Tax news August 2007 | AccountingWEB

Tax news August 2007


"Carried Interest" in private equity: Capital gain or performance fee?

The debate now taking place in Congress on the tax paid on "carried interest," by private equity and hedge fund managers was not triggered by the initial public offering of The Blackstone Group, the private equity firm headed by Steve Schwarztman, but details of Schwarztman's total earnings that were revealed in the filing brought increased media attention to the issues being debated.Much of the discussion in Congress and the media centers on whether the "carried interest," which is a major component of the managers' total compensation, should be taxed, as it now is, as a capital gain at 15

Increase in tobacco taxes – two sides to this story

The House of Representatives has passed legislation supporting the State Children's Health Insurance Program (SCHIP) and in so doing has voted to increase the federal cigarette tax by 45 cents per pack. Ironically, cigarette taxes target those SCHIP is supposed to help: the working poor, who are statistically more likely to smoke, according to the Citizens Against Government Waste. Excessively high excise taxes lead many consumers to circumvent the tax by purchasing products out-of-state, online, or through illegal sales. It also reduces the number of smokers.

Summertime tax workout tips

From buying or selling a home to sending the kids to camp, to buying a fuel-efficient car or even cleaning the garage, summertime activities and expenses can mean tax credits or deductions on a 2007 tax return, provided taxpayers keep records. Summer is also a good time to check withholding, and calculate any tax that is owed on non-salary items like a gain from the sale of stock or other property. Taxpayers should try to find time between naps or more strenuous vacation activities to check the following so they don’t miss tax-saving opportunities.

IRS issues final regs on reportable shelter transactions

The IRS has issued final regulations on the disclosure of reportable shelter transactions. These regulations affect shelter participants and material advisors. The new regulations are T.D. 9350, T.D. 9351, and T.D. 9352.T.D. 9350 adds a new transactions of interest reporting category for the purpose of assessing potential tax avoidance or evasion.


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