Tax news January 2008

Tax

New tax scams offering tax rebate and using IRS name flood e-mail inboxes and telephones

The Internal Revenue Service is warning taxpayers to beware of several current e-mail and telephone scams that use the IRS name as a lure. The IRS expects such scams to continue through the end of tax return filing season and beyond.The IRS cautioned taxpayers to be on the lookout for scams involving proposed advance payment checks.
Tax

Tax relief aimed at easing sub-prime mortgage mess

Amid daily headlines of a worsening housing crisis, debt-burdened homeowners are looking to two pieces of congressional action that could ease the pain.Monday's headlines stated that new home sales fell by 26 percent last year, which is the biggest drop since 1963, the U.S. Department of Commerce says. And last week's headlines said sales of previously owned single-family homes took a dive - the biggest annual drop in 25 years.
Tax

State tax comparison seen as key factor in choosing a retirement destination

With tax season rapidly approaching, many people planning their retirement are wondering how their retirement income will be taxed if they move. Also, what other taxes will they have to confront in their new location.Depending on where you choose to live, your tax bill may affect your ability to enjoy the lifestyle you are seeking. Some states are more tax-friendly to retirees than others.Helping to sort all this out is a Web site run by the Retirement Living Information Center.
Tax

Tax breaks attract movie makers - and Johnny Depp? - to Wisconsin

Generous tax breaks that took effect at the start of this year are already attracting attention from movie and television companies looking to film in Wisconsin, officials say.The state enacted incentives of up to 25 percent of production costs incurred while shooting in Wisconsin, prompting the Hollywood Reporter to ask, "Is a filmmaking 'third coast' one step closer to happening?' "The incentives apparently put Wisconsin on competitive footing with California and New York, and Milwaukee-based Marcus Theatres has also agreed to "provide the foundation bookings" for movies filmed
Tax

Roles of CPAs and forensic accountants in corporate investigations

Since Sarbanes-Oxley was enacted, the Securities Exchange Commission (SEC) and the Department of Justice (DOJ) have increased the number of their accounting investigations and related enforcement actions. During this time, public companies have also been initiating their own investigations due to internal audit findings, whistleblower allegations or proactively after news reports of accounting improprieties at other entities.
Tax

IRS reports increase in audits and taxpayer services for fiscal 2007

The IRS reports that it continues to make strong progress in a number of key enforcement areas. Recently published statistics show the number of audits increased in all areas in fiscal 2007, the number of e-filers has increased, and the usage of the IRS Web site is increasing as well.During 2007 the IRS audited 84 percent more returns of individuals with incomes of $1 million or more than during 2006.
Tax

IRS names 41 new members to Taxpayer Advocacy Panel

The Treasury Department and the Internal Revenue Service are pleased to announce the selection of 41 new members to serve on the nationwide Taxpayer Advocacy Panel (TAP), a Federal Advisory Committee charged with providing direct taxpayer input to the IRS. The new panel members will join 57 returning members to round out the panel of 98 volunteers for 2008. The new members were selected from over 400 interested individuals from all over the country, who applied through an open recruitment period last spring.
A&A

Disaster recovery, backup, and restore: Big challenges for small businesses

All too frequently, fires, local flooding, and human error threaten computer systems, communications, and the ability of a business of any size to sustain continuous operations. Small and medium sized businesses, accustomed to protecting inventory or paper records, are expected to invest more in "resilience and backup" in 2008 according to cio-midmarket.com. "Most are on the edge where a couple of bad events could shut down business," says Gary Chen an analyst at YankeeGroup.
Tax

"The dog ate my tax return" won't fly with the IRS

The Internal Revenue Service has issued a notice that lists four additional erroneous legal positions that taxpayers should refrain from using as an excuse to avoid paying their taxes.An individual or group may not avoid paying their fair share of taxes by making frivolous legal arguments such as those listed below.
Tax

Defining independent contractors

With growing acceptance of flexible work arrangements among large and small employers, many, including seasonal employers, are increasing their contingent hiring to meet the peaks and valleys of demand. A 2007 Staffing Buyers Survey estimates that the contingent workforce will grow to 10 percent of all U.S. workers in two years, CCH reports. Classifying contingent workers as independent contractors benefits employers because it reduces recruiting and training costs, CCH says.
Tax

