Child Credit Cancelled, Protesting Partnership Filing Fees, Unemployment Benefit Implications

Over 30 million households began receiving advanced payments for their children in July following Congress’ temporary transformation of the annual tax break. Democrats hailed the expansion of the credit as groundbreaking and boasted how it sharply cut child poverty saying it would prove so popular the credit would be made permanent – now the expanded credit is dead. Those who took advantage of advanced payments should be bracing for them to end this month, and looking for other ways to bolster their budgets.

The credit ending comes as a direct result of Democrats’ $2 trillion education, healthcare, and climate bill never passed the Senate due to Joe Manchin’s (D., W.Va.) objections. There is still no clear fix, and we do not know what policies are going to be redacted to have the bill come to fruition. Included in those to be removed could very well be the permanent dismissal of advanced child tax credit payments.

The Supreme Court will decide this month if they are willing to heart a New Jersey State tax case which would have implications for partnerships across the country. The case revolves around a partnership “filing fee” that is not restricted to a partnership’s in-state activities, meaning the tax will need to be paid no matter how involved the business is with the State. The current fee is $150 per partner and settles at $250,000 per partnership whether 1% or 100% of business was conducted in the state.

This $250,000 maximum on the tax is typically only reached by publicly traded partnerships with tens of thousands of partners, these companies are now looking to combat the tax. The case, Ferrellgas Partners, L.P. v. N.J. Division of Taxation is using the Commerce Clause requirement as its argument. This clause states that if a state imposes a fee or tax on interstate commerce, it must be fairly apportioned among the states where the commerce takes place. This being said, the tax could be argued against due to its flat fee per partner nature.