Republicans unload on the IRS
A band of eleven leading Republican lawmakers, including House Speaker John Boehner (OH) and Senate Minority Leader Mitch McConnell (KY), are urging new IRS Commissioner John Koskinen to withdraw new proposed rules governing tax-exempt groups, casting the regulations as a political power play meant to silence conservatives, Bernie Becker of The Hill reported.
The regulations, which the IRS released last November as a response to the agency’s targeting of conservative groups, were slammed by Republicans, saying they would merely codify the targeting of Tea Party groups that sought tax-exempt 501(c)(4) status, according to Becker.
In a letter sent on Thursday to Koskinen, who had no role in crafting the proposed regulations, the GOP lawmakers called the rules “an affront to free speech.”
“The timing of this rule appears calculated to take effect just in time for the mid-term elections, giving the strong appearance of political motivation,” the letter stated, according to the article.
Get ready for a ‘weird’ jobs report
Economists surveyed by CNNMoney.com are predicting 178,000 jobs were created in January, a big improvement from December’s measly 74,000 jobs, Annalyn Kurtz reported on February 6.
The US Department of Labor’s job report for last month will be released today. Snowstorms, big annual revisions, and the end of benefits for the long-term unemployed could give a distorted picture of the job market, economists say.
Kurtz wrote that after digging deeper into the details, a few anomalies appeared that economists believe will be revised in the future. What is one such anomaly, you say? How about accounting firms cutting 25,000 jobs. But you might want to take that figure with a grain of salt.
“That’s pretty bizarre,” Mark Zandi, chief economist for Moody’s Analytics, told Kurtz. “There’s no reason to think that actually happened in the month.”
UPDATE: Only 113,000 jobs were added in January, according to the Labor Department. Click here for CNNMoney's updated article.
Senate backs Max Baucus for China ambassador
Ninety-six to zero. That was the vote on the Senate floor on Thursday confirming Senator Max Baucus (D-MT) as the next US ambassador to China, Doug Palmer of Politico reported.
“Baucus’s move overseas creates a vacancy on the highly sought-after Finance Committee, allowing Ron Wyden of Oregon to assume the chairmanship of the powerful panel,” the article stated. “Wyden, in turn, would give up his current slot as chairman of the Energy Committee, which would most likely go to Mary Landrieu, a move thought to bolster the vulnerable incumbent’s reelection prospects in Louisiana this year.”
During his farewell statement to the Senate, Baucus said he believes the United States-China relationship is one of the most important bilateral relationships in the world.
“It will shape global affairs for generations. We must get it right,” he said.
Individual income taxes may soon generate half of all federal tax revenue
Forbes contributor Howard Gleckman wrote on February 6: “Over the next decade, the individual income tax will be the fastest growing source of federal revenue, according to new estimates by the Congressional Budget Office [CBO]. In fact, the individual income tax will pretty much be the only revenue source likely to increase significantly over the next decade. As a result, it will generate more than half of all federal revenue for the first time since the turn of the 21st century.”
But, according to Gleckman, the really interesting story is in the composition of revenues.
“Nearly all the projected increase in taxes will come from the individual income tax: CBO projects the levy will rise from 8.0 percent of GDP [gross domestic product] this year to 9.4 percent by 2024,” he noted.
“As a result, CBO figures that a decade from now, the individual income tax will account for nearly 52 percent of all federal revenue,” Gleckman continued. “The last (and only) time the individual tax generated half of all federal revenues was in 2001, just before the dot.com bubble burst and Congress passed the first of the huge George W. Bush-era tax cuts.”
Cash method of accounting on verge of extinction
CPA Paul Neiffer, a partner with CliftonLarsonAllen in Yakima, Washington, and a regular contributor to Agweb.com, said the cash method of accounting likely is nearing an end for top producers, making way for the accrual method, Nate Birt of the Farm Journal wrote.
“I think if Congress is serious and the president is serious about getting the top corporate tax rate – and supposedly we have the highest corporate rate in the whole world – if they’re serious about getting the top rate down to 28 percent or possibly 25 percent, farmers will lose the cash method of accounting,” Neiffer said during the 2014 Top Producer Seminar, according to the article. “I don’t think there’s any other way that they can raise enough revenues along with other provisions. So if the farmers don’t want that to happen, they going to need to talk with their congressman, talk with their senator.”
Seven ways for small businesses to rein in health care costs
Journal of Accountancy Senior Editor Ken Tysiac wrote about seven strategies small businesses can use to reduce health care costs. Experts who participated in a recent American Institute of CPAs (AICPA) webcast devoted to health care reform said strategies should be evaluated for their impact on employee morale, engagement, productivity, retention, recruiting, and even reputational risk.
Eight growth strategies for your firm in 2014
Ron Carson, founder and CEO of Carson Wealth Management Group, wrote an article for Financial Planning on the eight trends he saw among successful firms last year that financial advisors looking to grow should implement in 2014.
“Yes, measuring success is about increasing revenue, gaining new assets, and achieving a work-life balance. But, it’s also about taking your past experiences and moving forward in a smarter way,” he noted.
Ernst & Young donates $1.1 million to UW-Madison School of Business
The Big Four firm will give $850,000 to the University of Wisconsin-Madison Global Mindset Leaders Program, which teaches students about cultural and social diversity in business, and the remaining money will pay for programs in the School of Business' accounting department, according to an article in the Milwaukee Business Journal.