IRS outsourcing of debt collectors a failure

In her annual report to Congress, National Taxpayer Advocate Nina Olson said that the Internal Revenue Service's private tax debt collection program (PDC) is falling way short of projected goals. And, according to Olson, the IRS knows it.In May, the IRS estimated that the program using private collection agencies (PCAs) to pursue delinquent tax debts would raise gross revenue of between $1.5 billion and $2.2 billion over the next 10 years. It was estimated that yearly collections would reach a midpoint average of about $185 million.
Tax

IRS names 20 new Advisory Committee members

The Internal Revenue Service has announced the selection of 20 new members of the Information Reporting Program Advisory Committee (IRPAC), which provides an organized public forum for discussion of relevant tax administration issues between IRS officials and representatives of the public. "The new members of IRPAC will contribute to this important group their years of experience and depth of understanding about tax administration," said Linda Stiff, Acting IRS Commissioner.
Tax

My life in crime: Chronicles of a forensic accountant

By William C. Barrett III, CPA/ABV, CVA, CTP, CCFMThe profession of forensic accounting is like any other industry niche: You evolve to a plateau where track record and honed skills permit you to hold yourself out as a professional. Then, like any other business, you starve a lot before you become an overnight sensation - in demand and truly at the top of your practice in providing value - both on scene and in the courtroom.
Technology

It's open season for electronic tax filing

Most taxpayers may file their 2007 tax returns electronically beginning January 11 as the Internal Revenue Service opens the e-file program.Benefits of E-FileThe IRS states that taxpayers who use IRS e-file and who choose direct deposit can receive their refund in as little as ten days. With e-file there is no paper return going to the IRS, and with direct deposit, there is no paper refund going to the taxpayer. Tax return information received electronically is protected through encryption.
Tax

Actor Wesley Snipes spars with tax prosecutors

Actor Wesley Snipes didn't pay federal taxes on $37.9 million in income from 1999 to 2004, according to documents filed ahead of the actor's tax fraud trial scheduled to begin on Monday in U.S. District Court in Ocala, FL, 80 miles northwest of Orlando. Snipes has attempted to delay his tax-evasion trial by having his lawyer, Robert Barnes, file a motion to move the trial from the central Florida city, only to have those attempts denied Tuesday by a federal appeals court in Atlanta. The actor's legal team argued that Snipes cannot get a fair trial in Ocala.
Tax

Lawrence Summers announced as TCPI keynote speaker

The Tax Council Policy Institute (TCPI) has announced that Lawrence H. Summers, an expert on domestic economics and a leading authority on international finance, will deliver the keynote speech at its 9th Annual Tax Policy and Practice Symposium, scheduled for Feb. 20-21, at The Ritz-Carlton Hotel in Washington, D.C. "Larry Summers is one of the most distinguished voices in America today on issues ranging from the global economy to education to the United States' role in the world," said Roger LeMaster, Executive Director of TCPI.
Tax

IRS gives taxpayers greater control over records held by tax preparers

The Treasury Department and the Internal Revenue Service have released final regulations and a related revenue procedure giving taxpayers greater protection and control over their tax return information held by tax return preparers. Treasury and the IRS also issued a separate request for public comment on a proposal to restrict the marketing of refund anticipation loans and similar products.
Tax

Toronto must pay for tax campaign

The City of Toronto, Ontario, hoping to raise taxes by imposing a new one cent tax on municipal services, has so far generated a cost to the city of nearly $50,000.In an effort to bolster enthusiasm for the tax increase last fall, city officials launched a city-wide campaign, complete with posters, bumper stickers, buttons, and a catchy slogan: "One Cent of the G.S.T. NOW." Promotional items showed an image of the Canadian penny. The promotion included a dedicated telephone number (416-ONE-CENT) and Web site (www.OneCentNow.ca).
Tax

New research provides resources on fraud prevention and financial reporting

Financial Executives Research Foundation (FERF), the research affiliate of Financial Executives International (FEI), has announced the release of two important new pieces of research designed to aid public company management and corporate boards in the efficient evaluation of their assessment of reporting issues and internal controls.A new FERF Study, entitled "What's New in Financial Reporting: Financial Statement Notes from Annual Reports," examines disclosures from 2006 annual reports for the 100 largest publicly-traded companies which used particularly innovative techniques to clearly a
Tax

IRS issues new Social Security form for misclassified workers

The Internal Revenue Service has developed a new form for employees who have been misclassified as independent contractors by an employer. Form 8919, Uncollected Social Security and Medicare Tax on Wages, will now be used to figure and report the employee's share of uncollected social security and Medicare taxes due on his or her compensation.Generally, a worker who receives a Form 1099 for services provided as an independent contractor must report the income on Schedule C and pay self-employment tax on the net profit, using Schedule SE.

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