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Tax cases to be heard by the Supreme Court

October 2, 2007

The Supreme Court has five tax cases on its docket for the new term, which began Monday.

A couple of them strike me as having the potential to affect "average" taxpayers.

First, there’s Kentucky Department of Revenue v. Davis, which deals with the issue of a state providing an income tax exemption for bonds it issues, while continuing to tax interest income realized from bonds issued by other states.

This is a standard practice in most of the jurisdictions that have a state income tax. State tax collectors pocket a portion of interest paid on out-of-state municipal bonds, but allow their residents to avoid taxes on interest earned by bonds issued within their own state.

And then there’s Knight v. Commissioner, which involves the constitutional question of deductions by trusts and estates. Specifically, question is whether federal tax law permits a full deduction, vs. a 2 percent limit, for costs and fees for investment management and advisory services provided to trusts and estates.

You can find a comprehensive look at these and the other three cases at TaxProf.

the-nine_book-coverCourt scoop: If you’re interested in the Supreme Court itself, Jeffery Toobin has a new book out on America’s ultimate legal panel.

The New York Times calls it a "smart and entertaining book." You can read the full review here.

Other reviews, as well as a video interview of Toobin, can be found at Amazon.

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TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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