑related accommodations, or contract/union rights.
When a sick leave or leave law does cover you, employers usually cannot punish you for using that protected time. Federal laws like the FMLA and numerous state and local paid sick leave laws prohibit employers from disciplining or retaliating against employees for taking legally protected leave, including treating that leave as an ‘occurrence’ under a no‑fault attendance policy.
Sometimes. It helps to know whether your sick time is covered by law or by the employer's written policies or promises in a handbook or contract. Regarding the former, that kind of requirement doesn’t come from one single national rule. Instead, it’s built from a patchwork of federal laws for certain kinds of medical and family leave.
There are some laws and regulations that force employers to provide paid time off (PTO). However, workers generally receive more legal protections for unpaid time off. Examples of unpaid sick leave laws include the Family and Medical Leave Act (FMLA), as well as state and local sick‑time laws that apply only in specific places and to certain employers.
As far as PTO, Executive Order 13706 requires many employers on covered federal contracts to provide paid sick leave to eligible workers. (Note that EO 13706 does not apply to ordinary federal government employees; it applies to employees of certain federal contractors and subcontractors working on covered contracts.)
If you want a deeper dive into how general leave laws work and when longer medical or family absences are protected, see our Guide to Leave Laws. For more on how employers commonly structure vacation, sick days, and PTO as benefits, and how those sick leave policies interact with state rules, see our article on Vacation and Sick Leave.
What if none of these laws apply to your situation, but your employer has chosen to offer sick days? Does that mean the employer can revoke or amend its sick time policy at will? Not necessarily. A statute might give you a right to sick time that your employer can’t take away, but even without a statute, an employer that clearly promises certain benefits or procedures can sometimes be held to those promises.
Courts in many states look at what an employer put in writing and how consistently it followed those rules when deciding whether employees can rely on them. Under some state laws, clear promises in a handbook or policy (like a set number of sick days, a discipline process, or “just cause” standards) can become an implied contract enforceable against the employer, especially if there’s no strong disclaimer reserving the right to change or ignore the policy. The fine print in your handbook can therefore significantly affect what your employer is legally required to do: for example, language stating it is “not a contract” and may be changed at any time. In addition to handbooks and individual contracts, a collective bargaining agreement can also define your rights, including rules for sick leave, unused‑time payouts, and related procedures.
When you’re sick, the length of time you need off matters just as much as why you’re out. A single day at home with a bad cold is very different, legally and practically, from several weeks off after surgery or for a serious health condition.
For short‑term illnesses, whether you can stay home (and get paid) often depends on your employer’s own sick leave or PTO policy, plus any state or local paid sick time rule where you work. If you’ve accrued paid sick time under a state law or company policy, you may be able to use it in small increments for minor illnesses, preventive care, routine medical care, or other basic health care needs. If there’s no law and no policy, though, your employer may be free to treat a short sick day as an unexcused absence.
Longer stretches of time off (think weeks or months) tend to fall under a different framework. Instead of “sick days,” you may be looking at medical or disability leave, such as unpaid sick leave that is job‑protected, a state family‑leave or disability program, or a private short‑term disability plan. These systems usually apply only if you meet eligibility rules and have a qualifying serious health condition, not just a routine virus. But if you do qualify for one of these leaves, you can use it not only for yourself, but also to care for a family member or domestic partner. In some states, this protection extends to time off for reasons related to domestic violence.
Paid versus unpaid time can also flip as the duration changes. Some workers can cover the first days of an illness with accrued paid sick time or PTO, then shift to unpaid but job‑protected leave, or to partial wage replacement through disability benefits. Others may have no legal right to pay, even when the law protects their job. Understanding which bucket your situation falls into (brief sick day, extended medical leave, paid, unpaid, or some combination) helps you figure out what you can realistically ask for and what the law may actually require. You generally don’t get different rights based on whether a medical condition is a physical illness or mental health-related. What matters is whether it meets the legal standard for a qualifying health condition under the specific leave law.
Employers also often want some proof that you were really sick, especially for longer or repeated absences. They may ask for a doctor’s note or proof of a medical appointment, but they shouldn’t share your information or medical diagnosis beyond those who need to know.
Knowing which rules apply to you—and which don’t—is the first step to answering whether your employer really has to let you stay home when you’re sick. If you’re facing discipline or denial of sick leave and want advice about your options, consider speaking with an employment law attorney in your area.
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]]>Taxpayers who purchased a new vehicle in 2025 can look forward to a new tax deduction on their next tax return. This new tax benefit allows taxpayers who bought and financed a qualifying vehicle after December 31, 2024, to deduct up to $10,000 of car loan interest from their taxable income.
