Accounting
Tax season kickoff: ‘The calm before the change’
Published
4 months agoon


Jo Panuwat D – stock.adobe.com
“The calm before the change” — that is how one industry source aptly described this year’s tax season as Donald Trump returns to the White House, Republicans take control of Congress, and tax professionals navigate an evolving, tech-driven landscape.
While it is unlikely that this tax season will be impacted by any significant changes, the same will likely not hold true as we head into 2026 and beyond. As a result, much of the focus for this season will be on proactive planning, as significant portions of the Tax Cuts and Jobs Act are set to expire at the end of 2025, if they are not extended.
“We don’t expect radical changes for this upcoming tax season or the tax season after that. The current tax laws are in place until the end of 2025. However, the return of the Trump administration to the White House signals that the current tax foundation will likely be renewed into 2026 and beyond, with some possible new provisions. This means that proactive tax planning continues to be essential for those desirous of saving as much as they can in taxes,” said Randy Hughes, CEO of Atlanta-based Counting Pennies and co-founder of Seven Figure Profits.
As noted in a recent Wolters Kluwer tax briefing: “The expectation is that tax legislation will ramp up in early 2025. With the GOP in control of the Senate and the House, Trump’s agenda will have a much easier path to legislative approval. Action on the soon-to-expire TCJA is likely to be high on the to-do list for the new Congress.”
That being said, many tax professionals will also find themselves navigating stricter reporting requirements, evolving tax laws, technological advancements, and staffing constraints.
Keeping pace with regulations, legislation
As the regulatory landscape continues to evolve, it will be important for tax professionals to stay up to speed on potential changes and effectively manage client expectations this tax season.
Said Hughes, “The most significant changes include potential new regulations around cryptocurrency transactions, increased IRS scrutiny on high earners, and adjustments to clean energy credits. Most changes will not be changes to tax law, but the implementation of laws that are already in place. So being familiar with this implementation is important.”
“For our clients, this means being vigilant about reporting accuracy, especially in emerging investment spaces,” Hughes continued. “Top of mind for us is ensuring clients are compliant while maximizing available credits and deductions, particularly for business owners leveraging green energy initiatives.”
The Treasury Department and the Internal Revenue Service, for instance, released in June 2024 final regulations on the Infrastructure Investment and Jobs Act reporting requirements for brokers of digital assets. As explained by the Treasury, this will “require brokers to report gross proceeds on the sale of digital assets beginning in 2026 for all sales in 2025. Brokers will be required to also report information on the tax basis for certain digital assets beginning in 2027 for sales in 2026.”
For transactions occurring in 2025, anyone who is considered a custodial digital asset broker must file the new Form 1099-DA to the IRS.
“The broker reporting of crypto transactions on the 1099-DA is going to start in 2025, so that has sort of postponed the concern a little. We won’t be seeing those forms until probably early 2026, but the other thing that is more of a concern for 2024 is the [Form] 1099-K,” said Mark Luscombe, principal federal tax analyst for Wolters Kluwer Tax and Accounting.
In late November, the IRS announced transition relief for third-party settlement organizations regarding transactions during calendar years 2024 and 2025. Under the IRS guidance, TPSOs will be required to file Form 1099-K to report transactions when the amount of total payments for those transactions is more than $5,000 in calendar year 2024. This threshold will shift to more than $2,500 in calendar year 2025; and more than $600 in calendar year 2026 and after.
Furthermore, TPSOs that have performed backup withholding for a payee during calendar year 2024 must file a Form 1099-K, as well as Form 945, with the IRS. The tax service also stated that, for calendar year 2024, it will not assert penalties for a TPSO’s failure to withhold and pay backup withholding tax during the calendar year. However, it will assert penalties for calendar year 2025 and after.
Luscombe also pointed to the likelihood of bipartisan disaster relief, which could potentially impact the tax season. “There’s a lot of bipartisan support for doing something on disaster relief. Congress has tended to do disaster relief on a piecemeal basis. … Now, with [Hurricanes] Helene and Milton, I think there’s probably going to be an effort at year-end to get through some disaster relief that could impact taxpayers for 2024,” he said.
