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May 2010

Federal Tax Policy Committee Issues Letter to IRS Regarding Uncertain Tax Positions

The TSCPA Federal Tax Policy Committee, today (May 27, 2010) issued a comments letter to IRS Commissioner Doug Shulman concerning Announcement 2010-9, Uncertain Tax Positions – Policy of Restraints (and related Announcements and Instructions).

 

The Federal Tax Policy Committee details concerns in a six-page letter including that the burden on businesses to comply with the new reporting requirements would be disproportionate to the potential benefit.

 

Download FTP letter to IRS Announcement 2010-9 UTP


New Health Care Bill Has Radical Tax Change Hidden Within

Unbeknownst to most, Section 9006 of President Obama’s new health care bill requires that in 2012 all companies will have to issue 1099 tax forms for not only contract workers but any person or corporation that purchases more than $600 in goods in a tax year.

This hidden caveat radically changes the nature of 1099s and means businesses will need to issue millions of new tax documents each year to meet the requirement.

The IRS estimates that the federal government loses more than $300 billion each year in tax revenue on unreported income. Proponents of this plan believe filing new 1099s to claim millions of dollars in untracked transactions is one way to begin to close the gap.

However, critics believe this will create a logistical nightmare for keeping track of the “paper work” needed to comply with the provision.

The new requirements take effect January 1, 2012. 

For more details

http://money.cnn.com/2010/05/05/smallbusiness/1099_health_care_tax_change/index.htm


Senator Cornyn Addresses Current Financial Regulatory Reform Debate

In an op-ed piece in today’s (May 7) Dallas Morning News, Senator John Cornyn (R-Texas) states that Texans want to end the current cycle of corporate bailouts and not punish those who have borrowed and lent responsibly.

 

Cornyn is against the proposed Senate bill and believes it would allow for more power in Washington by creating a new bureaucracy (i.e.) the Consumer Financial Protection Bureau. Cornyn instead wants to strengthen the Federal Bankruptcy Code.

 

To read Cornyn’s editorial, go to http://www.dallasnews.com/sharedcontent/dws/dn/opinion/viewpoints/stories/DN-cornyn_07edi.State.Edition1.91c3ad.html


IRS Announces Release of Draft Schedule to Report Uncertain Tax Positions

The IRS on April 19, announced issuance of a draft schedule (Announcement 2010-30) http://www.irs.gov/pub/irs-drop/a-10-30.pdf that requires certain taxpayers to report uncertain tax positions on their tax returns.

 

According to the announcement, taxpayers with uncertain tax positions and assets of $10 million or more will be required to file Schedule UTP beginning with the 2010 tax year if they, or a related entity, filed audited financial statements.

 

The IRS has requested comments on the draft schedule and instruction, as well as proposal in Announcement 2010-9 to require reporting of uncertain tax positions on the tax return, by June 1. To submit your comments, click on the Comments button below, or e-mail Patty Wyatt at pwyatt@tscpa.net