This new car loan deduction is effective through 2028.
No, only new vehicles that meet certain criteria qualify for the tax deduction. Used vehicle loans are not eligible. Qualifying new vehicles must:
To verify a vehicle’s final assembly, use the National Highway Traffic Safety Administration (NHTSA) VIN Decoder. All you need is the vehicle label at the dealership and the vehicle identification number (VIN).
Not all taxpayers are income-eligible for the full auto loan deduction. Filers must have a modified adjusted gross income (MAGI) of less than:
Keep in mind that your MAGI is what’s left after certain deductions, like student loan interest and eligible retirement contributions. This means even high earners may still be eligible for the deduction.
The Internal Revenue Service (IRS) also phases out the deduction gradually—so even if you exceed the income limits above, you may still be able to deduct some of your auto loan interest. For every $1,000 above the MAGI limit, the deduction shrinks by $200. For example, a single filer with a MAGI of $120,000 would see their allowable deduction reduced by $4,000.
The deduction is available regardless of whether you itemize or use the standard deduction.
The Trump Administration’s Big Beautiful Bill introduced other tax savings as well. Other changes, in addition to the auto loan interest deduction, boosted take-home pay for some filers and simplified how certain types of income are taxed.
Other notable updates taxpayers can benefits from in the 2025 and 2026 tax years include:
On the flip side, some clean‑energy credits were eliminated or phased out. Credits for electric vehicles are no longer available for vehicles purchased after September 30, 2025. Tax year 2025 was the last year homeowners could receive a 30% tax credit for rooftop solar, geothermal heat pumps, or battery storage.
The auto loan interest deduction and other changes give many taxpayers new ways to lower their tax bill in 2025 and beyond. As always, staying aware of which rules apply in which tax year can help you make the most of every new credit and deduction available. It also doesn’t hurt to have a good tax professional on your side to help maximize your savings.
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]]>A cornerstone of the second Trump administration's economic policy agenda suffered a defeat when the U.S. Supreme Court held that Congress did not authorize President Trump to impose tariffs unilaterally under the International Emergency Economic Powers Act (IEEPA).
The ruling left undecided what would happen to the tariffs that businesses have been paying. That question has now largely been resolved, although more legal developments are expected, and the situation remains complicated.
On March 4, 2026, Judge Richard Eaton of the U.S. Court of International Trade (CIT) ordered the U.S. government to remove IEEPA tariff duties from future entries and to refund duties on unliquidated and not-finally-liquidated entries to all affected importers of record.
In plain English, that means Customs and Border Protection (CBP) must stop adding the now‑invalid IEEPA tariffs when it finalizes new import entries and must go back and fix entries that are still “open” in its system. This includes importers who never sued the administration, which was a major open question. However, while the order requires CBP to remove IEEPA duties from unliquidated and not‑finally‑liquidated entries, it does not yet provide a clear automatic refund path for entries whose liquidation is already final.
If you’re left a bit confused, that’s understandable. The bottom line for importers is that if the protest period for the tariffs you paid has passed, a call to a lawyer is a good idea. If it hasn’t, you should be eligible for an automatic refund … but a call to your lawyer probably wouldn’t hurt.
With over $130 billion in collections by CBP from an estimated 300,000 importers, implementing a refund process may prove daunting. Nonetheless, Judge Richard Eaton, who will remain the only CIT judge to hear cases related to this ruling, indicated that the existing CBP liquidation process should prove up to the task.
This decision does not mean that businesses will no longer need to pay tariffs, even as they receive refunds on tariffs they’ve already paid. That is because President Trump invoked Section 122 of the Trade Act of 1974 to reissue unilateral tariffs in the wake of February’s Learning Resources Inc. v. Trump ruling. Unsurprisingly, the Trump administration was again hit with a lawsuit in the CIT challenging the viability of his use of Section 122. Attorneys general from 23 states filed the legal challenge to the latest round of tariffs.
While President Trump was involved with tariffs during his first term, he made it clear they would be the centerpiece of his fiscal agenda in his second administration. Claiming that IEEPA gave him the authority, President Trump issued executive orders imposing and altering import tariffs. The rates were in constant flux, often reflecting his disposition toward a particular nation at the time. For example, the rates on goods imported from Canada and Mexico rose and fell in seeming accordance with how relations were with their leaders at any given moment.
The tariffs generated under IEEPA were taxes imposed on importers in the United States. While import tariffs are nothing new, the often hefty rate increases made it challenging for many businesses to pay what they owed to receive their goods.