When looking at new tax regulations or rule changes that could impact firms and their tax clients, Rema Serafi, vice chair of tax at KPMG, referred to what the Big Four firm calls the “Tax Policy Trifecta.”
“In 2025 and beyond, accounting firms — as well as other firms of all sizes — will continue to grapple with the Tax Policy Trifecta: the expiration of $4 trillion in tax cuts from the 2017 Tax Cuts and Jobs Act, the ongoing implementation of the Organisation for Economic Co-operation and Development’s global minimum tax and the future of the regime should the U.S. not comply, and a wave of regulatory changes, including changes introduced by the Inflation Reduction Act, the corporate alternative minimum tax and potential tariffs,” said Serafi. “These issues are top of mind for our firm and clients, as they’ll impact both businesses and individual taxpayers. The expiration of the TCJA provisions, for example, will have wide-reaching implications for many individuals and businesses alike. It’s expected to be a priority for the Trump administration right out of the gate, come next year.”
Working with the IRS
In 2024, service problems with the IRS were cited as a leading issue for most CPA firms, according to an American Insitute of CPAs survey. Will the experience be much the same for firms in 2025?
With funding from the Inflation Reduction Act, the agency has been working to modernize its technology and systems and hire more employees. According to the IRS, the efforts are resulting in improved phone service, faster response times, and higher usage of its virtual assistant tool on key IRS.gov pages, among other improvements.
While progress has been made in improving service, there remains room for improvement.
“The IRS’s efforts to modernize are promising but still uneven,” said Hughes. “While e-filing and automation enhancements have improved processing times, challenges remain with responsiveness and issue resolution. The IRS recently received a multibillion-dollar cash infusion from the government to work on [modernizing] their systems and the increasing of their staff. This means increased security and oversight, including more audits. We anticipate an increase in these activities from the IRS over the next several years.”
Commenting on the IRS’s efforts, Cathy Rowe, senior vice president and segment leader of the U.S. professional market of Wolters Kluwer Tax and Accounting North America, said, “I think the rollouts have been slow, overall, but they are continuing to make progress. I think some of the improvements that we have seen already have been around their communications, so we are expecting that to continue to improve this tax season. Last season they did have a lot of new hires that could not necessarily answer the phones, so the training that they would have had should help for this coming tax season.”
However, looking ahead, Luscombe cautioned that the Trump administration reduced IRS funding, so “the longer term looks not quite as bright under the new administration.”
Automation, AI take center stage
It likely comes as little surprise that greater automation and increased usage of artificial intelligence-powered technology are top of mind for many as firms look for more ways to keep pace with legislative and regulatory changes, improve efficiencies, and ease staffing issues.
Take, for instance, Thomson Reuters’ new generative AI assistant, named CoCounsel, with which tax professionals can ask a question in everyday language and, within moments, the solution will deliver a relevant answer with links to Checkpoint Edge editorial content and source materials.
“As legislation expands, and we know that the talent shortage out there means that there’s more work to be done with less resources, in addition to making the research easier, we see the opportunity for increased automation of different phases of the tax preparation process to be really important. Whether that is the automation of the source document gathering and then eventually the extraction and mapping of that data into tax returns,” said Piritta van Rijn, head of product for accounting, tax and practice at Thomson Reuters. “And then, ultimately, when we go into these periods of change, being able to advise clients on what and how did these legislative changes impact them and what kind of actions to take.”
In light of the issues facing today’s firms, Thomson Reuters has been working to enhance its products and deliver more generative AI-assisted experiences to help firms do more with less, van Rijn noted.
During its Synergy 2024 user conference in November, Thomson Reuters showcased some of the developments such as Review Ready, an AI-assisted tax preparation experience to increase firm efficiency. It combines the power of CoCounsel with workflow automation and software integrations and will be coming in beta this tax season, starting with UltraTax CS. Based on testing to date, van Rijn said users could save at least two hours per 1040 tax return this coming season.

