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TaxBuzz Top 5 - Former U.S. Rep. Accused of Tax Evasion in Office, Detroit's Growth Set to Stall as Tax Incentives Sunset & More

TaxBuzz Top 5 - Former U.S. Rep. Accused of Tax Evasion in Office, Detroit's Growth Set to Stall as Tax Incentives Sunset & More

Each Friday, TaxBuzz brings you the top five tax and accounting headlines you need to know from the workweek. We know life can get busy and you don't always have time to scroll through your news feed to stay informed.

We weed through all of the week's stories to showcase the most important updates in the tax and accounting world.

1. Former South Carolina Rep. R.J. May Accused of Tax Evasion While in Office

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Former South Carolina lawmaker R.J. May has been accused of failing to file and pay state income taxes during his time in office, according to arrest warrants issued by the South Carolina Department of Revenue. The Republican from West Columbia faces three counts related to unfiled tax returns spanning multiple years, with investigators alleging he owes more than $14,600 in unpaid state income taxes.

May, who served in the South Carolina House of Representatives, was arrested this week and booked into the Edgefield County Detention Center. Officials say the violations occurred while he was an elected representative, raising questions about ethics and accountability in state politics.

If convicted, May could face both financial penalties and potential jail time under South Carolina’s tax laws. The Department of Revenue has stated it will continue pursuing criminal charges in cases where public officials are found to have willfully failed to meet their tax obligations.

May has not yet issued a public statement regarding the charges. The case adds to a growing list of South Carolina political figures facing legal scrutiny, further shaking public confidence in state leadership.

2. Treasury Plan Could Strip Tax Credits From Millions Of Immigrants

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Credit: Richard Sharrocks/Getty Images

A sweeping new proposal from the U.S. Department of the Treasury could block millions of immigrant taxpayers from claiming key federal tax credits — including the Earned Income Tax Credit, Child Tax Credit, and American Opportunity Credit — beginning in 2026.

Per the AP, under the proposed rule, these credits would be reclassified as “federal public benefits,” a move that would effectively bar non-citizens — including DACA recipients, Temporary Protected Status holders, and families with mixed immigration status — from eligibility. Critics argue the change bypasses Congress and unfairly targets people who legally live and work in the United States, many of whom already pay federal and state taxes.

Treasury officials say the update simply enforces existing federal law designed to limit taxpayer-funded benefits to U.S. citizens. Immigrant-rights groups, however, call it an “economic exclusion order” that could deepen poverty for millions of working families.

According to the Institute on Taxation and Economic Policy, undocumented immigrants contributed nearly $100 billion in combined taxes in 2022 — funds that help support the very programs they may soon lose access to. The rule is currently under review and could take effect for the 2026 tax year if finalized.

3. Developers Warn Detroit’s Growth Could Stall if Tax Laws Sunset

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A vital set of tax incentive laws in Detroit—designed to spur development in the city—are now at risk of expiring, raising alarm bells among developers and economic-development stakeholders. According to the Detroit Regional Chamber and the Economic Development Leaders of Michigan, these incentives have been integral to redevelopment efforts and losing them could hinder the momentum that’s driven downtown investment. 

The laws in question include what are commonly known as “transformational” or “brownfield” incentive programs—tools that provide tax capture, abatements and other benefits to large-scale projects in the city. Proponents argue those incentives helped Detroit remain competitive in attracting investment. But the state’s fiscal posture and shift in legislative priorities mean the future of these incentives is now uncertain. 

For developers, the implications are serious: if the incentives expire or are scaled back, project underwriting will change, anticipated returns may decline, and some deals may no longer pencil out. For Detroit, the risk is stalling or slowing growth in key corridors just as the city works to ride its revitalization wave. Per the Detroit Free-Press, business-groups are urging lawmakers to act swiftly to extend or renew the incentive framework. 

4. Obamacare Premium Tax Credits Could Expire As Trump Opposes Extension

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A key set of Affordable Care Act premium tax credits — expanded during the pandemic to make health insurance more affordable — are set to expire at the end of this year, potentially driving up costs for millions of Americans.

Roughly 22 million people currently benefit from the enhanced subsidies, which were first introduced under the American Rescue Plan and later extended by the Inflation Reduction Act. Without congressional action, premiums could skyrocket by hundreds of dollars per month, pushing many lower- and middle-income families out of the marketplace entirely.

Former President Donald Trump and Republican lawmakers have come out against extending the credits, arguing that the subsidies are fiscally unsustainable and should be replaced with broader health savings account reforms. Democrats, meanwhile, warn that allowing the credits to lapse would amount to a “massive middle-class tax hike” and unravel one of the ACA’s most popular provisions.

The looming expiration puts renewed pressure on Congress as both parties gear up for the 2026 election season, and underscores how the future of health care affordability could once again hinge on partisan gridlock in Washington.

5. Teacher Struck Off After OnlyFans Page Fined £25,000 For Unpaid Tax Bill

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Credit: Klaus Vedfelt/Getty Images

A former Scottish teacher has been removed from the teaching register after pupils discovered her OnlyFans account, and now faces a £25,000 tax penalty for unpaid income linked to the page, the BBC reports.

According to the General Teaching Council for Scotland (GTCS), the educator — who taught secondary students — failed to sufficiently hide her identity while posting explicit content online. The disciplinary panel found her behavior “incompatible with the standards expected of the profession,” noting she also referenced her teaching career in promotional materials.

In addition to losing her teaching status, she was named by HMRC on its public list of tax defaulters after allegedly failing to pay nearly £39,000 in taxes from 2022 to 2023. The penalty of £25,189 brings renewed attention to how side hustles and adult content earnings are regulated under U.K. tax law.

The case has reignited debate over teachers’ private lives versus professional conduct, as more educators turn to subscription-based platforms for supplemental income. Regulators insist that educators must maintain public confidence even beyond the classroom.

Which headline this week most interests you?

Feature Image Photographer: Photo by Mike Kline (notkalvin)

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