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Tax

AICPA Identifies Three Goals for IRS Strategic Plan

The principal strategic goals of the IRS over the next five years should be to continue to build on the agency’s reorganization, to support the information technology modernization efforts, and to strengthen enforcement activities, the American Institute of Certified Public Accountants (AICPA) said at a meeting of the IRS Oversight Board.Improved communication was highlighted by Mark VanDeveer, chair of the AICPA’s IRS Practice and Procedures Committee, as a necessary central feature for the IRS’s next five-year strategic plan in order for the agency to successfully build on the restr
Tax

Fraudulent E-Mail Schemes Warning From the Treasury Department

Recently, many Americans have received a series of fraudulent e-mails which direct recipients to websites where they are asked to verify sensitive personal information. The e-mails claim that the individual’s personal information is necessary to assist in the fight against terrorism or for some other purpose supposedly required by law.
Tax

Treasury Department Issues Depreciation Guidance

Just a reminder that last month the Treasury Department issued proposed, temporary, and final regulations to clarify which changes in depreciation are changes in method of accounting. These regulations and a revenue procedure also issued will provide certainty for taxpayers and reduce controversy. In recent years, uncertainty has existed regarding whether a change in the period of recovery of depreciable property was a change in method of accounting.
Tax

SEC Shuts Down Investment Company that Attracted NFL Players

Ware Enterprises and Investments Inc., which targeted blacks and Christians as well as nearly 20 NFL players, is nothing more than a Ponzi scheme, the Securities and Exchange Commission said Tuesday as it acted to shut down the Orlando-based investment firm.The SEC said the company got more than 600 people to invest about $16.5 million over three years by using religiously oriented pamphlets to attract vulnerable groups, the SEC said in its complaint.
Tax

IRS Reminds Taxpayers to Mail Returns to the Correct Address

As taxpayers begin to prepare their tax returns, the Internal Revenue Service notes that some may be sending their returns to a different service center than last year. Those who received a tax instruction booklet from the IRS in the mail and use the labels included with the booklet can be assured that their tax returns will go to the correct address.
Tax

New Tax Form For Corporate Returns Proposed

In an effort to increase the transparency of corporate tax return filings, the Treasury Department and Internal Revenue Service released a new proposed draft form, Schedule M-3, Net Income (Loss) Reconciliation for Corporations with Total Assets of $10 Million or More, for use by certain corporate taxpayers filing Form 1120, U.S. Corporation Income Tax Return.
Tax

KPMG Announces New Management to Tax Services Operations

James Brasher, 50, has been named Vice Chair - Tax Services for KPMG LLP, according to an announcement on Wednesday by Eugene D. O’Kelly, Chairman and Chief Executive. It was also announced that John Chopack, 56, has been named Vice Chair – Tax Services Operations. Both appointments are effective February 1, 2004."This is a first step in addressing the management changes we announced on January 12," O’Kelly said.
Tax

Grassley Okays GAO Investigation into CPA Firm Tax Shelter Transactions

In 2002, Sen. Chuck Grassley, chairman of the Committee on Finance, tried to amend the Sarbanes-Oxley accounting standards improvement bill to prohibit public auditors from rendering an audit opinion on the financial statement effects of any tax shelter arrangements that the auditing firm sells to an audit client. The initiative was meant to target shelters that have the potential to manipulate financial statement results, such as overstating profits or understating liabilities. Other senators blocked Grassley from offering his amendment.
A&A

IRS, Treasury to Shut Down S Corporation ESOP Abuses

This week, the Treasury Department and the IRS issued a ruling to shut down abusive transactions involving "S corporation ESOPs." The ruling makes these "listed transactions" for tax-shelter disclosure purposes.An employee stock ownership plan, or "ESOP," is a type of retirement plan that invests primarily in employer stock. Congress has allowed an "S corporation" to be owned by an ESOP, but only if the ESOP gives rank-and-file employees a meaningful stake in the S corporation.
Tax

ChevronTexaco Seeks $118 Million Refund Check from IRS

The ChevronTexaco Corp. says Texaco Inc. overpaid its federal income taxes and is suing the Internal Revenue Service for a $118.6 million refund.Texaco, which was bought by Chevron to form ChevronTexaco in 2001, said in court papers that it should have received tax deductions for some settlement payments it made under a 1988 consent order. The order settled the U.S. Department of Energy’s claim that Texaco had charged more for crude petroleum and refined petroleum products than federal price regulations allowed from 1973 to 1981.The lawsuit, filed Friday in U.S.
Tax

