Personal Finance

Tax

Tax Shelter Client List Could be Double What IRS Had Suspected

Settlement papers filed as part of a class-action suit show that the number of clients steered toward illegal tax shelters by Dallas law firm Jenkens & Gilchrist is more like 1,100—nearly double the number previously cited by the Internal Revenue Service, the New York Times reported.
Tax

Sidley Ordered to Give Up Names of Former Tax Shelter Clients

In a matter that raises questions of attorney-client privilege, Chicago law firm Sidley Austin Brown & Wood has been ordered by a federal judge to turn over the names of 46 former tax shelter clients. The 46 clients do not want their names divulged, the Chicago Sun-Times reported.Sidley & Austin, one of the largest and oldest law firms in Chicago, acquired Brown & Wood in 2001.

Corporate Executives Still Reeling in the Perks

America’s highest paid executives collectively made $30.9 million in additional compensation outside of salaries, bonuses and stock awards, according to the proxy statements of Fortune 100 companies.While the perks don’t match the lavish extremes once reported at scandal-ridden Tyco International Ltd.
Community News

Pension Crisis Prompting Changes to Company Retirement Plans

More than half (52 percent) of 125 companies polled are considering changes or already have made changes to their pension plans in the past year, according to a survey by Deloitte Consulting LLP.Buffeted by increased costs due to falling interest rates and investment returns and by continued pressure from financial analysts to limit future risk, more companies are opting to move away from defined benefit plans. Among those respondents that have changed their plans, the single most common shift (among 38 percent) was freezing their pension plan and moving to a defined contribution plan.
Community News

Janus Agrees to Pay $225 Million to Settle Market Timing Probe

Janus Capital Group Inc. has agreed to pay $100 million in fines and restitution and lower its fees by $125 million to settle accusations of abusive mutual fund trading practices that benefited a few favored clients.Janus, the ninth-largest U.S. mutual fund manager, reached the agreement with New York Attorney General Eliot Spitzer and Colorado Attorney General Ken Salazar.
Tax

California Shatters Records With Tax Amnesty Program

California’s recently completed tax amnesty program has yielded more than $1 billion in revenue, nearly 12 times more than the state had originally anticipated, the San Jose Mercury News reported. The unexpected results of the amnesty program also shed the light on just how much money has been hidden in questionable tax shelters.As states grapple with shortfalls and budget crises, experts say that California should be held up as an example of what can be done to raise revenue.
Technology

States Shaming People into Paying Back Taxes

Counting on the fact that people like to know other people’s business, states are capitalizing on the Internet to broadcast the names of scofflaws hoping to shame them into paying their taxes, CBS News reported.At least 13 states are using cleverly named websites such as CyberShame and DelinqNet to list the names of people who owe the states money. "We're trying to shame people," Danny Brazell of the South Carolina Department of Revenue, told CBS. South Carolina credits its website Debtor’s Corner with helping to net $5.5 million in newly collected taxes.
A&A

Federal Government Unveils New $50 Bill

Ulysses S. Grant is getting a face-lift. Grant, who has adorned the $50 bill since 1913, will debut with his new look this week in the latest of the bill redesigns done to ward off counterfeiters.Production of the new $50s will begin this summer at the printing plant in Ft. Worth, TX, where the new look was unveiled this week.
A&A

Show Me the Money: Workers Put a Bonus, Raise First on Wish List

It may not buy happiness, but money is top of mind for employees today, according to a recent survey. Nearly half (48 percent) of workers polled said what they want most at work is a bonus or raise. More time off ranked second, with 24 percent of the response, followed by additional support at the office, with 17 percent. The survey was developed by OfficeTeam, a leading staffing service specializing in highly skilled administrative professionals.
Tax

Treasury and IRS Address Foreign Tax Credit, Partnership Transactions

The Treasury Department and the Internal Revenue Service today issued temporary regulations requiring partnerships to allocate foreign taxes in the same manner as they allocate the income to which those taxes relate. These regulations target certain transactions in which U.S. partners (or U.S. shareholders of partners that are controlled foreign corporations) attempt, through special partnership allocations, to claim foreign tax credits that are not matched by income subject to U.S.
A&A