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Van Rijn also pointed to the recent acquisition of Materia, a U.S.-based startup that specializes in the development of an agentic AI assistant for the tax, audit and accounting profession. The agentic AI assistant automates and augments research and workflows to help accountants improve efficiency and effectiveness.
“We are really excited to see how we can evolve that [Materia] offering and use it to accelerate some of these other areas. We’ve already got some of our proprietary Checkpoint content integrated into the Materia platform, and we are excited to see how that can also then help enable more workflow automation, continue to augment the research capabilities, document analysis capabilities, and really drive that product,” van Rijn said.
Meanwhile, Wolters Kluwer is also taking steps to help firms increase automation and improve their ability to harness the power of data. At its recent CCH Connections user conference, the company showcased “some new modules as it relates to firm intelligence,” Rowe said.
“What you are going to see as we move into next year is some schedule optimization modules, and some new reporting modules … . We are also delivering research differently through our CCH Axcess platform, so we’ve had more integration of research within our tax and the browser views,” Rowe explained.
Hughes stated that his firm leverages advanced analytics to help clients optimize their tax positions, and they are also exploring the use of predictive AI for strategic financial modeling.
“In this area, Intuit Tax Advisor, which automatically integrates with Intuit ProConnect, is a game-changer. And since we require Intuit Quickbooks Online of all those we do monthly business bookkeeping and accounting for, the three-tiered process from Quickbooks Online to ProConnect to Tax Advisor makes tax planning so much easier than it had been in the past,” Hughes said.
Hughes also stated that the firm uses automation and AI tools to “streamline processes like data entry, to flag potential compliance risks, and to provide data-driven insights for strategic planning. This is done through AI-powered tax software. In addition, AI-powered tax software can now recommend tax strategies based on the client’s current situation. This allows us to spend more time on client engagement and proactive advisory work, helping clients avoid pitfalls and capitalize on opportunities.”
Serafi at KPMG expects that generative AI will “continue having a significant and positive impact on the profession, where benefits outweigh risks.”
“From automating routine tasks — such as data entry and recordkeeping, to free up human resources to focus on more strategic tax planning activities — to analyzing large sets of financial data to identify patterns and trends, and providing real-time insights and recommendations based on changing tax regulations and market conditions to help companies stay ahead of the curve and make more informed business decisions, we’re infusing the technology in our everyday processes and work and expect it to continue enabling our professionals to better serve our clients. Additionally, the technology is helping tremendously as we help clients navigate the current landscape in tax,” Serafi said.
And while leveraging technology can certainly help firms ease bandwidth constraints during tax season, they would be wise not to overlook additional ways to handle staff shortages or skill gaps, whether that means hiring talent from outside of the tax profession or outsourcing.
For example, Serafi said that a recent “Tax Reimagined” survey conducted by KPMG found that a greater number of corporate tax departments are rethinking their approach and hiring more technology experts who can learn tax, rather than hiring tax experts who can learn technology.
“While a blend of both tech and tax skills will continue to be important, we’re seeing a shift in the desire to increasingly prioritize tech proficiency in certain parts of the tax department,” Serafi said.
And at Counting Pennies, Hughes said the firm focuses on three things:
- Staffing at levels that allow for the firm to get work done even if one or two associates are out;
- Cross training as much as possible; and,
- Having a contractor or two available as a backup in the event of an emergency situation.
Clearly, there’s a lot of change, as well as lots of opportunities, afoot, as tax laws continue to evolve and tax professionals increasingly explore and navigate the powers of AI-enabled innovation.
“While we are still in early days, there is so much value, there is so much that is already available to our customers and to the industry. While it might be a little bit of the calm before the change, we are really optimistic and excited about the future ahead,” van Rijn said.
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Providence, Rhode Island: Four Florida residents have been convicted and sentenced for what authorities called one of the largest schemes to defraud CARES Act programs.
