Personal Finance

A&A

GASB Issues Technical Bulletin to Clarify Pension Accounting

The Governmental Accounting Standards Board (GASB) has published a proposed staff Technical Bulletin, Recognition of Pension and Other Postemployment Benefit Expenditure/Expense and Liabilities. The proposed guidance would clarify requirements on accounting for employers’ contributions to pension and other postemployment benefit (OPEB) plans in Statement No. 27, Accounting for Pensions by State and Local Governmental Employers, and Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions.
Tax

Alabama Pension Fund Nets $111M From WorldCom Settlement

As the Alabama state pension fund waits to see what will happen with U.S. Airway's bankruptcy filing, the fund received a $111 million settlement from three companies over claims in the WorldCom collapse, the Associated Press reported.The Retirement Systems of Alabama achieved majority shareholder status in U.S. Airways when it bought into the company in December 2002 while the airline was previously in bankruptcy. The airline once again filed for bankruptcy protection Sept. 12."Would I do it again? Absolutely," said Alabama pension system chief David Bronner.

Help Your Clients Take Control of Their Retirement Assets

By Jim Wagner, President & CEO, Trust Administration Services - Do you have clients that are frustrated with their retirement plans because of limited investment options or poor investment performance? Today many accountants are finding the answer to this question is a resounding YES.It is easy to understand why. It is estimated that investors lost in excess of $7 trillion in the equity markets from 2000 to 2002.

Consumers Don't Understand Their Credit Scores, Do You?

As companies and organizations increasingly utilize credit scores to evaluate individuals as prospective customers, employees or tenants, it is essential that consumers know their credit score, understand what it means, and learn how to raise it. But according to a new survey developed by the Consumer Federation of America (CFA) and Providian Financial, most Americans do not understand credit scores even when they think their knowledge of credit is good.
Community News

Financial Planner, CPA Join Forces to Assist Clients

Accountants are often allowed to sell financial products, but most hate it. Financial planners enjoy selling, but maybe too much.According to CPA Nick Hodges and financial planner Keith Offel, a different philosophy is required to help clients solve their problems.
Education & Careers

GAO Report: Subsidy Payments To Student Loan Lenders Rising

To encourage lenders to make student loans under the Federal Family Education Loan Program (FFELP), the federal government guarantees lenders a statutorily specified rate of return—called lender yield. Some lenders mayissue tax-exempt bonds to raise capital to make or purchase loans; loans financed with such bonds issued prior to 10/1/93 are guaranteed a minimum lender yield of 9.5% (hereafter called 9.5% loans). When the interest rate paid by borrowers is less than the lender yield, the government pays lenders the difference—a subsidy called special allowance payments.
Community News

SEC Under Fire Over Implied Rule

Financial planners are crying foul and asking the Securities and Exchange Commission to crack down on brokers who offer fee-based accounts and investment advisory services without having to follow the same strict rules required of financial planners, Dow Jones reported.The SEC has received more than 900 letters from financial planners urging resolution of an issue that has been around for years."These brokers are trying to provide essentially the same services that I provide as a financial planner," wrote Charles O'Connor, who runs a Torrance, Calif., advisory firm, and reported by Dow J
Tax

Charles Schwab Settles Mutual Fund Probe for $350K

On Tuesday, the Securities and Exchange Commission (SEC) announced that it has instituted settled enforcement proceedings against San Francisco-based broker-dealer Charles Schwab & Co., Inc. The Commission charged that Schwab allowed investment adviser customers to change mutual fund orders after the 4:00 p.m. Eastern time market close, creating the risk that such customers could unfairly capitalize on late-breaking news at the expense of other mutual fund investors.
Tax

Pimco Settles Fraud Charges for $50 Million

The Securities and Exchange Commission this week announced that PA Fund Management LLC (PAFM), PEA Capital LLC (PEA), and PA Distributors LLC (PAD) (collectively, the PIMCO Entities) agreed to a settlement of charges that they defrauded investors in the PIMCO Funds: Multi-Manager Series in connection with an undisclosed market timing arrangement. Under the settlement, the PIMCO Entities have been ordered to pay $50 million, consisting of $10 million in disgorgement and a civil penalty of $40 million.
Tax

NASD Examines Disclosure in 529 Plan Sales

Reuters reported Monday that as many as 20 securities firms are under examination by the National Association of Securities Dealers (NASD) for possible fee and disclosure issues involved with the sale of popular “529 plans.”The 529s, established in 1997, are tax-free college savings plans that are run by the states and allow for earnings that are not subject to federal income tax when the earnings are used to pay for college.
A&A

Democrats, Unions Hail Vote Against New Overtime Rules

Democrats were joined by 22 Republicans Thursday to block new overtime regulations that critics say would deny overtime pay for at least 6 million workers.The vote was 223-193, defying a veto threat from the White House. The sweeping overtime rules were attached as an amendment to a $142 billion measure funding education, worker training and health programs.The administration believes the rules would improve overtime protection for many more workers than would lose them, the Los Angeles Times reported. The U.S.

