Tax news April 2009

Tax

Non-profit officers face May deadline

Officers signing their non-profits' radically revised IRS Form 990 this year may want to read the small print on risking perjury by making false statements about filing at the state level for fund-raising and other activities, according to Martignetti Planned Giving Advisors, LLC, a New York-based consultancy group that advises non-profits. "Charity registration and licensing throughout the 50 states has long been a regulatory morass that most non-profits avoided or ignored.
A&A

FASB to issue new FIN 48 guidance

FASB will issue a proposed staff position for FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, for pass-through and tax exempt not-for-profit entities. Once released, the FSP will be available for a 30-day comment period.FASB also decided:Not to provide guidance related to whether a tax is or is not an income tax. That attribution of the income tax to the entity or its owners should be based on the laws and regulations of the taxing authority rather than on who is responsible for payment of the income taxes.  
Tax

Jail for accountants in tax shelter case

A former senior manager and a former partner of KPMG who left the Big Four firm more than a decade ago to form their own business were sentenced and fined millions of dollars earlier this month after being convicted in December of selling illegal tax shelters that helped their clients avoid paying millions.In Manhattan Federal Court, former senior manager John Larson was sentenced to a decade in prison and fined $6 million. Former KPMG tax partner Robert Pfaff was sentenced to eight years and ordered to pay $3 million.
Tax

7 Things small business owners should know about payroll tax problems

Past due payroll taxes can cause you to lose your business and in some cases, your freedom. The IRS is focusing increased tax compliance efforts on small businesses so it is important to know the common payroll tax audit triggers and learn how to avoid severe IRS penalties, huge tax debt and federal criminal investigation.Small businesses are the most likely target of increased tax compliance enforcement. Small business owners have been identified by the IRS as the largest source of uncollected taxes.
Tax

IRS clarifies tax treatment of ESOP distributions

The IRS has issued guidance to companies making distributions from an Employee Stock Ownership Plan (ESOP) to participants who have been terminated from the plan.Some ESOP companies allow, or even require, terminated plan participants who receive distributions of company stock to sell that stock back to the company.
Tax

Helping your clients survive the dreaded audit: Tips from the IRS

In March, a panel of IRS officials and Enrolled Agents answered common questions that tax practitioners have about helping their clients through the audit process. At the end is a link to TaxTalkToday where you can read the full transcript (registration required).What if the type of audit the IRS has scheduled is not conducive to solving the problem?
Tax

Procrastinators take heart: The experience of the late tax filer is universal

For all you procrastinators out there who look upon April 15th with a dread similar to what George Bailey felt when the IRS showed up in Bedford Falls, you are not alone.TurboTax has released its annual list of the top 10 procrastinating cities and after all the last minute electronic tax filings have been tallied, Chicago leads the country in procrastinators. But the reach of the procrastinator stretches across the country with New York City, Houston, Austin, San Francisco, San Diego, Seattle, Las Vegas, San Antonio, and Los Angeles rounding out the top 10.
Tax

U.S. and Switzerland begin negotiations for tax information exchange

The U.S. Department of the Treasury has announced that the United States and Switzerland will begin negotiation of a protocol to amend their bilateral income tax treaty, which entered into force in 1996. Consistent with the announcement made by the Swiss Federal Council on March 13, 2009, the two countries intend to revise the tax treaty so the two countries can exchange information for tax purposes to the full extent permitted by Article 26 of the Organization for Economic Co-operation and Development (OECD) Model Income Tax Convention.
Tax

Alexis Stewart, Martha's daughter, suing CPA over tax return

Alexis Stewart, the daughter of world-famous Martha Stewart, is suing her accountant over a tax return that she said contained mistakes costing her hundreds of thousands of dollars.A radio and TV host, Stewart, 43, filed a lawsuit earlier this month contending that CPA Michael Mirras, who she hired to do her 2002 tax return, miscalculated the amount she owed the IRS, according to the Washington Post.
Tax

Morton's Steakhouse appreciates CPAs

On Thursday April 16th lucky CPAs in locations around the country were rewarded for their hard work with a complimentary Steak and Seafood Dinner for Two by Morton's, the Steakhouse. "We wanted to celebrate them for all the hard work they do especially at tax time," said Roger Drake, vice president of Morton's Restaurant Group. CPAs were invited to submit their names to their local restaurant, or in some cases, friends in their offices suggested names, Drake said, for Morton's CPA Appreciation Day. One winner was selected randomly on April 15th.
Tax