The defendants defrauded various federally funded programs of more than $4.8 million, and each of the defendants pleaded guilty to charges of conspiracy to commit wire fraud and aggravated identity theft. The schemes involved obtaining and using stolen ID information to submit fraudulent applications to multiple state unemployment agencies, including the Rhode Island Department of Labor and Training, and to submit fraudulent Economic Injury Disaster Loans and Paycheck Protection Program loan applications. The defendants also submitted fraudulent applications in the names of other persons to federal and state agencies to obtain tax refunds, stimulus payments, and disaster relief funds and loans.
The scheme involved using the stolen information to open bank accounts to receive, deposit and transfer fraudulently obtained government benefits and payments and to obtain debit cards to withdraw the money.
Sentenced were Florida residents Tony Mertile, of Miramar, identified in court documents as the leader of the conspiracy, to six years in prison; Junior Mertile, of Pembroke Pines, sentenced to 54 months; Allen Bien-Aime, of Lehigh Acres, to four years; and James Legerme, of Sunrise, to four years. All four were also sentenced to three years of supervised release to follow their prison terms.
The government moved to forfeit a total of $4,857,191, or $1,214,294.75 apiece, proceeds of the conspiracy. The defendants have also forfeited hundreds of thousands of dollars’ worth of Rolex watches and assorted jewelry and more than $1.1 million in cash. Each defendant is also liable for $4,456,927.36 in restitution to defrauded agencies and financial intuitions.
Raleigh, North Carolina: Michon Griffin, 46, who engaged as a money mule (a.k.a. middleman) in an international romance scheme, has been sentenced to two years in prison and three years of supervised release after pleading guilty to conspiracy to commit money laundering and to making false statements on her 1040.
Between 2021 to 2023, Griffin received more than $2 million from the scheme that she deposited into fictitious bank accounts that she controlled. She converted the money to virtual currency and wired the funds to overseas accounts controlled by her co-conspirators in Nigeria.
Griffin received some $300,000 from the romance fraud, which she did not report as income on her 1040 for 2021.
She was also ordered to pay $109,119 in restitution to the IRS.
Las Vegas: Tax preparer Keisy Altagracia Sosa has pleaded guilty to preparing false income tax returns.
Sosa has operated the tax prep business National Tax Service, and from 2016 to 2021 prepared and filed false federal returns for clients. These returns included falsely claimed dependents, and fictitious Schedule A and Schedule C expenses such as sales taxes paid and unreimbursed employee expenses.
Sosa continued to prepare false returns even after the IRS notified her that her returns appeared inaccurate and informed her that she may not be meeting due diligence requirements.
Sosa caused at least $550,000 in tax loss to the IRS.
Sentencing is June 11. She faces up to three years in prison, as well as a period of supervised release and monetary penalties.

Elk Mound, Wisconsin: Business owner Deena M. Hintz, of Eau Claire, Wisconsin, has been sentenced to a year in prison for failure to pay employment taxes.
Hintz, who pleaded guilty in December, owned and operated Jade Excavation and Trucking for nearly 10 years and at times had up to 15 employees. From 2017 to 2021, Hintz deducted more than $400,000 in federal employment taxes from employees’ pay and, instead of paying those taxes to the government, kept the money.
She was also ordered to pay $482,185.46 in restitution.
Littleton, Colorado: Tax preparer Thuan Bui, 60, has been sentenced to three years in prison and a year of supervised release and ordered to pay a $50,000 fine after pleading guilty to one count of aiding or assisting in preparation of false documents.
From about 2016 to 2021, Bui operated a tax prep business under several names, lying to clients that he was a CPA. On hundreds of returns, Bui overstated or fabricated expenses on Schedules C.
Philadelphia: Resident Joseph LaForte has been sentenced to 15 and a half years in prison for defrauding investors, conspiring to defraud the IRS, filing false tax returns, employment tax fraud, wire fraud, obstruction and other charges.
