Dallas Morning News decries “loophole”

The new Texas Margin Tax does not apply to general partnerships made up of natural persons. According to the Dallas Morning News, some law firms are looking at this "loophole." Of course the same loophole is available to CPAs and any other professional organization.

John Sharp, author of the Margin Tax even suggested to law firms that if they didn’t want to pay the tax, they should become general partnerships. Sharp characterized the Margin Tax as liability insurance: you don’t have to pay it if you don’t take advantage of statutory liability limits available to corporations, limited partnerships, limited liability companies, limited liability partnerships, and professional associations.

But the misguided Dallas Morning News seems to expect taxpayers to pay their share, even if the law allows otherwise. They say "For now, here’s our message: Let’s quit trying to slip through the loopholes and, instead, avoid dismantling reforms that took years to achieve. " Talk about unrealistic expectations! Read the editorial here.

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