Previous month:
February 2010
Next month:
April 2010

March 2010

IRS UPDATES FAQS ON REQUIRING REGISTRATION FOR RETURN PREPARERS

To help alleviate growing confusion, the IRS recently updated its online frequently asked questions page about a mandate to require return preparers to register with the IRS, and for preparers who aren’t enrolled, to pass a test and take annual continuing professional education (CPE) courses.

To review a list of the FAQs and responses, go to http://www.irs.gov/taxpros/article/0,,id=218611,00.html


TSCPA ASKS IRS TO EXTEND COMMENTS PERIOD FOR PROPOSED PTIN REGS

The Texas Society of CPAs’ Federal Tax Policy Committee on March 30 sent a letter asking IRS Commissioner Shulman and Chief Counsel Wilkins, to extend the comments period for the proposed regulations under IRC section 6109, Furnishing Identifying Number of Tax Return Preparer (“PTINs”). The proposed regulations were issued March 26 with a comments deadline of April 26.

 

Click here to read the letter.

 


IRS COMMISSIONER SHULMAN ADDRESSES STATE OF THE ORGANIZATION; ISSUES FOR THE FUTURE

Doug Shulman, commissioner of the IRS, recently sat down with the Journal of Accountancy to offer his views on the current state of the IRS, how it’s adapting to today’s economic conditions, while accomplishing the traditional role of the organization, and how CPAs and other accounting professionals play a significant role in the group’s success.

 

To read the interview in its entirety, click here

 http://www.journalofaccountancy.com/Issues/2010/Apr/20102509.htm

 

 


IRS ISSUES REGULATIONS THAT REQUIRE USE OF PERSONAL IDENTIFICATION NUMBERS ON TAX RETURNS

The IRS on Wednesday, March 24, 2010, proposed regulations requiring all paid tax preparers to obtain and use a tax identification number (PTIN) for all tax returns after December 31, 2010.

 

This regulation is the first one issued by the IRS under its proposed plan to require PTIN registration by all paid return preparers. Current regulations allow preparers to use either their Social Security number or a PTIN. The new proposal would no longer accept the use of Social Security numbers; only a PTIN on all tax returns and refund claims.

 

The proposed regulations provide a transition rule for returns due for tax periods that end before Jan. 1, 2011. On those returns, preparers should use the identifying number prescribed on the form being filed.

Under the proposed regulations, failure to include a PTIN on a return could subject a return preparer to penalties under IRC § 6695(c). That penalty is $50 for each failure to furnish a required identification number, up to $25,000 in each calendar year.

For more details regarding this regulation, go to http://www.journalofaccountancy.com/Web/20102735.htm


HOUSE APPROVES BILL REQUIRING IRS TO USE 'PLAIN WRITING,' EXCEPT IN REGULATIONS

The House, last week, (March 17) voted 386-33 to approve H.R. 946, the Plain Writing Act of 2010, which requires the IRS and other government agencies to write public documents in "plain writing," defined as "writing that the intended audience can readily understand and use because that writing is clear, concise, well-organized, and follows other best practices of plain writing." 

 

The bill covers all documents issued by a federal agency to the public (whether in print or electronic form). Federal agencies would be required to comply with the rule within one year. But the rule does not apply to regulations.

 

To read more from Rep. Bruce Braley's (D-Iowa) Web Site regarding this legislation, click here http://ow.ly/1oF3f

 

 

TSCPA SEEKS LAWMAKER SUPPORT OF INVESTOR PROTECTIONS IN SOX SECTION 404(B)

The Texas Society of CPAs joined advocacy efforts with other states and AICPA this week to express the profession’s position on Capitol Hill that all public companies, regardless of size, should be subject to the internal controls audit requirement. TSCPA issued a letter Monday, March 22, 2010, to Senator Kay Bailey Hutchison (R-Texas) on the Banking Committee that we support investor protections in Sarbanes-Oxley section 404(b) and oppose any attempt to amend it during debate on the Restoring American Financial Stability Act.

 

This financial regulation overhaul bill cleared the Banking Committee last night (March 22) on a party-line vote without opposition. It now moves to the Senate floor where amendments will be hashed out. Texas CPAs will have a great opportunity to reach out to Senators Hutchison and John Cornyn (R-Texas) in support of this issue during Congress’s spring recess March 26 through April 12.