IRS Free File Opens Second Year; Improvements Detailed

The Internal Revenue Service, Treasury Department and the Office of Management and Budget unveiled a series of improvements last week designed to make the Free File program easier to use for more taxpayers. Now starting its second year, the Free File program lets millions of taxpayers prepare and file their federal taxes on-line for free.Free File, which is available at IRS.gov, gives taxpayers free access to the benefits of online tax preparation and e-filing. Filing taxes electronically is easy, fast and secure. And, people receive their refunds in half the time of a paper return.
Practice Management

Tips for Small Businesses to Protect Assets This Tax Season

Increased federal and state scrutiny of tax records in 2003 and budget deficits signal changes ahead for the recordkeeping practices of America's small businesses, according to Fiducial, an international provider of professional business and financial services. Fiducial says small businesses must pay close attention to recordkeeping this year, as the IRS steps up its auditing and enforcement efforts to reduce tax fraud and do its part to offset large budget deficits.
Tax

Need a Copy of Your Tax Return Information? Look No Further

Taxpayers have two easy and convenient options for getting copies of their federal tax return information - taxreturn transcripts and tax account transcripts - by phone or by mail.A tax return transcript shows most line items from the tax return (Form 1040, 1040A or 1040EZ) as it was originally filed, including any accompanying forms and schedules. It does not reflect any changes you, your representative or the IRS made after the return was filed.
Tax

WorldCom May be Able to Sue KPMG, Citigroup

Already under investigation by the Internal Revenue Service (IRS) for recommending questionable tax shelters, KPMG LLP could now face a lawsuit by WorldCom over what a report called "flawed advice."U.S. Bankruptcy Judge Arthur Gonzalez ordered the report by former U.S. Attorney General Richard Thornburgh, who delivered what some are calling a roadmap whereby WorldCom could potentially sue KPMG and Citigroup.
Tax

Freddie Mac to Spend $200 Million to Address Accounting Issues

Freddie Mac officials testified before the House Financial Services subcommittee on government-sponsored enterprises and let lawmakers know that the agency expects to spend upwards of $200 million to correct accounting problems that led to a $5 billion restatement of earnings last year.Freddie Mac, the nation’s No. 2 mortgage finance company, replaced its top three executives last June in the wake of an accounting investigation.
Tax

E-mail Scam Cites Homeland Security, FDIC

The Federal Deposit Insurance Corporation (FDIC) and the FBI are investigating the source of fraudulent e-mails that claim bank deposit insurance will be suspended in the name of national security.The e-mail tells recipients that Department of Homeland Security Director Tom Ridge has advised the FDIC to suspend all deposit insurance on the recipient’s bank account because of suspected violations of the USA PATRIOT Act, which gives law enforcement wide-ranging powers to combat terrorism.
Community News

CPA Turns to Toys and TVs to Help Him Compete

Wooing customers away from the giants of the tax preparation industry is never easy, but one creative CPA in Tennessee is hoping toy trains, Teletubbies and teddy bears will give him an edge.Stephen Nestor, with four children of his own, knows how hard it is to cart the kids from activity to activity while also running the necessary, but boring, errands of everyday life — filing taxes, for one."My wife can't seem to go anywhere without taking kids with her," Nestor told the Tennessean.
Tax

Former Enron Chief Accountant Faces Criminal, Civil Charges

Andrew Fastow’s alleged partner in Enron crime pleaded not guilty yesterday to six criminal charges handed up in an indictment by a federal grand jury looking into the collapse of what was the nation’s seventh largest company.Richard A. Causey, 44, who was the energy giant’s chief accountant during the years in which massive fraud allegedly occurred, is accused of five counts of securities fraud and one count of conspiracy to commit securities fraud.
Technology

Goldman to Refund $9.5 Million to MCI

In a case of what might be called too little, too late, MCI will recoup $9.5 million it paid to Goldman Sachs for advice just prior to filing for bankruptcy in the wake of a massive accounting fraud at the company then known as WorldCom.Goldman was hired in 2002 to help with raising capital, arranging financing, discussing mergers and selling company assets, the Associated Press reported. A settlement between Goldman and MCI was reached in December was approved yesterday by U.S. Bankruptcy Judge Arthur J. Gonzales, who is supervising MCI’s Chapter 11 proceedings in New York.
A&A

The Top 10 Scams, Schemes & Scandals for 2004

State securities regulators forecast that investors will be challenged with increasingly complex and confusing investment frauds and identified the Top 10 schemes investors are likely to see in 2004. New to the NASAA annual survey of state securities enforcement officials are mutual fund practices, senior investment fraud, and variable annuities.“Investors face a complex maze of scams, schemes and scandals," said Ralph A. Lambiase, NASAA's president and director of the Connecticut Division of Securities.

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