Corporate AMT proposed regulations issued; some penalties waived

The IRS on Thursday issued proposed regulations (REG-112129-23) addressing the application of the Sec. 55 corporate alternative minimum tax (AMT) as amended by the Inflation Reduction Act of 2022, P.L. 117-169. The Service also issued a notice further delaying the application of the penalty for failure to pay estimated tax with respect to the corporate AMT. The proposed regulations provide guidance on determining if a corporation is subject to the corporate AMT...Read More

Employers now have interim guidance on student loans and retirement plans

The IRS provided interim guidance to employers that provide matching retirement plan contributions based on student loan payments, a new benefit courtesy of a 2022 law. Notice 2024-63, which the IRS posted Monday, implements Section 110 of the SECURE 2.0 Act of 2022 (Division T of the Consolidated Appropriations Act, 2023, P.L. 117-328). It applies to sponsors of 401(k) and similar retirement plans that...Read More

Tax Practitioner’s Complaint Triggers Investigation into Advocate Phone Service

A tax practitioner, frustrated by a six-week wait for a Taxpayer Advocate Service (TAS) response about a tax refund, complained to a federal watchdog. That complaint, related to a client facing financial hardship, led to a review that found the phone service provided by TAS offices across the nation was slow and inconsistent. Only two offices answered the call, TIGTA's report said. Fifty-six calls...Read More

Decrease in Financial Restatements Signals Improved Reporting Quality

A study conducted by the Center for Audit Quality (CAQ) found that the number of financial restatements filed with the SEC fell by more than 50% over a recent 10-year period. The number of financial restatements, defined for the purposes of the study as "corrections of errors in public company financial statements filed with the [SEC]," have been on the decline for 16 years...Read More

CPA Exam’s top scorers earn Elijah Watt Sells Award

Forty CPA candidates received the 2023 Elijah Watt Sells Award, established more than 100 years ago by the AICPA to recognize outstanding performance on the CPA Exam. The award is given to CPA candidates who obtain a cumulative average score above 95.50 across all four sections of the Uniform CPA Examination, pass all four sections on their first attempt, and complete testing in 2023...Read More

Financial Planning Considerations for Childfree Clients

Traditional financial planning strategies assume that clients loosely follow a life path that starts with accumulation during years that include marriage, homebuying, child-rearing, and career and/or business growth, followed by decumulation through retirement and/or succession, estate, and legacy planning. However, this general formula, which is heavily focused on helping clients pass along the maximum amount of wealth to next generations..Read More

IRS Strategic Operating Plan Includes Enhancements to Practitioner Services

Although the IRS says it has made great strides in customer service to taxpayers over the past year, "We have a lot more work to do," Commissioner Danny Werfel said Thursday. That work includes improving interactions with tax professionals, a point Werfel highlighted as he outlined the IRS's updated strategic operating plan (SOP). For example, 85% of calls to the IRS go to the toll-free...Read More

AICPA Advocacy: Supporting Small Registered Investment Advisers

The AICPA has submitted a comment letter to Treasury's Financial Crimes Enforcement Network (FinCEN) expressing concern over the potential impact of recently proposed regulations on small registered investment advisers (RIAs). The letter is in response to a FinCEN notice of proposed rulemaking, titled Anti-Money Laundering/Countering the Financing of Terrorism Program and Suspicious Activity...Read More

Supreme Court Set to Rule on Estate Tax Ramifications of Life Insurance in Closely Held Businesses

The U.S. Supreme Court will decide a case this term that presents a crucial question regarding the estate tax treatment of life insurance proceeds received by a closely held business and its shareholder redemption obligations. It focuses on closely held corporations' practice of entering into an agreement to redeem the stock...Read More

Financial Services Companies Adapt to Meet Employee Demands in Evolving Work Environments

Among financial services companies that have adopted a structured hybrid model, the vast majority do so by designating a minimum number of days per week that employees must work in office, with more than half of those companies mandating at least three days (52% three days, 5% four days). The average requirement for in-office days per week checked in at 2.58 days...Read More

Executive leaders are just like everyone else — aiming to stay current with today's ever-changing workplace. Keeping up with new technology is the top personal challenge for C-suite executives, followed closely by balancing career and personal life, and embracing change and innovation, according to a new survey.....Read More

Balancing Act: Leveraging Responsible Data Protection for Enhanced Privacy and Profits

