Tax practice

The U.S. Court of Federal Claims ruled against a family's attempt to avoid taxes on $204 million in gain realized on the sale of their business by using a tax shelter.

Sen. Barack Obama, D-Ill., called for an "emergency energy rebate" of $1,000 to be offered to families this fall, along with a $50 billion stimulus package to help jump-start job creation.

The Internal Revenue Service has seized over $24 million from two companies that were processing payments for an Internet gambling site, Bodog.com.

The 80 percent e-file goal, in place since it was proposed in the IRS Restructuring and Reform Act of 1998, was a major contributing factor to the growth in electronic filing, despite the fact that it fell short of the 2007 deadline, according to the Internal Revenue Service Oversight Board.

WRONG CALCULATIONS MAY AFFECT STIMULUS PAYMENTS

One of the advantages of the complexity brought on by social engineering in the Tax Code is that, when personal circumstances change and times get rough, there are usually some provisions in the code that come into play to provide a bit of tax relief. Tax practitioners can do a real service for their clients by alerting them to new or existing tax provisions that might be applicable to a particular taxpayer for the first time. Some of them may require the taxpayer to maintain records or be aware of requirements during the course of the year, so alerting them only at tax return preparation time may be too late for some of the tax benefits.

The Internal Revenue Service has proposed amending its regulations to provide further guidance to taxpayers in the home construction industry.

A Florida man was arrested for trying to hire a hit man to kill an Internal Revenue Service employee who had been investigating his personal and business tax liabilities.

The Senate Finance Committee held a hearing on incentives for providing health benefits in the Tax Code.

The Internal Revenue Service has released draft revisions of the Corporate 1120 and Partnership 1065 tax forms, along with related schedules, for public comment.

President Bush has signed into law a bill that will help homeowners facing foreclosure and shore up Fannie Mae and Freddie Mac.

Over 1.6 million businesses owed more than $58 billion in unpaid federal payroll taxes, including interest and penalties, as of last September, according to a new report.

Sen. John McCain, R-Ariz., is provoking some ire among conservatives for a comment he made Sunday that appears to be a bit of a retreat from his no-tax-increase pledge.

The Senate has passed a housing rescue plan by a vote of 72-13 aimed at stemming the tide of foreclosures and shoring up Fannie Mae and Freddie Mac.

BDO Seidman reported that its annual revenue increased 11.9 percent to $659 million for the fiscal year ended June 30, 2008 from $589 million the previous fiscal year.

The plunge in home prices in the U.S. as a result of the collapse of the subprime mortgage market may force banks and lenders to write down as much as $1 trillion from their balance sheets according to one expert.Bill Gross, who manages Pacific Investments Management Co. -- the largest bond fund in the world -- said the massive writedowns would blunt bank lending as well as force the sales of assets.

Senators Max Baucus, D-Mont. and Chuck Grassley, R-Iowa, chairman and ranking member of the Senate Finance Committee, announced they would introduce six new measures to curb offshore tax evasion. The steps include: * Lengthening the statute of limitations for prosecuting individuals who fail to file a foreign bank account report. * Clarifying IRS authority to enforce filing requirements for these reports. * Clarifying the information that must be included in these reports. * Requiring taxpayers to file the reports with their individual and corporate income tax returns. * Revising the definition of ownership to include beneficial ownership of a corporation. * Including the reports in the Tax Code section that causes the statute of limitations not to expire before three years after the taxpayer furnishes the required information. The announcement was made at a hearing to discuss the findings of the Government Accountability Office investigation into the Ugland House, a law firm's office building in the Cayman Islands and the registered home to thousands of corporations. "Plainly, there's a lot of financial activity in the Caymans," said Baucus. "There's a virtual feast going on down there. That has led to some crowded halls in the Ugland House. And up to half of those Ugland House tenants - around 9,000 entities - are Americans." The investigation into Ugland House is somewhat misguided, according to Daniel J. Mitchell, senior fellow at Cato Institute. "The implication is there can't be 10,000 businesses in this building, but where a company is registered has nothing to do with where they conduct business. Companies are registered in Delaware because they have very good corporate and tax law. No one will argue that it's not normal to go to a jurisdiction that is very well regulated and regarded and where the courts are honest, as in the Cayman Islands."

The Securities and Exchange Commission and the Federal Reserve are each pushing to gain regulatory authority over investment banks. At a hearing on Capitol Hill, SEC Chairman Christopher Cox and New York Federal Reserve President Timothy F. Geithner each outlined plans for the monitoring of commercial and investment banks. Both laid blame for the "patchwork" of regulatory agencies in lieu of one overseer for much of the current roiling of the financial markets. Cox urged lawmakers to give his agency responsibility over investment banks pointing out that the commission currently has authority over the markets in which they operate. Earlier this year, the Treasury Department proposed merging the SEC and the Commodity Futures Trading Commission into a single entity while expanding the oversight capacity of the Federal Reserve.

The House passed a bill aimed at shoring up the mortgage industry and preventing foreclosures after the president dropped his veto threat.

The Senate Finance Committee held a hearing on the use of offshore corporate tax shelters in the Cayman Islands, on the heels of hearings elsewhere in the Senate on individual tax havens in Switzerland and Liechtenstein.