LaForte defrauded investors using a fraudulent investment vehicle known as Par Funding. Along with conspirators, he caused a loss to investors of more than $288 million.
He and conspirators diverted some $20 million in taxable income from Par Funding to another entity controlled by LaForte and nominally owned by another, then filed returns that did not report this income; he also received more than $9 million in kickbacks from a customer of Par Funding and did not report this income to the IRS. He paid off-the-books, cash wages to some employees, failing to report these wages to the IRS and not paying employment taxes.
The federal tax loss exceeds $8 million. He also caused $1.6 million in state tax loss to the Pennsylvania Department of Revenue by falsely reporting that he and his wife were residents of Florida from 2013 through 2019 when they lived in Pennsylvania.
Hampton Roads, Virginia: Two area residents have pleaded guilty to their roles in a refund scheme involving pandemic relief credits.
Between October 2022 and May 2023, Kendra Michelle Eley of Norfolk, Virginia, filed eight 941s for Kreative Designs by Kendra LLC using the EIN assigned to another company, Kendra Cleans Maid Service. These forms covered four tax periods in 2020 and four in 2021. On each of the forms, Eley falsely reported wages paid and federal tax withholdings for 18 purported employees, knowing there were no such employees.
For the four forms filed for 2021, Eley claimed false sick and family leave credits and Employee Retention Credits, totaling some $975,000. In December 2022, the IRS issued two refund checks payable to the cleaning company totaling $649,050.
That same month, Eley and Rejohn Isaiah Whitehead, of Portsmouth, Virginia, opened a business checking account in the name of Kendra Cleans; signatories on the account were Eley and Whitehead. The two falsely represented the nature and extent of the business, including that it had 16 employees and that the average pay of each was $2,000. Eley funded the account by depositing one of the refund checks in the amount of $389,640. In January 2023, Eley wrote Whitehead two checks from the account totaling $60,000.
Whitehead’s sentencing is June 26 and Eley’s is July 9. They each face up to 10 years in prison.
Accounting
Accountants tackle tariff increases after ‘Liberation Day’
Published
13 hours agoon
April 3, 2025
President Trump’s imposition of steep tariffs on countries around the world is likely to drive demand for accounting experts and consultants to help companies adjust and forecast the ever-changing percentages and terms.
On April 2, which Trump dubbed “Liberation Day,” he announced a raft of reciprocal tariffs of varying percentages on trading partners across the globe and signed an
“A lot of CFOs are thinking they are going to pass along the tariffs to their customer base, and about another half are thinking we’re going to absorb it and be more creative in other ways we can save money inside our company,” said Tom Hood, executive vice president for business engagement and growth at the AICPA & CIMA.
The AICPA & CIMA’s most recent
“CFOs in our community are telling us that, effectively, they’re looking at this a lot like what happened over COVID with a big disruption out of nowhere,” said Hood. “This one, they could see it coming. But the point is they had to immediately pivot into forecasting and projection with basically forward-looking financial analysis to help their companies, CEOs, etc., plan for what could be coming next. This is true for firms who are advising clients. They might be hired to do the planning in an outsourced way, if the company doesn’t have the finance talent inside to do that.”
The tariffs are not set in stone, and other countries are likely to continue to negotiate them with the U.S., as Canada and Mexico have been doing in recent months.
“The one thing that I think we can all count on is a certain amount of uncertainty in this process, at least for the next several months,” said Charles Clevenger, a principal at UHY Consulting who specializes in supply chain and procurement strategy. “It’s hard to tell if it’s going to go beyond that or not, but it certainly feels that way.”
Accountants will need to make sure their companies and clients stay compliant with whatever conditions are imposed by the U.S. and its trading partners. “This is a more complex tariff environment than most companies have experienced in the past, or that seems to be where we’re headed, and so ensuring compliance is really important,” said Clevenger.
Big Four firms are advising caution among their clients.
