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Trump to unveil country-based tariffs April 2 in Rose Garden

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President Donald Trump will announce his reciprocal tariff push on Wednesday during an event in the White House Rose Garden, his top spokeswoman said. 

White House Press Secretary Karoline Leavitt said Monday the announcement would feature “country-based” tariffs. She said the president is also “committed to implementing” sectoral duties, but that they were not the focus of the April 2 event and deferred to Trump about the timing of those. Members of Trump’s Cabinet would attend the announcement, Leavitt said.

“The president will be announcing a tariff plan that will roll back the unfair trade practices that have been ripping off our country for decades,” Leavitt told reporters at the White House. “It’s time for reciprocity and it’s time for a president to take historic change to do what’s right for the American people.”

Treasury Secretary Scott Bessent said in a Fox News interview Monday that the tariff announcement would be at 3 p.m. Washington time. 

Leavitt declined to provide details when asked about the rate of the reciprocal tariffs and which countries would be hit. She said there are “no exemptions at this time” when asked whether lower duties would be applied to products used by American farmers. 

Trump told reporters Sunday that he plans to launch reciprocal tariffs with “all countries,” countering speculation he could limit the initial scope of his April 2 announcement. 

But when asked Monday if he was planning a universal tariff or levies on individual countries, Trump demurred, saying “you’re going to see in two days, which is maybe tomorrow night or probably Wednesday.”

“They’re reciprocal. So whatever they charge us, we charge them, but we’re being nicer than they were,” he said. “They took advantage of us, and we are going to be very nice by comparison to what they were. The numbers will be lower than what they’ve been charging us, and in some cases may be substantially lower.”pported.

Earlier Monday, Trump’s spokeswoman pointed to examples of tariff rates from the European Union, Japan, India and Canada while speaking to reporters, signaling those entities are likely among the targets of the president’s new levies. 

“This makes it virtually impossible for American products to be imported into these markets, and it has put a lot of Americans out of business and out of work over the past several decades,” Leavitt said. 

Trump has billed April 2 as the launch of sweeping duties that are the centerpiece of his plan to rebalance global trade, boost U.S. manufacturing and inject tariff revenue into government coffers to fund domestic priorities, including a major tax cut. 

The president has preceded Wednesday’s tariff announcement with levies on Canada, Mexico and China — the US’s three largest trading partners — as well as automobiles, steel and aluminum. Import taxes on copper could come within several weeks. Trump has also threatened tariffs on pharmaceutical, semiconductor and lumber imports. 

Uncertainty surrounding his plans, which have often changed and been subject to last-minute carveouts, have triggered fears they could blow up supply chains and raise prices for U.S. consumers. That angst has fueled a weeks-long sell off on Wall Street that extended into Monday. 

“Wall Street will work out just fine in this administration, just like they did in the first term,” Leavitt said.

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Accounting

Why IRS cuts may spare a unit that facilitates mortgages

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Loan applicants and mortgage companies often rely on an Internal Revenue Service that’s dramatically downsizing to help facilitate the lending process, but they may be in luck.

That’s because the division responsible for the main form used to allow consumers to authorize the release of income-tax information to lenders is tied to essential IRS operations.

The Income Verification Express Service could be insulated from what NMN affiliate Accounting Today has described of a series of fluctuating IRS cuts because it’s part of the submission processing unit within wage and investment, a division central to the tax bureau’s purpose.

“It’s unlikely that IVES will be impacted due to association within submission processing,” said Curtis Knuth, president and CEO of NCS, a consumer reporting agency. “Processing tax returns and collecting revenue is the core function and purpose of the IRS.”

Knuth is a member of the IVES participant working group, which is comprised of representatives from companies that facilitate processing of 4506-C forms used to request tax transcripts for mortgages. Those involved represent a range of company sizes and business models.

The IRS has planned to slash thousands of jobs and make billions of dollars of cuts that are still in process, some of which have been successfully challenged in court.

While the current cuts might not be a concern for processing the main form of tax transcript requests this time around, there have been past issues with it in other situations like 2019’s lengthy government shutdown.

President Trump recently signed a continuing funding resolution to avert a shutdown. But it will run out later this year, so the issue could re-emerge if there’s an impasse in Congress at that time. Republicans largely dominate Congress but their lead is thinner in the Senate.

The mortgage industry will likely have an additional option it didn’t have in 2019 if another extended deadlock on the budget emerges and impedes processing of the central tax transcript form.

“It absolutely affected closings, because you couldn’t get the transcripts. You couldn’t get anybody on the phone,” said Phil Crescenzo Jr., vice president of National One Mortgage Corp.’s Southeast division.

There is an automated, free way for consumers to release their transcripts that may still operate when there are issues with the 4506-C process, which has a $4 surcharge. However, the alternative to the 4506-C form is less straightforward and objective as it’s done outside of the mortgage process, requiring a separate logon and actions.

Some of the most recent IRS cuts have targeted technology jobs and could have an impact on systems, so it’s also worth noting that another option lenders have sometimes elected to use is to allow loans temporarily move forward when transcript access is interrupted and verified later. 

