Wednesday, May 15, 2013

Hold on just a minute...

Maybe you've seen the rosy stories this week that tax revenues are rising and the deficit is shrinking.

Well hold on.

Remember the fiscal cliff?

There was a bunch of stock and even some real estate selling near the close of 2012 as people sought to avoid risk of drastically higher tax rates that could have been triggered if no fiscal cliff deal was reached.

Many companies went so far as to pay dividends early, dispersing first quarter 2013 payouts in December 2012 rather than waiting until March.

Anyone not expecting a big bump in tax revenue as a result of this is grossly unaware.

Remains to be seen how much of this rising revenue is a trend. And how much was a one-shot wonder.

Deliberately incurring taxation in 2012 may actually mean 2013 collections could take a hit this time next year.

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