“Our point of view is we’re advising all of our clients to do a few things right out of the gate,” said Martin Fiore, EY Americas deputy vice chair of tax, during a webinar Thursday. “Model and analyze the trade flows. Look at your supply chain structures. Understand those and execute scenario planning on supply chain structures that could evolve in new environments. That is really important: the ability for companies to address the questions they’re getting from their C-suite, from their stakeholders, is critical. Every company is in a different spot according to the discussions we’ve had. We just are really emphasizing, with all the uncertainty, know your structure, know your position, have modeling put in place, so as we go through the next rounds of discussions over many months, you have an understanding of your structure.”
Scenario planning will be especially important amid all the unpredictability for companies large and small. “They’re going to be looking at all the different countries they might have supply chains in,” said Hood. “And then even the smaller midsized companies that might not be big, giant global companies, they might be supplying things to a big global company, and if they’re in part of that supply chain, they’ll be impacted through this whole cycle as well.”
Accountants will have to factor the extra tariffs and import taxes into their costs and help their clients decide whether to pass on the costs to customers, while also keeping an eye out for pricing among their competitors and suppliers.
“It’s just like accounting for any goods that you’re purchasing,” said Hood. “They often have tariffs and taxes built into them at different levels. I think the difference is these could be bigger and they could be more uncertain, because we’re not even sure they’re going to stick until you see the response by the other countries and the way this is absorbed through the market. I think we’re going through this period of deeper uncertainty. Even though they’re announced, we know that the administration has a tendency to negotiate, so I’m sure we’re going to see this thing evolve, probably in the next 30 days or whatever. The other thing our CFOs are reminding us of is that the stock market is not the economy.”
Amid the market fluctuations, companies and their accountants will need to watch closely as the rules and tariff rates fluctuate and ensure they are complying with the trading rules. “Do we have country of origin specified properly?” said Clevenger. “Are we completing the right paperwork? When there are questions, are we being responsive? Are we close to our broker? Are we monitoring our customs entries and all the basic things that we need to do? That’s more important now than it has been in the past because of this increase in complexity.”
Accounting
How to use opportunity zone tax credits in the ‘Heartland’
Published
14 hours agoon
April 3, 2025
A tax credit for investments in low-income areas could spur long-term job creation in overlooked parts of the country — with the right changes to its rules, according to a new book.
The capital gains deferral and exclusions available through the “opportunity zones” credit represent one of the few areas of the Tax Cuts and Jobs Act of 2017 that drew support from both Republicans and Democrats. The impact of the credit, though, has proven murky in terms of boosting jobs and economic growth in the roughly 7,800 Census tracts qualifying based on their rates of poverty or median family incomes.
Altering the criteria to focus the investments on “less traditional real estate and more innovation infrastructure” and ensuring they reach more places outside of New York and California could “refine the where and the what” of the credit, said Nicholas Lalla, the author of “
“I don’t want to sound naive. I know that investors leveraging opportunity zones want to make money and reduce their tax liability, but I would encourage them to do a few additional things,” Lalla said. “There are communities that need investment, that need regional and national partners to support them, and their participation can pay dividends.”
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A call to action
In the book, Lalla writes about how the Innovation Labs received $200 million in fundraising through public and private investments for projects like a startup unmanned aerial vehicle testing site in the Osage Nation called the Skyway36 Droneport and Technology Innovation Center. Such collaborations carry special relevance in an area like Tulsa, Oklahoma, which has a history marked by the wealth ramifications of the
“This book is a call to action for the United States to address one of society’s defining challenges: expanding opportunity by harnessing the tech industry and ensuring gains spread across demographics and geographies,” he writes. “The middle matters, the center must hold, and Heartland cities need to reinvent themselves to thrive in the innovation age. That enormous project starts at the local level, through place-based economic development, which can make an impact far faster than changing the patterns of financial markets or corporate behavior. And inclusive growth in tech must start with the reinvention of Heartland cities. That requires cities — civic ecosystems, not merely municipal governments — to undertake two changes in parallel. The first is transitioning their legacy economies to tech-based ones, and the second is shifting from a growth mindset to an inclusive-growth mindset. To accomplish both admittedly ambitious endeavors, cities must challenge local economic development orthodoxy and readjust their entire civic ecosystems for this generational project.”