When it comes to data protection priorities, however, customers and companies aren't necessarily on the same page, a divide that creates an opportunity for businesses to delight their customers. In the "consumer view" portion of the survey, 61% of respondents cited two overlapping actions that would help build and maintain...Read More

How tax practice standards affect CPAs

As business and regulatory environments have become more complex, many CPAs have focused their practices heavily or solely on one area, such as business consulting, financial and managerial accounting, tax matters, or information technology and analytics. As professional standards in these discrete areas (e.g., reporting standards, tax rules, etc.) become more complex, however, practitioners who focus primarily on one type of service (e.g., accounting services) might not perceive the risks inherent in providing limited services.....Read More

Tips for a better tax season

As CPA tax professionals gear up to prepare clients’ 2023 tax returns, they will have to address recent changes in tax laws and rules, as they do every year. In addition to technical issues, to best prepare for the upcoming tax season’s pressures and deadlines, practitioners should assess the management of their tax practices to identify areas for potential improvement......Read More

US Supreme Court will hear repatriation tax challenge

The U.S. Supreme Court granted a married couple’s petition for certiorari challenging the constitutionality of the Sec. 965 repatriation tax (also known as the “transition tax”) enacted in 2017 by the law known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97. The petition appeals a 2022 decision by the Ninth Circuit in the government’s favor. The case is slated to be heard during the Court’s 2023–2024 term. A summary of the Ninth Circuit’s opinion follows.....Read More

OPR publishes letter to request tax information in case files

The IRS Office of Professional Responsibility (OPR), which is responsible for discipline imposed on CPAs and other individuals who practice before the IRS, has created a standard letter for requesting tax information in OPR case files that was obtained as part of an inquiry into Circular 230 violations.....Read More

To combat fraud, IRS steps up ERC claim enforcement

The IRS and Treasury are looking at new ways to fight rampant fraud in employee retention credit (ERC) claims, including possible congressional action to move up the claim filing deadline and stricter oversight of tax preparers, IRS Commissioner Danny Werfel said Tuesday at a special roundtable session of tax professionals in Atlanta...... Read More

Penalty for underpayment of estimated corporate AMT waived for 2023

The IRS on Wednesday issued Notice 2023-42, which grants penalty relief for corporations that did not pay estimated tax in connection with the new corporate alternative minimum tax (CAMT), saying the move is "in the interest of sound tax administration." In the notice, the IRS is waiving the Sec. 6655 estimated tax penalty with respect to a corporation's Sec. 55 corporate AMT liability for tax......Read More

Penalty for underpayment of estimated corporate AMT waived for 2023

The IRS on Wednesday issued Notice 2023-42, which grants penalty relief for corporations that did not pay estimated tax in connection with the new corporate alternative minimum tax (CAMT), saying the move is "in the interest of sound tax administration." In the notice, the IRS is waiving the Sec. 6655 estimated tax penalty with respect to a corporation's Sec. 55 corporate AMT liability for tax years beginning after Dec. 31, 2022, and before Jan. 1, 2024. .........Read More

Proposed regs. provide rules for repatriation of intangible property

The IRS on Tuesday issued proposed regulations that would in certain cases terminate the continued application of Sec. 367(d) when intangible property is repatriated to certain U.S. persons after being previously transferred to a foreign corporation. Sec. 367(d) provides rules for outbound transfers of intangible property by a U.S. person to a foreign corporation. Specifically, the U.S.......Read More

Watch for these red flags when choosing a tax preparer

The IRS reached the halfway point of its annual "Dirty Dozen" list of tax scams on Monday, when it advised that taxpayers be careful when choosing a preparer to handle their returns. A major red flag that the preparer is not a CPA or another type of professional tax preparer is if the preparer refuses to sign the return or include their IRS preparer tax identification number......Read More

NRI Businessman Goljar Singh asked to pay back Rs 5.9 cr in unpaid tax

44-year-old NRI businessman Goljar Singh has been asked to pay back 600,000 pounds (Rs 5.9 crore) in unpaid tax after a raid at his home and seizure of 1 million pounds from his bank accounts.In one of Scotland’s largest ever tax settlement cases, Goljar Singh of East Lothian was tracked by police after several of his bank accounts were detected as having received large cash deposits.....Read More

Business standard mileage rate increases for 2023

The IRS increased the optional standard mileage rate used to calculate the deductible costs of operating a vehicle for business to 65.5 cents per mile driven, up 3 cents from a rare midyear increase in 2022. The notice sets the 2023 standard mileage rates at 22 cents per mile driven for medical or moving purposes for qualified active-duty members of the armed forces This is the same as the higher midyear rate for the second half of 2022........Read More

