Tax practice

The re-election of President Obama is likely to result in substantial changes for taxpayers, especially with the expiration of the Bush-era tax rates approaching.

President Barack Obama delivered his acceptance speech early Wednesday morning after winning re-election in a hard-fought campaign against Republican rival Mitt Romney as the U.S. faces the risk of another plunge into recession with the expiration of the current tax rates coupled with deep automatic spending cuts.

The Internal Revenue Service’s decision to modify the timelines for withholding agents and foreign banks to comply with the stiff new due diligence requirements under the Foreign Account Tax Compliance Act is providing them, as well as taxpayers and preparers, with some welcome relief.

The IRS has issued procedures in Revenue Procedure 2012-43 concerning under what circumstances a frivolous tax submission penalty would be reduced. The procedure also details how a taxpayer may request a reduction in the penalty, which is assessed under Code Sec. 6702(a) or Code Sec. 6702(b), and the eligibility requirements for reduction.

The IRS is now sending letters to preparers who are suspected of filing inaccurate EITC claims.

The Internal Revenue Service needs to improve its efforts in investigating whether its own employees are inappropriately accessing taxpayer data, according to a new government report.

Jackson Hewitt Tax Service wants preparers and their clients to be aware of key disaster-related tax considerations in the wake of Superstorm Sandy.

The Internal Revenue Service is taking issue with a new report from the Treasury Inspector General for Tax Administration that faults the IRS for taking longer than expected to upgrade its computer systems to allow the use of SmartID cards for improved security.

Federal, state and local authorities have issued various forms of tax relief for those affected by Hurricane Sandy last week.

The H&R Block blog offers several tips for tax preparers to help clients recover from the devastation of Hurricane Sandy.

The IRS e-Services suite of services, including the transcript delivery system, the e-file application, the disclosure authorization and TIN matching will be unavailable from Saturday, November 3, at 9 p.m. Eastern, until Monday, November 5, at 6 a.m. for maintenance.

The Internal Revenue Service has made progress in automating installation and monitoring in a large segment of its computers, but it hasn't yet implemented key patch management policies and procedures, according to a new report by the Treasury Inspector General for Tax Administration.

Accounting Today's updated round-up of Hurricane Sandy news, as its aftermath continues to impact the profession. For more updates, follow the #Sandy hashtag on our Twitter accounts @AccountingToday, @TaxProToday and @ATomorrow.

In 2005, the Internal Revenue Service finalized substantial revisions to Circular 230 governing the rules for practice before the IRS. The revisions were in response to what was believed by the IRS to be improper practices in the preparation of tax opinions in support of tax-sheltering transactions. The IRS believed that tax practitioners were relying in their opinions on statements and representations from the tax shelter promoters that they knew or had reason to believe were not accurate.

Highlights from the world of tax from the previous month

Don't lose the Circular 230 legend just yet

With few resources and a growing problem, the IRS is struggling

The IRS is granting taxpayers and tax preparers affected by Hurricane Sandy until November 7 to file returns and accompanying payments.

Marketing season is well underway for preparers readying for Tax Season 2013, and a recent discussion on the LinkedIn Tax Business Owners of America group revealed several pointers for preparers.

A new study by tax prep software provider Drake Software reveals that tax preparers have taken to certain avenues of social media such as Facebook and LinkedIn, but that most still have these communication and network tools on the to-do list.