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Researching the shortcomings
And that’s where an “opportunity zones 2.0” program could play an important role in supporting local tech startups, turning midsized cities into innovation engines and collaborating with philanthropic organizations or the federal, state and local governments, according to Lalla.
In
Other research suggested that opportunity-zone investments in metropolitan areas generated a 3% to 4.5% jump in employment, compared to a flat rate in rural places,
“It creates a strong incentive for taxpayers to make investments that will appreciate greatly in market value,” Tax Foundation President Emeritus Scott Hodge wrote in the analysis, “Opportunity Zones ‘Make a Good Return Greater,’ but Not for Poor Residents” shortly after the Treasury study.
“This may be the fatal flaw in opportunity zones,” he wrote. “It explains why most of the investments have been in real estate — which tends to appreciate faster than other investments — and in Census tracts that were already improving before being designated as opportunity zones.”
So far, three other research studies have concluded that the investments made little to no impact on commercial development, no clear marks on housing prices, employment and business formation and a notable boost in multifamily and other residential property,
The credit “deviates a lot from previous policies” that were much more prescriptive, Feldman said.
“It didn’t want the government to have a lot of oversay over what was going on, where the investment was going, the type of investments and things like that,” she said. “It offered uncapped tax incentives for private individual investors to invest unrealized capital gains. So this was the big innovation of OZs. It was taking the stock of unrealized capital gains that wealthy individuals, or even less wealthy individuals, had sitting, and they could roll it over into these funds that could then be invested in these opportunity zones. And there were a lot of tax breaks that came with that.”
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A ‘place-based’ strategy
The shifts that Lalla is calling for in the policy “could either be narrowing criteria for what qualifies as an opportunity zone or creating force multipliers that further incentivize investments in more places,” he said. In other words, investors may consider ideas for, say, semiconductor plants, workforce training facilities or data centers across the Midwest and in rural areas throughout the country rather than trying to build more luxury residential properties in New York and Los Angeles.
While President Donald Trump has certainly favored that type of economic development over his career in real estate, entertainment and politics, those properties could tap into other tax incentives. And a refreshed approach to opportunity zones could speak to the “real innovation and talent potential in midsized cities throughout the Heartland,” enabling a policy that experts like Lalla describe as “place-based,” he said. With any policies that mention the words “
“We can’t have cities across the country isolated from tech and innovation,” he said. “When you take a geographic lens to economic inclusion, to economic mobility, to economic prosperity, you are including communities like Tulsa, Oklahoma. You’re including communities throughout Appalachia, throughout the Midwest that have been isolated over the past 20 years.”
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Hope for the future?
In the book, Lalla compares the similar goals of opportunity zones to those of earlier policies under President Joe Biden’s administration like the Inflation Reduction Act, the CHIPS and Science Act, the American Rescue Plan and the Infrastructure Investment and Jobs Act.
“Together, these bills provided hundreds of millions of dollars in grant money for a more diverse group of cities and regions to invest in innovation infrastructure and ecosystems,” Lalla writes. “Although it will take years for these investments to bear fruit, they mark an encouraging change in federal economic development policy. I am cautiously optimistic that the incoming Trump administration will continue this trend, which has disproportionately helped the Heartland. For example, Trump’s opportunity zone program in his first term, which offered tax incentives to invest in distressed parts of the country, should be adapted and scaled to support innovation ecosystems in the Heartland. For the first time in generations, the government is taking a place-based approach to economic development, intentionally seeking to fund projects in communities historically disconnected from the nation’s innovation system and in essential industries. They’re doing so through a decidedly regional approach.”
Advisors and
“This really is a bipartisan issue. Opportunity zones won wide bipartisan approval,” he said. “Heartland cities can flourish and can do so in a complicated political environment.”

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