Final regs. issued on centralized partnership audit regime

The IRS issued final regulations that provide an exception from the centralized partnership audit regime for certain partnership-related items. The partnership items to which the exception applies are those that involve a "special enforcement matter" as defined in the regulations. The regulations also provide alternative rules for examinations of those excepted items and address imputed underpayments that result from centralized audit regime adjustments.......Read More

One deadline approaches for over 9 million eligible for pandemic-era benefits

Over 9 million individuals and families who may not typically file a tax return — likely because of their low income — were mailed letters from the IRS reminding them of their probable eligibility for several pandemic-era tax credits. Now, one filing deadline is approaching this week. In an effort to reach the 9 million individuals and families who had not filed a 2021 return.......Read More

Final regulations adopt ‘family-friendly’ health care affordability test

The IRS on Tuesday issued final regulations adopting an affordability test for employer-sponsored minimum essential coverage for purposes of the Sec. 36B premium tax credit that takes into consideration the cost of covering an employee's family members in addition to that of the employee.......Read More

AICPA asks IRS to expand penalty relief

While the AICPA said it welcomes the IRS's recent grant of automatic penalty relief for failure to file a broad range of tax and information returns for 2019 and 2020, it requested that the IRS expand, modify, and clarify the scope of that relief, as well as extend the relief deadline from Sept. 30 to Dec. 31.......Read More

AICPA disputes ‘misleading’ claims on new IRS funding, calls for service improvements

Reaction to increased funding for IRS operations in the Inflation Reduction Act, P.L. 117-169, enacted Aug. 16, has featured "heated rhetoric," but the act has also prompted real concerns regarding how the funding will be used and what that means for the tax profession and taxpayers, said AICPA President and CEO Barry Melancon....Read More

Senate passes CHIPS Act with semiconductor tax credit

The U.S. Senate on Wednesday passed a bill to encourage greater domestic production of microchips and other semiconductor materials and devices, in part through a new investment tax credit. The Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Act of 2022 (Senate Substitute Amendment 5135 to H.R......Read More

How purpose can play a bigger role in business`

Harvard Business School professor and author Ranjay Gulati says that sentiment is growing among business leaders that companies have a larger role to play than simply providing shareholder value.This episode is a rebroadcast of Gulati's appearance on the FM podcast to discuss that topic and others highlighted in his recent book, Deep Purpose: The Heart and Soul of High-Performance Companies.......Read More

Certain tax services do not violate US ban on provision of accounting services in relation to Russia sanctions

U.S. accounting firm is not prohibited by a White House executive order regarding U.S. sanctions against Russia from providing tax advisory and preparation services to the U.S. subsidiary of a Russian company in certain scenarios, according to guidance issued Thursday by Treasury's Office of Foreign Assets Control (OFAC).......Read More

No step-up in basis for private foundation’s assets

Heirs can generally benefit from a step-up in basis of inherited assets to their fair market value (FMV) as of the date of the decedent's death. A recent program manager technical advice (PMTA) makes clear that, for purposes of an excise tax, a private foundation resulting from a charitable organization's ceasing to qualify as a public charity cannot claim a step-up upon the conversion......Read More

Individual taxpayers must answer cryptoasset question, IRS notes

The IRS highlighted in a news release that all filers of Forms 1040, U.S. Individual Income Tax Return, 1040-SR, U.S. Tax Return for Seniors, and 1040-NR, U.S. Nonresident Alien Income Tax Return, must answer the forms' question regarding virtual currency. The question, which on Form 1040 is just below the address block, asks, "At any time during 2021, did you receive, sell, exchange, or otherwise dispose of any financial interest in any virtual currency?"......Read More

Proposed regulations update RMDs for SECURE Act changes

The IRS and Treasury released proposed regulations Wednesday (REG-105954-20) that would update existing rules for required minimum distributions (RMDs) from qualified retirement plans and annuity contracts and related matters, largely to conform with a number of statutory changes........Read More

Lenders should not report student loans discharged under ARPA

Lenders and servicers of most student loans should not file Form 1099-C, Cancellation of Debt, for loans discharged in 2021 through 2025, since borrowers do not have to include these forgiven amounts as income for tax purposes, the IRS stated Tuesday........Read More

