Tax research

The lead singer of the Isley Brothers, Ronald Isley, has been sentenced to three years and a month in prison for tax evasion charges.

Pitney Bowes Inc., a manufacturer of postage meters, mailing systems and other equipment, agreed to a $1.1 billion tax settlement with the Internal Revenue Service.

A complete overhaul of the federal income tax system - one of the top legislative priorities for President George W. Bush last year - appears to have slipped off of the administration's radar screen altogether in 2006, congressional leaders charged.The latest indication that White House interest in tax reform has cooled during the past year: Top Treasury Department officials declined to testify at a recent round of Senate Finance Committee hearings to discuss the issue.

In spite of efforts by the Internal Revenue Service to improve taxpayer compliance, the rate at which taxpayers pay their taxes voluntarily and on time has ranged from roughly 81 percent to about 84 percent over the past three decades, according to Michael Brostek, the director of tax issues for the Strategic Issues Team at the Government Accountability Office.The tax gap, measured by figures from the National Research Program's audit data from 2001 to 2004, is the difference between the amounts taxpayers pay voluntarily and on time, and what they should pay under the law.

While audits of high-income taxpayers have increased, the actual impact on compliance may be limited, according to a recent report from the Treasury Inspector General for Tax Administration.The inspector general found that while the Internal Revenue Service has increased its audits, the bulk of those have been conducted as correspondence examinations, which limit the issues that the agency can address compared with a face-to-face examination. The TIGTA report also said that the end compliance result could also be limited, because more than half of all wealthy taxpayer assessments are not collected in a timely manner.

IRS LAUNCHES ONLINE PAYMENT AGREEMENTS: Tax professionals will help launch a new system allowing many individuals who owe delinquent federal taxes to apply online for a payment agreement, the Internal Revenue Service announced.The IRS is implementing the new Online Payment Agreement application through national partnerships with the tax professional community. The application will eliminate the need to write or call the IRS toll-free number for assistance. The goal of the program is to provide an easier way for taxpayers to voluntarily resolve tax liabilities.

There have been three fundamental, evolutionary changes in the corporate tax function over the past 20 years with respect to its mission, its alignment with corporate strategy, and its influence on organizational behavior and resource allocation.The first, in the 1980s, focused on using technology applications to improve the efficiency and effectiveness of tax preparation, with cost reduction acting as the driver for improving business processes. The second, in the 1990s, involved value creation and developing holistic approaches to sustain tax minimization, which proved that the corporate tax function could positively affect the bottom line through effective tax planning.

A new report from the Treasury provides a detailed analysis of what effects proposals to permanently extend the tax cuts enacted in 2001 and 2003 might have on the country's economy.Among the cuts set to expire at the end of 2010 are:

Schedule M-3 is part of the effort by the Internal Revenue Service to get a better handle on abusive tax shelters and other aggressive tax techniques by getting sufficient detail on book/tax differences that it can guide IRS auditors to transactions in need of further examination.The IRS is sufficiently confident in its ability to track book/tax differences on Schedule M-3 that earlier this year it removed book/tax differences as a criteria required for reportable transactions. While the former Schedule M-1 required only 10 lines of information, Schedule M-3 expands that to 90 lines of information, with an emphasis on making a distinction between temporary and permanent book/tax differences.

The Internal Revenue Service announced that long-distance telephone customers will be able to seek refunds ranging from $30 to $60 on their 2006 tax refunds.

In an August letter, the Internal Revenue Service said that the NAACP did not violate its tax-exempt status when the civil rights group's chairman gave a speech criticizing President Bush.

The U.S. Department of Justice has asked a federal court in Fresno, Calif., to bar the former manager of a Jackson Hewitt franchise from preparing federal income tax returns.

Like most everyone else, Congress will return from its summer vacation in the coming week.

When I was child and invited to a birthday party, I almost always left with a bag of goodies, usually candy, maybe a lollipop, some chocolate bars, sour balls, and probably a piece of licorice.

In consideration of the continuing impact of Hurricane Katrina, the Internal Revenue Service has further postponed filing and payment requirements for businesses until Oct. 16, 2006, which is the same deadline established earlier for certain individual income tax return filers.The postponement now applies to individual, corporation, partnership, estate, trust, S corporation, generation-skipping, employment and certain excise tax returns with original or extended due dates that fall on or after Aug. 29, 2005, but before Oct. 16, 2006.

Tax and accounting software provider CCH, a Wolters Kluwer business, said it now offers Sales Tax Load Utilities for Sage Software, integrating CCH-supplied sales and use tax rates with such Sage accounting lines as MAS 90, MAS 200, MAS 500 and Accpac.CCH said that its Sales Tax Load Utilities eliminate tax managers having to track and manually update tax rates within their Sage accounting systems. Users can download monthly rate change information and load it directly into their accounting system tax tables.

The Internal Revenue Service announced that a draft of Form 8888, "Direct Deposit of Refund," a new form for taxpayers who opt to split their refunds among accounts, is now available for public comment.

After nine years, a federal report says that college tuition tax credits aren't necessarily providing the boon originally intended for poorer families.

By now, readers of this space are well aware of my skepticism about the efficiency of any program that is government-run. No matter how well-intentioned, they never turn out quite the way they're presented to those charged with initial approval.

The New York State Society of Public Accountants, the oldest state accounting association, representing approximately 30,000 CPAs, has offered certain suggestions regarding pending legislation in Congress affecting estate planning-- specifically emphasizing the pressing need for certainty and ease of administration with respect to the transfer tax.