Tax practice

In an effort to provide relief for the victims of Hurricane Katrina, the Internal Revenue Service said it would accelerate its review and approval process for new organizations seeking tax-exempt status in order to provide relief for victims of Hurricane Katrina.

The Internal Revenue Service currently has no corporate strategy to combat identify theft, according to the Treasury Inspector General for Tax Administration. Until it adopts an agency-wide strategy, it will be unable to help taxpayers and the government combat what TIGTA calls "the growing threat" of identity theft and support the prosecution of offenders.

A federal judge has filed paperwork alerting the Internal Revenue Service that he plans to halt their experiment in outsourcing debt collection, siding with a Texas company that claimed they had been unfairly excluded from the bidding process.

IRS TO PAY FOR INFORMATION DISCLOSURES: A judge has ordered the Internal Revenue Service to pay more than $250,000 after determining that an IRS agent disclosed confidential information during a criminal investigation.

The Energy Tax Incentives Act of 2005, passed as part of the 2005 Energy Act and signed by President Bush on Aug. 8, 2005, includes a series of new credits aimed at encouraging the purchase of various types of new alternative fuel vehicles.

With Congress preparing to reconvene in early September, Senate Majority Leader William H. Frist said a vote to fully repeal the estate tax will be tops on the to-do list.

The Internal Revenue Service will offer special relief to taxpayers in the disaster areas struck by Hurricane Katrina.

The 12th meeting of the President's Advisory Panel on Federal Tax Reform will be held on Sept. 15 in Washington.

Completing a two-year project to shutter abusive transactions of 412(i) plans and other arrangements, the Treasury and the Internal Revenue Service have issued final regulations clarifying that any life insurance contract transferred from an employer or a tax-qualified plan to an employee must be taxed at full fair market value.

Minnesota's Department of Revenue will give residents who have used abusive tax shelters until Jan. 31 to amend their tax returns without facing new penalties passed during the 2005 special legislative session.

The 11th meeting of the President's Advisory Panel on Federal Tax Reform will be held on Sept. 8 in Washington.

The U.S. Treasury Department and Internal Revenue Service announced proposed regulations that provide further guidance to Section 482, which determines taxable income in connection with cost-sharing arrangements affecting intellectual property.

A Council On State Taxation representative told the National Conference of State Legislatures they should expect a hearing before the Senate Finance Committee this fall.

A recent report from Government Accountability Office says that the Internal Revenue Service needs to establish a more "results-oriented approach" to reducing the tax gap -- the difference between taxes owed and taxes paid in the country.

* IRS SUSPENDS PLAN TO CLOSE ASSISTANCE CENTERS: The Internal Revenue Service will scrap its plans to close 68 Taxpayer Assistance Centers after Congress insisted the agency further study the potential impact of the closures.

The AMT Credit Fairness Act has been introduced in the House with significant bipartisan sponsorship. The bill provides relief for incentive stock option alternative minimum tax victims by accelerating the refund of stranded ISO AMT overpayment credits that, under current law, would not be returned within the taxpayer's lifetime.

IRAs, 401(k)s and similar retirement savings vehicles have experienced phenomenal growth over the past several years, both in terms of the number of participants and in the sheer dollar value of those accounts. Unfortunately, the opportunities to run afoul of the qualified withdrawal rules also have grown. These missteps by account owners have not gone unnoticed by either the Internal Revenue Service or the courts.

Studies conducted by the Treasury Inspector General for Tax Administration over the past two tax filing seasons criticize the Internal Revenue Service's use of training programs.

The Internal Revenue Service was recognized for its community-based partnerships linking low-income taxpayers with organizations that prepare tax returns for free, ensure they properly receive tax credits and assist them with ways to build financial savings.

National Taxpayer Advocate Nina E. Olson urged the Internal Revenue Service to focus more broadly on steps to increase voluntary compliance.