The two-step process for imported materials begins with importers paying an estimated amount to CBP for what they’ll owe at entry. It concludes with CBP conducting liquidation, which assesses if the importer is due a refund within about 314 days. The inflated rates and uncertainty around import tariffs in 2025 forced businesses to either absorb the increased costs or pass them along to their customers. Reluctance to opt for the latter sometimes left smaller businesses open to scammers and grifters, as they struggled to raise the funds to have their items released.
Atmus Filtration, which claimed it paid $11 million in IEEPA global tariffs, was the plaintiff in the case decided by the CIT. CBP requested four months to develop a plan to facilitate $130 billion in returns, but Judge Eaton suggested that the agency was already well-versed in the liquidation process. The ruling indicated that the refunds were expected to include interest on the wrongly collected tariffs, which makes the CBP’s task even more difficult.
As if that weren’t enough of a task, Judge Eaton also ordered CBP to finalize what the cost of bringing millions of shipments into the U.S. would have been if the tariffs hadn’t been assessed. While figuring out the liquidated entries is time-consuming, the expected appeal by the federal government may temporarily shelve the process. That’s not welcome news for importers struggling to stay afloat in the meantime.
The pending battle over President Trump’s pivot to Section 122 for his tariffs ought to be legally fascinating, as well. In defending President Trump’s IEEPA tariffs last year, the Department of Justice (DOJ) argued that Section 122 wasn’t an option because it “doesn’t have any obvious application” in affecting the trade deficit. However, Section 122 may provide President Trump with the legal support he needs to continue with his tariff campaign.
For small businesses impacted by tariffs, the promise of impending refunds is welcome news, even if any relief is unlikely to be a smooth process.
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]]>America is poised for a great ownership transfer, fundamentally reshaping the business landscape. A report by the McKinsey Institute for Economic Mobility issued at the end of February says that, as millions of baby boomers retire, the US will likely see an unprecedented wave of small-business ownership transitions. This “great ownership transfer” brings many challenges, but also many opportunities for the next generation and their communities.
Even the youngest baby boomers are approaching retirement age. The businesses they’ve spent their lives building, often family businesses, have strengthened our economy and brought their owners financial stability. Now, as those owners get ready to set down their responsibilities and enjoy their well-earned retirement, a new generation of business owners will need to take the reins.
Data shows that by 2035, about 6 million small- and medium-sized businesses currently owned by baby boomers will need to be transferred to new owners as their original owners retire. About one million of these are viable candidates for sale, representing nearly $5 trillion in enterprise value. Experts estimate that about 12 million jobs depend on them.
There is so much riding on successful business transfers. However, today in America, most exits end in business closure instead of transfer. That’s because the pathways for business succession can be extremely challenging and costly to navigate. Many existing owners find it hard to transfer their business to a new owner. And many entrepreneurs find it easier to start a new business for the first time than to acquire one.
Business transfers are more likely to be successful when their owners engage in something called business succession planning. This process (sometimes also called a buy-sell agreement, transition plan, or business continuity plan) creates a plan of action outlining what should happen to the business when the initial baby boomer business owner retires or is unable to continue running the business as it is today.
Succession plans are kind of like a prenup for your business. They envision the future and ensure that your business continues to run smoothly. To do so, they identify the right people to run things going forward.
A business succession plan may involve many things, including:
It’s possible to find many business plan templates online, including those from the U.S. Small Business Administration. However, the best way to create an effective business plan is most often to work with a experienced professionals, including a business and commercial lawyer, a certified public accountant (CPA), or a certified exit planning advisor. The professionals you hire, acting as trusted providers, can get to know your business, spot any potential pitfalls, or guide you through the planning process. They’ll help you avoid litigation, minimize tax burdens, and ensure accurate valuation of your business.
In choosing to do your own planning with online forms rather than a lawyer or financial professional, you can save money. But for those who view their business as a lasting legacy, or have higher income and employees, hiring professionals may be well worth the price.
In the United States, 99% of all companies are small businesses. Together, they employ almost half of the US workforce and generate 35% of business revenue. So, the McKinsey report comes with a warning. Many communities could be negatively impacted if businesses close rather than transfer ownership.
This is especially true in rural areas where small businesses account for more than half of total employment. If retiring small business owners fail to do proper exit planning, small town storefronts and agricultural businesses could wind up closed with nobody from the next generation taking them on. The impacted communities may never be the same.
The McKinsey report also reminds us that “ownership of a small business has long been one of the most powerful pathways to wealth creation in the United States. But, only 28% of the ownership transfer value from baby boomer-owned businesses is likely to go to women and Black and Latino individuals combined. If boomers choose their successors wisely, or if women and minorities think strategically about their opportunities now, those business transfers could be a powerful near-term lever to narrow geographic, gender, and race-based disparities in wealth.