More Workers Eligible for Overtime Pay Under Rule Change

A new rule defining who must receive overtime pay will cover workers who make up to $100,000 a year, up from the $65,000 overtime ceiling proposed previously.Also, more low-wage workers would automatically become eligible for overtime, and emergency services workers would earn overtime pay if they work more than 40 hours a week.The U.S. Department of Labor on Tuesday issued the long-awaited and far-reaching change to the 1938 Fair Labor Standards Act.
A&A

2004 Retirement Confidence Survey: Percentage of Americans Saving Stagnant Since 2001

What will it take to get more Americans to save and plan for retirement? Despite a recovering economy and efforts to educate the population about the importance of planning and saving for retirement, the percentage of Americans who say they are saving for retirement remains stagnant.
Tax

Treasury and IRS Issue New Pension Interest Rate for Defined Benefit Plans

On Monday, the Treasury Department and the IRS issued a new interest rate for pension plan funding. The new rate implements the Pension Funding Equity Act of 2004, which President Bush signed into law on April 10, 2004.Under prior law, the pension funding interest rate was based on the 30-year Treasury bond. The Pension Funding Equity Act replaces the 30-year Treasury bond rate with a new rate based on high-quality, long-term corporate bonds, as specified by the Secretary.
A&A

Analyst Identifies New Ways to Reduce Risk of ID Theft

Billions of dollars -- that's what identity theft costs U.S. businesses and consumers each year. New research clearly demonstrates that online banking, bill payment and statement viewing is one of the best ways businesses and their customers can protect themselves against identity theft. Yet, consumers still believe incorrectly that online financial transactions increase their risk of fraud.
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.
A&A

Homeowners Could See New Tax Break on PMI

Congress is considering a new tax deduction for homebuyers who could not afford a down payment amounting to 20 percent of the purchase price.Those homeowners have to pay private mortgage insurance, which banks and lenders charge when the down payment is below the 20 percent threshold. The Associated Press reported that under a tax plan before Congress, millions of lower-income homeowners would be able deduct that cost, which is significant in some cases.For example, the owner of a $160,000 house would pay $50 to $80 every month for private mortgage insurance, also known as PMI.
Tax

Treasury, IRS Propose Guidance On Pension Plan Amendments

This week, the Treasury Department and the IRS proposed regulations that would permit employers to make simplifying changes in their retirement plan distribution options while protecting the rights of plan participants. These regulations interpret certain retirement plan provisions that were enacted under the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA). The regulations are based on suggestions received in response to a solicitation of comments published by the IRS in 2002 and 2003.
A&A

AOL Launches 'Bill Pay' Service, AOL Personal Users Take Note

America Online, Inc., (AOL) announced this week the launch of AOL(R) Bill Pay, a new service that helps AOL's community of users save time and money with a streamlined way to track and pay bills online as well as manage their personal finances. AOL Bill Pay is more than just a bill payment service; it is a life management tool, according to AOL releases, that interacts with AOL emails, alerts and calendar. For example, alerts can be set up to notify members of large transactions on their credit cards, which may be an early indicator of identity theft or fraud.
Tax

Eight of Ten Americans Consider Death Tax an Unfair Form of Double Taxation

The vast majority of Americans believe the estate tax, also known as the Death Tax, should be permanently repealed, according to a new survey released this week by the American International Automobile Dealers Association (AIADA).
Tax

Tax Time Practices Jeopardizing Americans' Financial Plans, Survey Says

Americans aren't properly prepared for tax season according to a new survey from MDRT (Million Dollar Round Table), the premier association of financial professionals. This lack of preparedness could cost Americans much needed extra funds and could jeopardize their overall financial plans.The survey of 1,000 Americans found that 44 percent of people who owe taxes would pay them by tapping credit cards, loans, and even personal savings. This may be due to the fact that only six percent of Americans who owe money actually budgeted specifically for this purpose.

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