California Governor Gavin Newsom has been playing “David versus Goliath” with President Donald Trump, especially as Trump has ordered troops into Los Angeles to quell protests against his immigration raids. Now Newsom has floated a wild idea: what if California stopped sending money to the IRS?
Yes, you read that right. The head of the fifth-largest economy in the world — home of tech bros, movie stars, and $12 oat milk lattes — is making noises about withholding federal tax revenue.
Hailey Bieber – daughter of actor Stephen Baldwin and wife of singer Justin Bieber – just proved she’s more than another nepo baby with a serum line. Today she’s a full-blown tax case study with a side of moisturizer! In a deal that left beauty insiders and financial planners equally slack-jawed, she sold her skincare brand, Rhode, to e.l.f. Beauty for $1.1 billion. The press called it iconic. Wall Street called it synergistic. And the IRS? They called dibs.
Pope Leo XIV will assume all sorts of duties as he moves into his new role as His Holiness. He’ll lead weekly masses and celebrations. He’ll preside over religious observances like Christmas and Easter. He’ll travel the world to promote peace, dialogue, and humanitarian causes. He’ll meet with bishops, cardinals, and Vatican officials in his role as sovereign of the Vatican City. And, for the first time ever, he’ll file a Form 1040 with the IRS. Or will he?
It’s no secret Uncle Sam has been living above his means. He hasn’t balanced his budget since 2001. He put trillions on his American Express card to pay for Covid relief. And now, as he struggles to extend the Tax Cuts and Jobs Act of 2017 later this year, he’s fighting to flesh out a budget resolution that authorizes $86 trillion in spending through 2034. If he was your real uncle, you might be googling “Debtors Anonymous” meetings in your neighborhood.
Last week, we discussed how the 2017 tax cuts are scheduled to expire at the end of 2025—and how the election results make it likelier that Washington will extend them. Here’s the problem: it won’t be cheap. The Congressional Budget Office estimates extending the current rules will blow a $4 billion hole in the budget over the next 10 years, along with an unknown amount of higher interest payments on the new debt. That’s making life difficult for a new administration that also wants to eliminate tax on tips, overtime pay, and Social Security benefits, along with other giveaways.
