Legislation

Tax

Greenspan, Snow Set to Testify in Fannie, Freddie Hearings

Legislation to tighten the reins on Freddie Mac and Fannie Mae are making their way through Congress, with three hearings set for this week.The mortgage giants, both chartered by Congress, are recovering from accounting scandals that resulted in orders for massive restatements and the ousters of top management.A Wednesday hearing is set before the House Financial Markets subcommittee on an agreement Fannie Mae reached with its federal regulator to make several changes to improve controls over its accounting procedures as well as to separate the chairman and CEO positions.

SEC Boss Chastises Attorneys Over Fund Scandal

Securities and Exchange Commission Chairman William H.
Tax

'Dual-Rate Income Tax' System is a Good Tax Code Fix

As the President's Advisory Panel on Federal Tax Reform begins meeting this week to discuss revamping the current tax code, a new Cato Institute study proposes a simpler alternative that would have most Americans paying just 15 percent.In "Options for Tax Reform," Cato Institute director of tax policy studies Chris Edwards addresses the unnecessary complexity and inefficiency of the present system and adds that the new tax code needs to reduce the size of government.

Study: Repealing Estate Tax Would Hurt More than Help

A Democratic tax expert contends that more people would be required to pay taxes at death if President Bush's plan to eliminate the estate tax becomes law.A permanent repeal of the estate tax, proposed by Bush, would result in up to 71,400 estates being subject to capital gains taxes every year starting in 2010, according to a report by John Buckley, chief tax counsel for the Democratic staff of the House Ways and Means Committee.The existing law would subject 7,500 estates to the estate
Tax

ACORN to Protest Liberty Tax's Refund Loan Practices

ACORN members will protest at Liberty Tax offices in more than 60 cities throughout the U.S. and Canada from Tuesday, February 1 to Friday, February 4 to demand that the tax preparer change its sales practices with Refund Anticipation Loans (RALs), which steals hundreds of millions of dollars from low-income communities every year.

CalPERS Sets Up Pension Debate Information Center

The California Public Employees' Retirement System (CalPERS) announced this week a special Web resource on proposals to privatize State and public agency pensions. "The Pension Debate Information Center" is intended to educate CalPERS members on existing programs and possible changes. The proposals call for an end to the traditional defined benefit pensions for employees hired as of July 1, 2007. New employees would be placed in defined contribution plans that cap employer contributions and let employees invest in 401(k)-type pension funds.

Canadian Accounting Group Takes Oversight Fight to U.S.

A disagreement over the creation of Canada's audit oversight board has reached the United States, as a Canadian accounting organization has hired a Washington lobbyist to battle the two-year-old board.The Canadian Public Accountability Board (CPAB) is the counterpart to the U.S. Public Company Accounting Oversight Board (PCAOB).
Tax

Measure Allowing Examination of Tax Returns Holds Up Spending Bill

Congress applied the brakes to a $388 billion spending bill as Republican lawmakers scurried to repeal a measure that would allow the Appropriations committees to examine Americans' tax returns. The Washington Post reported that Republican lawmakers said they were surprised that the provision had been included in the bill - a massive omnibus spending package that allocates government funding for next year.The bill also includes the Bush administration's proposed changes in overtime rules, which critics say will deny an estimated 6 million workers overtime pay.

SEC Faces Controversial Agenda, Possible Turn Over

The Securities and Exchange Commission's make up could change now that the election is over and proponents of some reform measures are hoping to see their agendas through the process before there are changes, the Washington Post reported.Among the most controversial items pending before the SEC is a year-old proposal that would give unhappy shareholders more authority to nominate candidates to sit on corporate boards, in some cases.While such high-power lobby groups as the U.S.
Tax

$100,000 'SUV Write-Off' to End for Small Businesses

Call it a tax break for the wealthy or a justifiable business expense, but whatever you call it, the SUV tax loophole is almost certain to be closed.Small business owners have been allowed to write off the full cost of heavy-duty vehicles, weighing at least 6,001 pounds when loaded, as a business expense.
A&A

