Legislation

A&A

House Passes Bill Allowing More Child Care Savings

The House passed a bill on Tuesday that would allow families to keep unspent money they saved that year in tax-free child care accounts.Currently, employees have to give up any money that remains unspent in their flexible spending accounts at the end of the year. Under the bill, passed by voice vote, families will be able to roll over up to $500 in unused child care savings to the next year, the Associated Press reported.Flexible spending accounts are offered by employers so families can set aside pre-tax money for health care or child care expenses.

Accenture Contract Moves Forward

It became less likely Friday that Congress would punish Accenture for being incorporated in Bermuda when lawmakers voted to give the consulting firm part of a $10 billion Homeland Security Department contract, MarketWatch.com reported.The five-year Homeland Security contract comes with an option for a five-year extension and involves a system called US-Visit, which will track non-citizens through digital finger scans and photographs taken at more than 400 air, sea and land points of entry.Accenture’s parent corporation is nominally incorporated in Bermuda, some say so the company can d
Tax

IRS Confirms it is Unlawful for Same-Sex Married Couples to File Jointly

In response to an inquiry about tax filings, the Public Advocate of the United States, Inc. received a letter from the Internal Revenue Service (IRS) confirming that it is unlawful for same-sex couples to file their taxes under any married status, even if the jurisdiction in which the couple lives, recognizes such a union.The text of the letter is as follows:Mr. Eugene A. DelgaudioPresidentPublic Advocate of the United States, Inc.5613 Leesburg Pike, Suite 17Falls Church, VA 22041-2912Dear Mr.
Tax

Perk-Heavy Tax Bill for Corporations Gets Nod from House Panel

The House Ways and Means Committee has approved a bill that would give corporations huge tax benefits while repealing a tax break on exports that was ruled illegal by the World Trade Organization.The European Union has levied harsh tariffs on U.S. goods as a response to the Extraterritorial Income export-tax regime. The House bill attempts to swap the now-illegal export subsidies with new tax breaks for business. The bill would lower the top tax rate for U.S.

New White Paper Examines Business of Law and Sarbanes-Oxley Impact

New trends within the legal profession are reshaping the practice of law as law firms rethink their traditional structures and employ corporate business models to enhance client service, streamline operations and manage growth. These key findings are made available by Robert Half Legal, a legal staffing service specializing in attorneys, paralegals and other highly skilled legal professionals, in a just-released white paper titled "New Perspectives on the Business of Law." The white paper is part of the company's continuing Future Law Office project.
Tax

Senate Passes Tax Administration Overhaul Bill

Taxpayers will have more time to fight IRS levies, be allowed to make partial installment payments and deal with a less-complicated tax code under a measure passed unanimously by the Senate.The bill gives taxpayers more rights, overhauls tax administration, clarifies the definition of "qualifying child" for the Earned Income Tax Credit and eliminates more than 60 obsolete tax code rules, the Wall Street Journal reported.

Strong Capital Management Executives Barred from Mutual Fund Industry, Fined $140M

The Securities and Exchange Commission announced today a settled enforcement action against Strong Capital Management, Inc. (SCM), its founder and majority owner, Richard S. Strong, two affiliated entities and two other SCM executives, for allowing and, in the case of Strong, engaging in undisclosed frequent trading in Strong mutual funds in violation of their fiduciary duties to the Strong funds and their investors. The settled order requires the payment of more that $140 million in monetary remedies, and imposes regulated industry bars and other reliefStephen M.
Tax

E-mail Scammer Gets Stiffest-Ever Penalty for Online Fraud

A Houston man who fooled e-mail recipients into turning over 473 credit card numbers was sentenced Tuesday to almost four years in jail, one of the toughest penalties ever handed down for online fraud.U.S. District Court Judge Vanessa Gilmore in Houston gave Zachary Hill, 20, "one of, if not the longest-ever" sentences against an e-mail scammer, Justice Department spokesman Michael Kulstad told the Washington Post. Hill used a so-called "phishing" scheme to make his e-mail look like it came from Internet service provider America Online or PayPal, which eBay uses for online payments.
A&A

House Subcommittee Votes to Dilute Stock Option Rule

Congress may once again stymie the Financial Accounting Standards Board (FASB) efforts to require companies to show stock options as an expense on company financial statements. A decade ago Congress forced the accounting standards setting board to settle for footnotes in the financial statements addressing stock options. This time, Congress may end up requiring that only the options paid to a company’s top five executives be shown as an expense.The controversial FASB proposal was considered last week by a House Financial Services Subcommittee, taking up a bill sponsored by Rep.