Castroneves found not guilty of tax evasion

By midday Friday it looked like Helio Castroneves would be biting his nails through the weekend, waiting for the jury to continue deliberating this week. But by the end of the day Friday... he walked out of the courthouse, free. After six weeks of trial and another six days of deliberation, the jury deadlocked on the key charge of conspiracy. U.S. District Court Judge Donald Graham declared a mistrial on the conspiracy charge and told Castroneves he was free to go. On his way out people everywhere, including court officials, congratulated him. "Go get 'em, Helio," said a U.S.
Tax

Castroneves tax trial diary - The wait is over

Friday, April 17, 2009Helio Castroneves and his sister Katiucia have been acquitted on all counts of tax evasion. The jury remained hung on one conspiracy charge against each of the Castroneves defendants. Castroneves's Michigan lawyer, Alan Miller, was acquitted on the conspiracy count and three counts of tax evasion. Friday, April 17, 2009For a second time, the Castroneves defense team has filed a motion for a mistrial, and for a second time, Judge Donald Graham denied the request.
Tax

Have you been scammed? IRS publishes list of 'Dirty Dozen' tax scams

The Internal Revenue Service has issued its 2009 "dirty dozen" list of tax scams, including schemes involving phishing, hiding income offshore and false claims for refunds."Taxpayers should be wary of scams to avoid paying taxes that seem too good to be true, especially during these challenging economic times," IRS Commissioner Doug Shulman said. "There is no secret trick that can eliminate a person's tax obligations.
Tax

Anti-tax tea parties protest taxes and spending

Anti-tax tea parties scheduled for Tax Day took their inspiration from the nation's original tax revolt, the Boston Tea Party. Protesters at tea parties and rallies throughout the country want to send Washington a clear message that many Americans are outraged about increases in government spending, taxation, and the deficit. TEA is the acronym for Taxed Enough Already. Thousands rallied around the country. The National Tax Day Tea Party brought 5,000 to the state capitol in Olympia, Washington.
A&A

Top 9 confusing business deductions

It's tax time, which means almost 21 million self-employed people are preparing to fill out their tax returns, including Schedule C: Profit or Loss from Business. Should be pretty easy - just enter how much money came in and went out of your business last year. Right?
Tax

Earliest Tax Freedom Day in 42 years!

Taxes are due as usual, on April 15th. But for the first time in decades, Tax Freedom Day – the day that Americans will have earned enough money to pay their federal, state, and local tax bill for the year – falls before the tax due date. This year, it's on April 13th. The last time Tax Freedom Day occurred earlier in the year, on April 12th to be exact, Lyndon Johnson was president, and the year was 1967.Why is Tax Freedom Day so early this year?
Practice Management

Don't let trade secrets leave with employees

Desperate times can sometimes result in desperate measures. During an economic downturn, the pressure to generate revenue can be great. Economic espionage can result when employees are forced to come up with the next big idea or they have financial difficulties. Economic espionage is defined as the theft or misappropriation of trade secrets.
Tax

IRS to hire more employees for corporate, international compliance

In an economic downturn when few companies are hiring, one federal agency plans to embark on its largest hiring initiative in recent history – the IRS will hire more than 3,500 enforcement employees.Within that total will be more than 2,000 new revenue agents and revenue officers, said Deputy Commissioner for Services and Enforcement Linda E. Stiff.
Tax

Snipes violated court order but gets a pass

Updated April 3, 2009 - Last July, Wesley Snipes was acquitted of the worst of the tax evasion charges against him, but was still sentenced to 36 months in prison and ordered to pay a $5 million fine. Snipes remains free on bail while he appeals the decision, but Senior U.S. District Judge William Terrell Hodges limited Snipes's foreign travel to London and Bangkok while the actor completed work on movies. In November, Snipes violated that restriction by attending a party for a resort opening in Dubai.
Tax

Tax partner at major international firm charged with tax crimes

A Newark, NJ, federal grand jury has returned an indictment charging Stephen A. Favato, a resident of Point Pleasant Beach, NJ, and a partner at a major international accounting firm, apparently, BDO Seidman, with tax charges for attempting to assist one of his clients evade income taxes, the Justice Department and Internal Revenue Service (IRS) announced Wednesday.

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