Management Shakeup May Lie Ahead for Fannie Mae

Days after Fannie Mae's federal regulator released a highly critical report on the mortgage giant's accounting practices, observers say top management may not survive the fallout.Fannie Mae's regulator, the Office of Federal Housing Enterprise Oversight (OFHEO), conducted an eight-month investigation and found such pervasive problems that OFHEO suggested a management change.“These findings cannot be explained as mere differences in interpretation of accounting principles, but clear instances in which management sought to misapply and ignore accounting principles," OFHEO Director Armand
Tax

House Votes to Bar IRS From Outsourcing Tax Collection

The House of Representatives took a strong step this week in support of America's taxpayers by voting to keep their private and sensitive tax information out of the hands of debt collectors.The action came in bipartisan approval of an amendment to the 2005 Transportation-Treasury spending bill that would prevent the Internal Revenue Service from using any funds to contract with private sector debt collectors to collect tax debts. The Senate is considering a separate version of the spending bill.The amendment's sponsor, Rep.
Tax

SEC Supports Extension on Statute of Limitations on Fraud Cases

The Securities and Exchange Commission has asked a U.S. federal appeals court to allow investors to sue companies for fraud even if the alleged violation took place after the statute of limitations had expired. Investors have been allowed to file lawsuits within one year of discovering fraudulent behavior and three years after the violation occurred. The Sarbanes-Oxley Act of 2002 changed those time limits to two years and five years, respectively. However, investors who have recently alleged fraud have done so even though the three-year limit had expired.
Tax

Corporation Lobbies to Close Corporate Loophole

Kelly Services Inc. is credited with helping end a tax dodge that cost states more than $1 billion over the last decade.The loophole allowed companies to greatly reduce the money they paid to state unemployment trust funds. The federal State Unemployment Tax Act, or SUTA, directs states to set aside unemployment funds with taxes collected from employers.
A&A

New Law Means Speedy Clearing of Checks

If you regularly write a big check a few days before the funds are actually available in your checking account, it’s time to rethink your check-writing habits.The Check Clearing for the 21st Century Act, which goes into effect Oct. 28, will allow checks to clear in hours instead of days because a substitute check can be accepted as legal.
Community News

SEC Considers Extending 60-Day Reporting Rule

If companies comply with a new rule on internal controls, it will make it hard for them to speed up their year-end reporting as the SEC had mandated, the Wall Street Journal reported.As a result the SEC is considering a one-year extension for public companies complying with the new rule that makes annual reports due 60 days after their year-end rather than 75 days as it was in the past.Public companies and large accounting firms are in agreement that more time is needed if they are also going to comply with the new Sarbanes-Oxley based rule that requires improved internal controls over f

Treasury Issues Comprehensive Health Savings Account Guidance

Last week the Treasury Department and the IRS issued comprehensive guidance on Health Savings Accounts that will help providers to establish HSAs and consumers to enjoy their benefits. The guidance answers questions on a wide range of issues that the public has brought to the Treasury Department since the creation of HSAs.
A&A

Bill Would Expand Small Business Tax Break

Small businesses would receive a boost from legislation passed Wednesday by the U.S. House that would save small businesses $10.9 billion in taxes from 2006 through 2008, the Wall Street Journal reported. It is not clear how much support the measure has in the Senate.The House’s bill would extend a small business tax break that allows them to immediately write off up to $100,000 in capital purchases as a business expense.
Tax

Senator Snowe Introduces Bill to Expand Cash Accounting

U.S. Senator Olympia J. Snowe (R-Maine), chair of the Senate Committee on Small Business and Entrepreneurship, has introduced the "Small Business Cash Accounting Act of 2004," a bill to simplify the tax code and reduce compliance burdens placed on small businesses by permitting businesses that generally earn less than $10 million during the tax year to use cash accounting methods to report their income. Snowe's bill, S.
Tax

House Bars Export-Import Loans to Companies in Tax Havens

Companies that incorporate outside the United States to avoid taxes would no longer be eligible for Export-Import Bank loans under a House of Representatives proposal.“They don't want to pay taxes in America. Not them. That's for the suckers of this country,” said bill sponsor Rep. Bernie Sanders, a Vermont independent.The House on Wednesday voted 270-132 to add the amendment to an annual foreign aid bill, Bloomberg reported. The government-backed Export-Import Bank provides loans to U.S.

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