Employers Use Housing Perks to Recruit, Retain Workers

With housing costs exploding across the country, “affordable housing” has taken on a whole new meaning.The term used to be associated with low-income housing, but no more. The middle class - firefighters, teachers, police officers, nurses, sales clerks and more - are increasingly unable to afford homes in the communities where they work.Employers are turning to housing benefits in growing numbers to attract talent and keep the workers they have, USA Today reported.
Tax

KPMG Tax Shelters Under Scrutiny Again

A series of e-mails dating from the mid-1990s to 2003 show that even after KPMG was ordered by the Internal Revenue Service to stop pushing tax shelters considered abusive, the Big Four firm continued to promote at least a dozen new similar shelters, the New York Times reported.New documents issued Monday by the Senate subcommittee looking into the abusive shelters, show that KPMG was continuing to develop tax shelters similar to those deemed abusive, but do not indicate whether the new tax shelters were ever actually sold, the Times reported.
Tax

IRS, Treasury Issue Proposed Estate-Tax Rules

The Treasury Department and Internal Revenue Service (IRS) issued guidance addressing the requirements for a "qualified severance" of a trust for purposes of the generation-skipping transfer (GST) tax. "We are pleased to be able to provide guidance in this complex area of the law," stated Acting Assistant Secretary for Tax Policy Greg Jenner.
A&A

Uniform Trust Code Sparks Privacy Concerns

State-by-state actions to adopt an updated, standardized set of trust rules are triggering fears of privacy violations.The Uniform Trust Code, or UTC, is designed to clarify sometimes-confusing trust laws, which differ from state to state, the Wall Street Journal reported. Legal observers said a national codification of the trust laws should simplify matters for trust creators, trustees and heirs.The UTC has already been approved in 10 jurisdictions.
A&A

New Faces in Bankruptcy Court: The Middle-Aged

Just when many baby boomers expected to be settling into their comfortable homes earned from a lifetime of hard work, they’re finding themselves in bankruptcy court instead.The reasons are numerous; the circumstances complicated. Bankruptcy attorneys are accustomed to helping young people who have overextended themselves with credit card debt and the expenses of starting a new home and family. The faces they see now, however, are lined with a history of hard work and the burden of caring for both their children and their parents.
A&A

Federal Pension Agency May Have Money Belonging to You

If you know someone who is retired from the airline, steel, transportation, machinery, retail trade, apparel and financial services industries and lives in New York, California, Texas, New Jersey or Pennsylvania, there's a possibility that pension money belonging to them is being held by the Pension Benefit Guaranty Corporation, Reuters reported.While most of the $75 million in unclaimed benefits due to 26,000 people the agency can't find comes from those industries and belongs to people living in the above states, the benefits aren't confined to these areas.
Tax

Treasury, IRS Finalize Regulations for Incentive Stock Options (ISOs)

Earlier this week, the Treasury Department and the IRS issued final regulations on incentive stock options ("ISOs"). These regulations finalize, with modest changes, regulations proposed in 2003.ISOs provide employees with the ability to acquire employer stock without realizing income when the option is exercised. If the employee holds the stock for a required period, any gains on the sale of the stock are capital gains. The exercise price for an ISO must be no less than the fair market value of the underlying stock on the date the ISO is granted.
A&A

Victims of ID Theft Applaud New Way to ‘Freeze’ Credit Reports

Bridget Thomas of Prairieville, Louisiana, lobbied for a way to block access to credit reports in her state after she was badly burned by identity theft that destroyed her credit status.A woman with the same name as Thomas, but a different middle initial, obtained her social security number and started spending.Lawmakers in Louisiana and a few other states, moved by stories like Thomas’, have instituted a privacy option called a security freeze.
Tax

August 16 Deadline Approaches for Extension Filers

Most taxpayers already have filed their tax year 2003 federal income tax returns. But for almost 8.5 million taxpayers who opted for the automatic extension of time to file, the deadline is August 16.The IRS reminds extension filers that e-filing remains available. So far this year, more than 60 million returns have been e-filed.“Why not e-file? More than 60 million Americans already have,” said IRS Commissioner Mark W. Everson. “No matter what time of the year, e-filing is the fastest, safest, easiest way to do taxes.

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