Legislation

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.
A&A

Congress Grapples with Stock Option Issue

Is history going to repeat itself? Will Congress move as it did 10 years ago to undercut the authority of the Financial Accounting Standards Board (FASB), which is authorized by the Securities and Exchange Commission to set U.S accounting standards?For the second time in a decade, Congress is taking up the mandatory expensing of stock options, a controversial recommendation by FASB, which could be a direct hit to the bottom lines of many U.S. companies who use the options as a form of employee compensation.
A&A

Oxley: Congress Belongs in Stock Option Debate

Stock options. Two little words that pack a big economic punch, so big that Congress is getting more involved in an ongoing debate on how companies should show the options on their financial statements.The term "stock options" refers to the practice of giving employees the option to buy or sell company stock at a fixed price in the future and is at the heart of a battle shaping up that pits Congress against the Financial Accounting Standards Board (FASB), which sets accounting standards for the private sector. Rep.
Tax

The Toll Of Two Taxes: The Regular Individual Income Tax And The AMT

The alternative minimum tax (AMT) is a second income tax system that runs parallel to the regular individual income tax. First enacted in the late 1960’s, the AMT was intended to target a small group of high-income individuals – who had managed to avoid all taxes – to ensure they paid a minimum amount of tax. Changes since the AMT’s original enactment mean that today it reaches into the ranks of the middle class, potentially denying them the benefit of many of the deductions, credits, and lower tax rates available under the regular income tax system.
Technology

Senate Bill Would End Internet Access Taxes

It’s all very confusing. Whether or not you pay taxes on your high-speed Internet connection has everything to do with how you connect — phone line, cable or digital — as well as what state you live in.While each service is comparable in access to the Internet, only telephone data lines are charged access taxes in 18 states, a tax that a bill pending in the Senate would repeal permanently.Sen. George Allen (R-VA), sponsor of the bill, told the New York Times that it is unfair to charge a tax on one form of Internet access but not others.
Tax

Utah and Washington Make Federal Health Coverage Tax Credit Available

This week, Treasury Secretary John Snow applauded Governor Walker and Governor Locke for implementing a state qualified health plan option under the federal Health Coverage Tax Credit Program (HCTC) that will help cover the cost of health insurance premiums for many Utah and Washington residents.The Trade Adjustment Assistance Act President Bush signed into law in 2002 included the new Health Coverage Tax Credit (HCTC). Recipients can receive the HCTC either in advance, to help pay qualified health plan premiums as they come due, or in a lump sum when they file their federal tax returns.
A&A

As Stock-Option Rule Nears, Opponents Turn up Heat

The Financial Accounting Standards Board (FASB) is soon expected to require companies to expense stock options like other forms of compensation, but opponents are fiercely lobbying Congress to block the new rule.The anticipation of FASB action, which could come this week, has "galvanized the effort" said Jeffrey Peck, a lobbyist and consultant to the International Employee Stock Options Coalition.
Tax

Maryland Takes Steps to Close Delaware Tax Loophole

Delaware has long been known as a tax haven for companies that set up holding companies as tax shelters in the state. The Maryland House of Delegates passed a bill this week that would close the loophole that makes it possible for Maryland companies to use the Delaware tax shelter. The Senate passed a similar bill last week, the Baltimore Sun reported.Maryland Gov. Robert L. Ehrlich Jr.
A&A

Big Four Accounting Firms Express Their Support of the FASB to Congress

On Wednesday, PricewaterhouseCoopers (PwC), along with the other "Big Four" accounting firms sent a joint letter to members of Congress regarding the independence of the Financial Accounting Standards Board (FASB).
Tax

Who Deserves a (Tax) Break Today?

What do adoptive parents, historic barn restorers and food bank supporters have in common? They’re all eligible for tax credits in certain states.Now some New York legislators want to give tax credits to nurses, volunteer firefighters and residents who buy gym memberships. While some say the proposed legislation is a good way to encourage socially responsible behavior, critics say it complicates the tax system and is less honest than simply giving such groups money outright.

CEO Survey Shows Continuing Improvements in Corporate Governance Practices

The Business Roundtable, an association of CEOs of 150 leading U.S. companies, today released its secondannual survey of corporate governance practices among its members.The new results show strong progress from the solid findings in the initial CEO corporate governance survey last July.
Tax

IRS Gives Investors the Benefit of Pending Technical Corrections on Qualified Dividends

The Treasury Department and the Internal Revenue Service have agreed to make certain provisions of the Tax Technical Corrections Act of 2003 related to dividend income available to taxpayers in advance of its passage.

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