 

TSCPA letter to Senator Hutchison

http://www.tscpa.org/Content/Files/pdf/Govt%20Affairs/2010/TSCPA%20Ltr%20to%20Senator%20Hutchison%20SOX%20Sec%20404b%203-22-10.pdf


NEWLY APPROVED HEALTH CARE ACT CONTAINS NUMEROUS TAX PROVISIONS

The hotly-contested Health Care Act that has seemingly divided the country along party lines and provided debate fodder for weeks to come includes a plethora of tax conditions.  A few of the more ubiquitous provisions include the following:

Small Business Tax Credit – Offers tax credits to small businesses and individuals designed to increase levels of health insurance coverage, as part of the general business credit.

Excise Tax on Uninsured Individuals – Requires U.S. citizens and legal residents to maintain minimum amounts of health insurance. Individuals who fail to have essential coverage will be subjected to a penalty of $750. The fee for an insured person under the age of 18 is one-half of the adult fee ($375). The total household penalty may not exceed 300 percent of the per-adult penalty ($2,250).

Tax-Exempt Health Insurance – Provides a program by the Department of Health and Human Services that will advance the creation of qualified nonprofit health insurance providers to offer health insurance. Those receiving grants or loans under the program would be exempt from federal tax for times when insurer complies with the program terms.

Fees on Health Plans – A fee is imposed on each specified health insurance policy. The fee is equal to two dollars (one dollar for policy years ending in the fiscal year 2013) multiplied by the average number of lives covered under the policy.

For a comprehensive analysis of the provisions, click here http://www.journalofaccountancy.com/Web/20102724.htm


TSCPA COMMITTEE ISSUES REQUEST TO IRS ON IRC SEC 67(E)

In a letter issued on March 19, 2010, the TSCPA Federal Tax Policy Committee has asked IRS Commissioner Douglas Shulman and Chief Counsel William Wilkins for prompt interim guidance under IRC section 67(e). Proposed regulations under IRC section 67(e) allow a full deduction for estate and trust administrative costs, only if such costs are unique and “an individual could not have incurred” that cost in connection with property not held in an estate or trust. Notices 2008-32 and 2008-116 do not apply to 2009 and 2010 tax years. The committee also supports AICPA’s position that guidance should not require trustee fees to be unbundled.

 

Click here to review the letter:

http://www.tscpa.org/Content/Files/pdf/Resource%20Center/Tax%20Issues%20Community/Letters/TSCPAFedTaxPolicyIRSSec67e.pdf

 

 


Obama Signs U.S. Travel Promotion Act

President Obama, last week, signed into law, the U.S. Travel Promotion Act which creates a tourist marketing program to attract international visitors to the United States.

 

Considered a tax-free stimulus, the program is funded through a combination of private sector contributions and a $10 fee on foreign travelers who do not pay $131 for a visa to enter the United States. Current estimates forecast the Travel Promotion Act will generate $321 million a year in new tax revenue, and reduce the federal deficit by $425 million.

 

For more details about this new legislation, click here

http://www.commerce.gov/NewsRoom/PressReleases_FactSheets/PROD01_008969


Senate Working on House Bill that Extends Numerous Expired Tax Breaks

The Senate, as of Monday (March 8, 2010), is trying to pass its own version of H.R. 4213 tax extender bill without an estate tax provision.

 

Spearheaded by Senate Majority Leader Harry Reid (D-Nev.) and Senate Finance Committee Chairman Max Baucus (D-Mont.), the extender will offer a substitute amendment that adds several spending measures to the bill, including an extension for highway spending. Debate is expected to last through most of this week.

Republicans agreed to move on extender legislation without an agreement on how to handle the estate tax. Senate Minority Whip Jon Kyl (R-Ariz.) made reaching an agreement on the tax a caveat to allowing a vote on extenders. 

The longer the fate of the estate tax remains unknown, the more it becomes a political liability for lawmakers.

 

To read more about this legislation, click here.

http://thehill.com/blogs/blog-briefing-room/news/84185-gop-allows-extender-bill-to-move-forward-