There is a risk to waiting for verification or not getting it directly from the IRS, however, as government-related agencies hold mortgage lenders responsible for the accuracy of borrower income information. That risk could increase if loan performance issues become more prevalent.

Currently, tax transcripts primarily come into play for government-related loans made to contract workers, said Crescenzo.

“That’s the only receipt that you have for a self-employed client’s income to know it’s valid,” he said.

The home affordability crunch and rise of gig work like Uber driving has increased interest in these types of mortgages, he said. 

Contract workers can alternatively seek financing from the private non-qualified mortgage market where bank statements could be used to verify self-employment income, but Crescenzo said that has disadvantages related to government-related loans.

“Non QM requires higher downpayments and interest rates than traditional financing,” he said.

In the next couple years, regional demand for loans based on self-employment income could rise given the federal job cuts planned broadly at public agencies, depending on the extent to which court challenges to them go through.

Those potential borrowers will find it difficult to get new mortgages until they can establish more of a track record with their new sources of income, in most cases two years from a tax filing perspective. 

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Accounting

Republicans eye $25K SALT cap as Trump’s tax cuts take shape

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Republicans are in the process of drafting a tax bill behind closed doors that includes an increase of the state and local tax deduction to as high as $25,000 for an individual, according to people familiar with the plan.

A sizable increase to the current $10,000 limit on SALT write-offs would represent a major political victory for a crucial group of swing-district House Republicans representing the New York City area and southern California, who have made their votes for a broader tax cut bill contingent upon securing a bigger deduction.

The plan, which is still in the process of being drafted and is not final, also includes a renewal of President Donald Trump’s 2017 tax reductions for individuals and closely held businesses as well as some of his campaign tax pledges, the people said, requesting anonymity to discuss private matters. 

Republicans are considering offsetting the increase to the SALT cap by reducing the deductions corporations can claim on the state and local taxes they pay, the people said.

The president has not yet been briefed on this proposal, but the draft represents progress on the top legislative agenda item for Republicans. The party is aiming to pass the legislation by August at the latest, as lawmakers rush to provide a counterweight to the potential economic damage and market downturn from the White House’s tariff policies.

Trump administration aides and Senate Finance Chairman Mike Crapo’s team are taking the lead on writing the plan, the people said. 

Crapo has cautioned that “until the bill is drafted, everything is on the table and nothing’s on the table.”

The White House and the Treasury Department did not immediately respond to requests for comment.

On the campaign trail, Trump promised to eliminate taxes on tipped income, overtime pay and Social Security benefits. The plan will aim to deliver on at least two of those pledges, according to the people familiar.

If Republicans end up including Trump’s Social Security idea, they’ll limit the tax breaks to only apply to incomes below a certain threshold, the people said. Senate rules also limit tax reductions related to payroll levies, so Republicans may need to develop a workaround for seniors that does not directly eliminate income taxes on benefit checks.

Trump’s no-taxes-on-tips idea is the most fleshed-out policy, the people said. 

The Senate is still in the process of negotiating a resolution that will dictate the overall size of the tax cuts and any spending reductions in the final bill. Both chambers of Congress will need to pass identical versions of that measure before official negotiations on the tax cuts can begin.

Crapo’s staff and administration aides are compiling a draft of the tax bill now so that Republicans will largely be on the same page after Congress approves the budget resolution. The Senate plans to vote on the budget, which will also include an increase to the debt ceiling, in the coming days, with the House following next week.

The proposal will also roll back parts of the Inflation Reduction Act, signed by President Joe Biden, as a means to offset some of the cuts.

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Accounting

Washington governor pans wealth-tax proposal amid legal doubt

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Washington Governor Bob Ferguson said he wouldn’t sign a budget that relies on the wealth tax proposed by his fellow Democrats in the state legislature. 

House and Senate budget proposals “both rely on a wealth tax which is novel, untested and difficult to implement,” Ferguson told reporters in Olympia Tuesday. “They need to immediately move budget discussions in a different direction.”

Ferguson said the state is facing a $16 billion budget deficit over the next four years, which will be exacerbated by cuts in federal funding by the Trump administration. Democrats in the Washington State Senate proposed a 1% tax on the stocks, bonds, exchange-traded funds and mutual funds held by people with more than $50 million of those assets. House Democrats are considering a similar measure. 

That would make Washington the first state in the U.S. to tax its residents’ wealth. The bill’s sponsors say that including only publicly traded assets would address some of the concerns that the state’s Department of Revenue raised in a November report regarding the difficulty of calculating and collecting such a tax. Washington doesn’t have an income tax. 

Ferguson did leave open the possibility of a small wealth tax that raises no more than $100 million, just to test the legality of the proposal. 

“We cannot rely on a revenue source with a real possibility of being overturned by the courts,” Ferguson said. 

Some wealthy people have already left Washington since the state passed a 7% tax on capital gains, which was first collected in 2023. Tax attorneys and wealth managers say that even the discussion of a new tax on financial holdings is already encouraging more people to leave the state. 

Speaking in a state Senate hearing on Monday, Rian Watt, executive director of Washington progressive advocacy group Economic Opportunity Institute, said the possibility of capital flight is “worthy of consideration, but in our view it is not worthy of concern.”

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