Bramwell’s Lunch Beat: How Aerial Photography is Helping Local Tax Assessorsby
Societe Generale unit joins other Swiss banks in US tax evasion pact
A unit of Societe Generale SA based in Switzerland and three other banks agreed to pay a total of $2.2 million in penalties for helping American clients avoid taxes, wrote Joel Rosenblatt of Bloomberg. The settlement comes under a US program that lets Swiss banks avoid prosecution if they agree to cooperate with prosecutors and disclose their tax-avoidance methods. Other banks are negotiating similar accords. MediBank AG, LBBW AG, and Scobag Privatbank AG will pay a total of almost $1 million in penalties, the US Justice Department said last week. Societe Generale Private Banking, based in Lugano, will pay $1.36 million. Societe Generale Private Banking helped US customers conceal assets and income from the IRS, according to the Justice Department.
That Cessna flying over your house may be sending photos to the tax assessor
Suzanne Woolley of Bloomberg wrote that some local tax assessors have found an easy way to check properties in wealthy neighborhoods that are shielded by tall, thick hedgerows and long, gated driveways. They are using aerial photography, with cameras in the plane’s belly and sides taking high-resolution photos of lawns speckled with pools, cabanas, and tennis courts. Local tax authorities say the photos can lead to more accurate tax rolls, greater tax revenue, and a far faster, easier way to assess properties. For an extra fee, counties can use software to compare current photos with prior flyovers. That helps them find potential changes to properties – and a good recent aerial photo can also stop a property tax appeal in its tracks. In addition to being shot straight down, the photos are taken at an angle, from all four directions. That makes changes to a property far easier to see and measure, and with every pixel in the photo geo-referenced, land parcels are easy to identify.
House committee chairman subpoenas IRS official for hearing
House Oversight and Government Reform Committee Chairman Jason Chaffetz (R-UT) issued a subpoena on May 29 for an IRS official to testify at a hearing on the Freedom of Information Act, wrote Stephen Ohlemacher of the Associated Press. Chaffetz said he issued the subpoena after the IRS declined to provide the official who oversees information requests. Instead, the IRS offered to have IRS Commissioner John Koskinen testify. In a letter to Koskinen, Chaffetz said he wanted to hear from the agency's expert on responding to information requests. Chaffetz issued the subpoena for Mary Howard, the IRS director of privacy, governmental liaison, and disclosure. She reports to a deputy commissioner. The IRS said last Friday it will send Howard to the hearing, which is scheduled for June 3. Officials from several government agencies are scheduled to testify.
Executives too busy to take vacations
Work is getting in the way of much-needed vacations, according to the latest executive survey by recruitment and HR consulting firm Korn Ferry, wrote Katie Kuehner-Hebert of CFO. Sixty-seven percent of the more than 400 US executives surveyed online earlier this month said they had postponed or canceled vacation plans in the past year due to demands at work. While 83 percent said they planned to take at least some days off this year, 57 percent did not expect to use all of their available vacation days. Nearly three-fourths (72 percent) cited “too much work to do” and an “increased workload upon return” as the primary reason why they did not take a vacation. For those who did take some days off, half still connected with work multiple times a day, and 29 percent connected at least once a day.
Kansas debates sales-tax increase
Republican Gov. Sam Brownback has proposed raising Kansas’ sales tax in the face of a $400 million budget deficit resulting from plunging state revenues, wrote Mark Peters and Douglas Belkin of the Wall Street Journal. The offer, made on May 30, comes three years after Brownback won legislative backing for a cut in the state’s top income tax rates by a quarter and the elimination of taxes on non-wage business income. The governor proposed raising the state sales tax to 6.65 percent from 6.15 percent and eliminating most income tax deductions. The proposal also called for increasing cigarette taxes by 50 cents per pack and imposing income taxes on some previously exempted small business revenues. The plan also would exempt 388,000 low-income Kansans from income tax.
IRS technical guidance roundup (week of May 25)
The IRS issued the following technical guidance last week:
Notice 2015-40 requests comments regarding the effect of the new revenue recognition standards on taxpayers’ methods of tax accounting. Comments are due on or before Sept. 16. (In 2014, the Financial Accounting Standards Board and the International Accounting Standards Board announced new financial accounting standards for recognizing revenue.)
Notice 2015-41 provides guidance to regulated investment companies (RICs) and their shareholders under §§ 1(h) and 852(b) of the Internal Revenue Code concerning capital gain dividends of RICs. The notice updates prior guidance to take into account changes made to § 852 by the Regulated Investment Company Modernization Act of 2010, Pub. L. No. 111–325, 124 Stat. 3537, and to address other aspects of the computation and treatment of capital gain dividends of RICs.
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