Failed business ownership transitions do more than result in closures — they have the potential to change communities by taking away jobs and eroding wealth-building opportunities. In many places, especially in small towns and agricultural areas, ownership continuity means that businesses built by one generation will be passed to the next, and that the community will continue to become more vibrant over time.
But many business owners don’t have a succession plan yet. Generally, they cite many reasons for this, from not being able to identify a likely successor, to not knowing where to start and feeling uncertainty about the future.
So here’s the key question: Are you prepared for the future? It’s important to think through your exit strategy — whether that’s planning for a blissful retirement that you’ve been looking forward to for years, or planning just in case something were to happen.
Don’t just leave the decision-making responsibilities up to your family members or others who are currently employed by your small business. Take the time now to make the right decisions that are best for you, for your business, for the next generation and for your community. Make a formal succession plan that protects everything you’ve built. It’s important work, and it’s worth it.
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]]>A small business owner, facing financial difficulties and unable to get a loan from a traditional financial institution, turns to one of the countless solicitations they’ve been receiving from a different kind of lender. Desperate to acquire short-term cash flow, they agree to a deal with a predatory lender that includes harsh terms. Either weekly or monthly, they owe sizable payments that make it almost impossible to extract themselves from the financial quicksand they’re now mired in.
It sounds like one of the storylines from an episode of “The Sopranos,” but it’s actually a very real, quasi-legal problem. Small business owners, particularly ones that depend on imports affected by tariffs, may find it impossible to resist the deluge of offers they’re receiving.
Seizing on the vulnerability of small importers and those requiring components with origination sites outside of the U.S., an aggressive alternative to traditional lenders has emerged over the past few years. Merchant cash advance (MCA) companies offer business financing for companies unable to secure loans from banks or credit unions, but with repayment terms that could be considered usury.
Targeting small businesses reeling from tariffs and other financial headwinds, MCA lenders flood messaging apps with offers of the money they need in hours, not weeks. While the immediate debt relief is welcome, the restrictive terms and subsequent lofty payments demanded by their new service providers can make paying off the borrowed amount difficult, if not impossible.
Are the financial services offered by MCA lenders a scam preying on those with nowhere else to turn, or the evolution of underwriting large lump sums of money to overextended businesses with shaky credit scores? For companies borrowing from Peter to pay Paul, it likely feels like the former.
Small businesses that require items made in other countries have perhaps faced the most challenges in the past year. Tariffs are, in essence, a tax that the importing company must pay to take possession at the port of entry. When the tariff rate is low, companies may be able to absorb the cost without passing it along to their customers. Now, average tariffs have risen to the highest levels in decades, with some categories facing tariffs well above 100%. With sourcing within the country often too expensive or unavailable, small businesses are forced to pay an exorbitant dollar amount to claim their items.
While most small businesses would like to get a traditional business loan with a reasonable interest rate, that’s not always an option. The number of banks has decreased by nearly 66% over the past 45 years, and those still operating turn down close to two-thirds of small-business loan applications. Once owners have exhausted their credit cards, lines of credit, and personal guarantees, their options are severely limited. That’s where the MCA lenders come in.
MCA lenders come in a wide range of sizes and types of backing. Big companies such as Amazon and PayPal offer MCA services, as do firms backed by wealthy families and Wall Street investors. Others are less transparent about the source of their funding. One thing they have in common is turning an upfront infusion of cash into a lucrative, long-term source of income.
MCAs offer immediate financial relief at the cost of repaying the borrowed amount many times over. Instead of a traditional interest rate, MCA providers usually charge a factor rate, often in the 1.1–1.5 range, which can translate into effective annual costs that reach 40%–90% or more, and in some cases well above 100% once fees and short repayment periods are considered. Unless regulated by state law, MCA firms do not require a license to operate and have no fee cap on the services they charge.
An organized crime loan shark may have to worry about extracting payments from their clients. MCAs often bypass that complication by acquiring rights to future receivables. Each week (or even each day), an agreed-upon percentage of income from sales transactions is sent to the MCA firm, taken directly from the business’s bank account. For companies caught in a sales slump, this can lead to taking on additional MCAs to keep up with the first one. This is rarely a recipe for success.
The terms of some MCAs can make a loan shark seem compassionate. How can loans like this be legal?
There’s a simple reason why MCA loans aren’t subject to certain federal laws: they’re not structured as loans. MCAs are cash advances structured as purchases of future receivables. This is similar to a payday “loan” that is legally framed as a fee‑based advance rather than interest‑bearing credit. That structure allows MCA firms to sidestep many regulations that apply to term loans, including some usury limits and federal lending‑law protections.