Early sunset of the employee retention credit gets penalty relief

Employers that received an advance payment of the employee retention credit (ERC) or reduced their employment tax deposits in anticipation of receiving the ERC for the fourth calendar quarter of 2021 may repay or deposit the taxes without penalty under guidance issued Monday by the IRS.........Read More

Meal portion of per diem allowance can be treated as attributed to a restaurant

The 100% deduction allowable as a business expense in 2021 and 2022 for food or beverages provided by a restaurant applies to the meal portion of a per diem rate or allowance, the IRS clarified Tuesday in Notice. Under Sec. 274(n)(1) and Regs. Sec. 1.274-12, a deduction of any expense for food or beverages generally is limited to 50% of the amount otherwise deductible.....Read More

Final regulations establish a user fee for estate tax closing letters

An estate tax closing letter informs its authorized recipient of the IRS's acceptance of the estate tax return (generally, Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return) and provides some return information, such as the amounts of the net estate tax, any state death tax credit or deduction, and any generation-skipping transfer tax for which the estate is liable.......Read More

Why single-audit demand is rising; an update on tax preparer legislation

The number of organizations needing single audits has risen dramatically in the past year. Why? Deetra Watson, CPA, CGMA, an accounting firm principal, explains some of the intricacies of single audits and why demand is increasing for such specialized services. Also, Ed Karl, CPA, CGMA, the AICPA’s vice president–Tax Policy & Advocacy,...Read More

With Florida law, almost all states require online sales tax collection

Under the bill, remote sellers and marketplace facilitators will be required to collect Florida sales taxes on sales to purchasers in Florida if the seller or facilitator makes a substantial number of sales into the state. “Substantial” is defined as conducting any number of taxable remote sales into Florida exceeding $100,000 during the previous calendar year. ....Read More

Deadline for certain single audits delayed because of pandemic

The due date for certain single audits to be submitted to the Federal Audit Clearinghouse has been delayed six months as a result of challenges related to the coronavirus pandemic. The Office of Management and Budget (OMB) announced the extension in a memorandum for the heads of executive departments and agencies issued this week.......Read More

AICPA urges delay in tax deadline until June 15

The American Institute of CPAs is asking the Treasury Department and the Internal Revenue Service to push back the tax filing and payment deadline for two months. The AICPA sent a letter Thursday to officials at the Treasury and the IRS asking for an extension until June 15, pointing to the challenges created by the COVID-19 pandemic and the existing backlog at the IRS on tax returns filed last year........Read More

New PPP changes attempt to ease smallest businesses' access

The administration of President Joe Biden announced Monday that it would institute a two-week period starting Wednesday during which only businesses with fewer than 20 employees will be able to apply for Paycheck Protection Program (PPP) loans......Read More

Maryland’s Tom Hood joins the Association of International Certified Professional Accountants

Tom Hood, the longtime CEO of the Maryland Association of CPAs, has joined the leadership team of the Association of International Certified Professional Accountants (the Association). As executive vice president of business growth and engagement, Hood will report to Barry Melancon, CPA, CGMA, the Association’s CEO.....Read More

Partner capital account reporting gets transition penalty relief

The IRS provided transition penalty relief Tuesday to partnerships in complying with new rules for reporting partners’ capital account balances.

The relief in Notice 2021-13 follows up on Notice 2020-43, issued in June 2020, in which the IRS sought public comments to help inform its development of the r­ules......Read More

Some teleworkers could be hit with surprise tax bills

CPAs may find themselves spending a lot of time educating taxpayers about the state tax implications of working from home and other locations during the pandemic. A new survey conducted for the AICPA by The Harris Poll found that 55% of respondents who worked remotely this year aren’t aware of the potential tax consequences of not ....Read More

Taxpayers allowed choice of bonus depreciation rules

When the IRS issued final bonus depreciation regulations in September (T.D. 9916), it said it planned to issue procedures allowing taxpayers to choose to apply the final regulations in prior tax years or to rely on the proposed regulations issued in September 2019......Read More

Leading in times of crisis

The tumult of 2020 has amplified many issues that the accounting profession was already contending with, including future-readiness, diversity and inclusion, and technological investment.....Read More

How the CARES Act has affected business valuation

The coronavirus pandemic and the legi

slation designed to help employers during the crisis have added new challenges for professionals who perform business valuations. To help CPAs and other valuation experts meet those challenges, the AICPA on Tuesday issued a set of FAQs on how to adjust business valuations based on the Coronavirus Aid, Relief,.....Read More