PCAOB Auditing Standard No. 1 Effective May 24

The Public Company Accounting Oversight Board announced that its Auditing Standard No. 1, References in Auditors' Reports to the Standards of the PCAOB, has been approved by the U.S. Securities and Exchange Commission. PCAOB Auditing Standard No. 1 requires that auditors' reports on audits and other engagements relating to public companies and other issuers include a reference that the engagement was performed in accordance with the standards of the PCAOB. This replaces the previous reference to generally accepted auditing standards.

Regulatory Burdens of Nation’s Community Banks Topic of Testimony

Abernathy Testimony before the House Financial Services Financial Institutions and Consumer Credit Subcommitte: Chairman Bachus, Ranking Member Sanders, and Members of the Financial Institutions and Consumer Credit Subcommittee, I would like to thank you for this opportunity to testify on the regulatory burden faced by the nation’s community banking institutions.Small banks and thrifts provide households and small businesses services that are greatly valued by the communities in which they are located, particularly for the continuity of service that they present as well as for the
Tax

Wave of Tax Shelters could be Unleashed in the Coming Weeks

Source: Multistate Tax Commission (MTC) The Multistate Tax Commission (MTC) warned this week that H.R. 3220 (Business Activity Tax Simplification Act of 2003) would legalize controversial tax shelter schemes.The bill would allow income-shifting games made notorious by a handful of companies in order to avoid paying taxes to state governments, which are still shaky in the wake of the recent economic recession. Slated to be the subject of a U.S.
Tax

10 Percent Bottom Tax Bracket May Be Here to Stay

The House on Thursday extended the bottom tax bracket that was created by President Bush’s tax cuts in 2001 and then expanded two years later.Tax on the first $6,000 in earned wages was lowered from 15 percent to 10 percent in 2001, then broadened in 2003 to cover the first $7,000 earned. The bill passed 344-76, with strong Democratic support despite worries about the ballooning federal deficit, the Associated Press reported.Without this legislation, those who fall into the 10-percent tax bracket will be pushed into a 15-percent tax bracket by 2011.
Tax

Bill Closes Loopholes, Includes Corporate Tax Cuts

Bonanza for special interests or the jumpstart needed to create new jobs? A bill passed this week in the Senate is probably a little of both as it attempts to replace subsidies with tax breaks for corporate America.The bill approves $170 billion in corporate tax cuts over the next decade to take the place of export subsidies that used to be given to U.S. companies. The World Trade Organization outlawed about $5 billion of the subsidies and the European Union retaliated by slapping $4 billion in on U.S.-made products, the Washington Post reported.

Another Whistleblower Wins Case Under Sarbanes-Oxley

New whistleblower rules outlined by the Sarbanes-Oxley Act have resulted in a favorable judgment for a former Atlantic Coast Airlines employee who was fired after raising concerns about pilot fraud, the Associated Press reported.Stacy Platone was the airline’s labor relations manager before being fired last year. An administrative judge awarded back pay and lawyer fees after finding in her favor.
Tax

IRS Issues Guidance On Capital Gain Dividends

The IRS and the Treasury Department this week issued guidance to clarify that capital gain dividends received from a mutual fund in 2004 will be taxed at the new, lower capital gain rates enacted last year.The lower rates are currently only legislated through 2008. The maximum tax rate on net capital gain has been reduced to 15 percent from 20 percent for most tax payers, and reduced to five percent from 10 percent for taxpayers in the 10 percent and 15 percent tax brackets for property sold or otherwise disposed of after May 5, 2003.
A&A

FASB Considers Costs to Small Businesses in Stock Option Issue

When final rules are adopted requiring expensing of stock options, small businesses may get different treatment than big corporations, according to the chair of the Financial Accounting Standards Board.At a congressional hearing Tuesday, FASB Chairman Robert Herz defended the board's March recommendation for mandatory expensing, but noted that the board is concerned about a "cost-effective" approach to small businesses.
Community News

Oxley Covers SOX, Stock Options and Mutual Fund Issues

It’s been two years since Congress passed sweeping reform legislation intended to clean up corporate accounting and stem the wave of fraud that swept through corporate America. Now one of the Sarbanes-Oxley Act sponsors wants to know if the legislation is working as intended.Rep.
A&A

CCH Employment Law Briefing Analyzes Overtime Rules

The Department of Labor has issued a far-reaching revision of the basic rules on who does and who doesn’t qualify for overtime pay under the Fair Labor Standards Act (FLSA), the federal wage-hour law, but has stepped back from an earlier, more fundamental reworking of the law, according to CCH INCORPORATED, a leading provider of human resources and employment law information. The proposed changes are expected to cost employers approximately $700 million to implement, but then produce savings of more than $1 billion annually.

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