The Consumer Financial Protection Bureau (CFPB) attempted to impose requirements on MCA lenders in 2023. Although a 2023 CFPB rule initially treated MCAs as a form of credit for reporting purposes, the Bureau later proposed excluding them, leaving many MCA practices outside federal reporting rules.
Companies in danger of collapsing under the financial burden of their MCAs previously had the option to try to refinance their debts through the Small Business Administration (SBA). However, SBA rules now bar using SBA 7(a) or 504 loans to refinance MCA debt. Protections against misrepresentation by MCA firms are available in some states, such as New York and California. It remains to be seen if the attorneys general in other jurisdictions will follow suit. Meanwhile, reading the fine print and fully understanding all terms and obligations on any MCA offer is essential.
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]]>The field of competitive figure skating is quite unlike any other, a world of quad axels, flashy costumes, and years of preparation that play out in the few minutes allotted for short programs and free skates (long programs). Whether on the ice alone or with a partner, part of what makes each performance unique is the skate music chosen. At this year’s Milan-Cortina Games in Italy, the Winter Olympic skating competitions have highlighted lingering music licensing and copyright issues that have persisted since a major policy change in 2014.
After grabbing headlines and looking like the beginning of an international brouhaha, U.S. figure skater Amber Glenn and Canadian artist and musician Seb McKinnon quickly put a potential music rights spat to rest. McKinnon, who performs as CLANN, created “The Return,” a song Glenn has been using in her program for the past two years. Controversy threatened to rear its head when McKinnon claimed Glenn hadn’t obtained permission to use “The Return” as part of her music after she won an Olympic gold medal with Team USA in the figure skating team event.
Fortunately, the issue between Glenn and McKinnon appears to have been resolved quickly and amicably. The specifics are not known at this time, but it is possible that increased recognition or compensation was involved. Regardless, the minor controversy has shed light on the copyright problems Olympians and other skaters still encounter with the music for their programs. While skating organizations insist they’re trying to help, some skaters are still having a hard time getting permission to use the music they want. It may have something to do with the unsettled and murky circumstances swirling around music copyrights these days.
In high-level competitions, figure skaters perform in one of two types of programs: short and free (also called long). The short program lasts 2:50 for synchronized skating and 4:00 for free skate. The programs are accompanied by music of the skater’s choice, usually intended to match the tempo and maneuvers of their routine or help tell a story.
In the Winter Games held before 2014, musical copyright issues were less likely to become public disputes. The ISU didn’t permit skaters to use music with vocal performances. Most skaters opted for classical music, which was often in the public domain and thus did not require permission, and obtaining a license when required from the orchestral recording was a little more straightforward. With the ISU easing its rules regarding what types of music could be used in 2014, things became more complicated.
There’s no one way to obtain permission to use music for figure skaters, reflecting the current chaos that defines the music industry. Determining who has the right to grant permission to use a song can be difficult, and compositions owned by multiple people or entities make it even trickier. This is further complicated by some works having different rights holders for different platforms.
Add to the mix that some skaters use a program featuring multiple pieces of music, all of which require permission for use, and it’s easy to see why it’s become a bit of a boondoggle. In the case of “The Return,” McKinnon claims that he, not his record label, holds the rights for all usage of his songs. This may have been the source of the confusion.
Both the International Skating Union (ISU) and U.S. Figure Skating claim to be trying to smooth the process, and third-party vendors like ClicknClear offer options, but problems remain. This can lead to last-minute scrambling to secure rights to avoid copyright infringement claims.
While some musicians are flattered by the use of their creations on the Olympic stage, others began demanding compensation for their work. This led to a major flare-up at the Winter Olympics in Beijing four years ago when an indie artist filed a lawsuit after a duo used its cover of “House of the Rising Sun” by the Animals without obtaining permission. Glenn is not the only skater who got a scare over music rights during these Olympics. It took fan pressure and direct appeals before Universal Studios granted Tomàs-Llorenç Guarino Sabaté permission to use music from its Minions franchise.
It’s been an eventful Olympics so far for the gold medal-winning Glenn. Even as she navigated music rights questions, she also found herself at the center of a political firestorm. An outspoken advocate for LGBTQ+ rights, Glenn was the target of extreme vitriol on social media after expressing her concerns for the queer community under President Donald Trump and the current administration. With one medal earned with her Olympic team already around her neck (and hopefully not having the ribbon break, as it did for teammate Alysa Liu), Glenn will seek further glory in the individual competition on February 17. She’ll do so with “The Return” as part of her free skate accompaniment.
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