Business Frame Weekly – Failing to pay enough tax or missing the deadline can result in IRS penalties/ The much-discussed recession of 2023 still isn't here

Business Frame Weekly – Failing to pay enough tax or missing the deadline can result in IRS penalties/ The much-discussed recession of 2023 still isn't here

Failing to pay enough tax through withholding or estimated payments, or missing the deadline, can result in IRS penalties.

The much-discussed recession of 2023 still isn't here, and economists are becoming less confident it will come at all.

To at least one market veteran, the stock market’s resurgence after a string of bank failures and rapid interest rate hikes means only one thing: Watch out.

In this newsletter:


June 13, 2023

Estimated Tax Payments Are Due June 15, IRS Says

Failing to pay enough tax through withholding or estimated payments, or missing the deadline, can result in IRS penalties. The upcoming deadline for 2023 estimated tax payments is June 15, which is approaching quickly. If you don’t have taxes automatically deducted from a regular paycheck due to being self-employed or retired, for example, you may need to make estimated tax payments. The reason why is that in the United States, we have a pay-as-you-go system for taxes.

Wall Street economists are increasingly less worried about a 2023 recession

The much-discussed recession of 2023 still isn't here, and economists are becoming less confident it will come at all. This week, Wells Fargo's team of economists became the latest group to dial back its recession outlook. The firm now sees a recession hitting at the beginning of 2024 as recent economic data reveals an economy "not yet on the brink of recession." "While we still expect the delayed effects of monetary tightening and tighter credit availability to dampen economic growth, the economy has proven to be more resilient than we anticipated," Wells Fargo's team of economists wrote in a note to clients on Wednesday. "As a result, we have pushed back our expectations for the start of economic contraction to Q1-2024."

JPMorgan bond chief Bob Michele sees worrying echoes of 2008 in market calm

To at least one market veteran, the stock market’s resurgence after a string of bank failures and rapid interest rate hikes means only one thing: Watch out. The current period reminds Bob Michele, chief investment officer for JPMorgan Chase’s massive asset management arm, of a deceptive lull during the 2008 financial crisis, he said in an interview at the bank’s New York headquarters. “This does remind me an awful lot of that March-to-June period in 2008,” said Michele, rattling off the parallels. Then, as now, investors were concerned about the stability of U.S. banks. In both cases, Michele’s employer calmed frayed nerves by swooping in to acquire a troubled competitor. Last month, JPMorgan bought failed regional player First Republic; in March 2008, JPMorgan took over the investment bank Bear Stearns.

IRS is Going After NIL Collectives’ Tax-Exempt Donations

An IRS memo says the name, image and likeness benefits provided to college athletes serve their private interests, not the public's interests. The national landscape surrounding name, image, and likeness laws continues to evolve—with the latest development potentially impacting the operations of NIL collectives associated with The Ohio State University. Last Friday, the IRS’s Chief Counsel’s office released a memo stating that donations made to nonprofit NIL collectives are not tax exempt. The memo argues, in many cases, the benefits provided to college athletes serve those players’ private interests, not the interests of the public. The memo’s conclusion reads: “An organization that develops paid NIL opportunities for student-athletes will, in many cases, be operating for a substantial nonexempt purpose—serving the private interests of student-athletes—which is more than incidental to any exempt purpose furthered by the activity.”

IRS revises actuarial tables to account for most recent mortality data

The IRS issued final regulations relating to the use of actuarial tables for valuing annuities, interests for life or a term of years, or remainder or reversionary interests. The regulations (T.D. 9974) were necessary because Sec. 7520(c)(3) directs the IRS to update the actuarial tables to take into account the most recent mortality data available, no less often than once every 10 years. The regulations will affect persons valuing inter vivos and testamentary transfers of interests in property dependent on one or more measuring lives. Sec. 7520(a) provides that the value of any annuity, any interest for life or a term of years, or any remainder or reversionary interest is determined under tables prescribed by the IRS and by using an interest rate based on the federal midterm rate in effect under Sec. 1274(d)(1) for the month in which the valuation date falls.

Tech leads market rally to start crucial week for US economy: Stock market news today

Stocks rallied on Monday to kick off a busy week for the US economy with inflation data out early Tuesday and the Federal Reserve's next policy decision set for release Wednesday afternoon. At the closing bell on Monday all three major indexes were higher, with the Nasdaq Composite (^IXIC) pacing gains, rising 1.53%. The S&P 500 (^GSPC) gained 0.94% while the the Dow Jones Industrial Average (^DJI) was higher by 190 points, or 0.56%. Monday's gains came after the S&P 500 entered a bull market last week and closed at its highest level since August 2022 while the Nasdaq continued a streak of seven-straight winning weeks.

Random Ramblings

  • At a time when most Americans are living paycheck to paycheck, the ‘quiet luxury’ trend takes over.
  • Big banks are talking up generative A.I. — but the risks mean they’re not diving in headfirst
  • What investors want to know about the SEC's crypto crackdown
  • National taxpayer advocate: A paperless IRS is possible.
  • Gen Z and millennials are feeling 'anxious' in today's economy, surveys find.
  • Which States Don’t Tax Social Security Benefits?

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