Tax research

The Treasury Department has made three new appointments to the Office of Tax Policy.Michael J. Desmond was named tax legislative counsel, Harry J. "Hal" Hicks III was named international tax counsel and Robert H. Dilworth was named senior advisor.

The Internal Revenue Service is seeking 84,290 taxpayers whose income tax refund checks could not be delivered in 2005. Checks totaling approximately $73 million can be reissued as soon as taxpayers correct or update their addresses with the IRS.In some cases, a taxpayer has more than one check waiting. The average amount owed to each taxpayer is $871.

$6.1B KATRINA RELIEF BILL HEADS TO PRESIDENT: Despite concerns over the rising deficit, both houses of Congress sent a $6.1 billion Katrina tax-relief bill to President Bush for his signature without a dissenting vote being cast.The House gave its approval on a 422-0 vote, and the Senate moved the legislation through without a roll call. At press time, the president was expected to sign it.

Internal Revenue Service Commissioner Mark W. Everson estimated that the current tax gap - the difference between taxes owed and collected - is $300 billion.That money is legitimately owed to the government and would do a lot of good ... if it could be collected.

The Nelson A. Rockefeller Institute of Government issued a report detailing a 13.3 percent average increase in state tax revenues across the country. The report, "State Revenue Growth Continues in Most States," compared revenues from the second quarter of 2005 to the same period in 2004. The growth percentage was the fastest since 1991, when the public policy research arm of the State University of New York began tracking state revenues."The growth in overall collections from final settlements is generally stronger than states had anticipated," said senior policy analyst Nicholas Jenny, in a statement. "It's now getting back into the range of the growth in final settlements states experienced regularly from the mid-1990s through 2001. This favorable 'April surprise' has put many states in a budget surplus position."

Gov. Arnold Schwarzenegger vetoed several bills that would have strengthened the enforcement of business tax laws in California.

Complying with the federal tax code costs American taxpayers at least $100 billion annually, and lost economic efficiency associated with the tax system may top half a trillion dollars, auditors for the Government Accountability Office told Congress.In a report likely to add fuel to the campaign for an easy-to-administer national consumption tax, the GAO said that the lowest available estimates of the cost of complying with federal income, payroll and excise taxes is $107 billion - a whopping 1 percent of the nation's total gross domestic product. Other studies suggest that compliance costs may be 50 percent higher than these estimates.

A federal prosecutor asked a Los Angeles judge to deny bail to a former KPMG partner indicted in the government's tax shelter fraud case, calling him a flight risk.

With the President's Advisory Panel on Federal Tax Reform due to report Nov. 1, we asked industry leaders, many who made Accounting Today's recently released 2005 Top 100 Most Influential People list, to tell us what sort of tax system they would create.

Two proposals for tax reform took definitive shape at the latest meeting of the President's Advisory Panel on Federal Tax Reform. The panel's final report is due Nov. 1.

The Tax Policy Center, a nonpartisan joint venture of the Urban Institute and Brookings Institution, has established a new Web page dedicated to the President's Advisory Panel on Federal Tax Reform, providing a number of links to relevant research and testimony.

The Government Accountability Office said that the Internal Revenue Service should work with federal agencies to make sure companies follow rules prohibiting tax deductions for fines and penalties paid in civil settlements.

The American Institute of CPAs has released a nonpartisan tax reform report, titled, "Understanding Tax Reform: A Guide to 21 st Century Alternatives." The report is meant as an overview to understanding major issues in the debate over making changes to the country's system.

Gov. Phil Bredesen has told Nashville business leaders that he will not seek a state income tax if re-elected in 2006. Bredesen made the same promise before his first term, but had refused to extend the pledge as he campaigns for a second term.

The Internal Revenue Service could revoke the tax-exempt status of about 20 credit-counseling firms, just as the country's new bankruptcy laws are set to go into effect on Oct. 17.

With the President's Advisory Panel on Federal Tax Reform due to report Nov. 1, we asked industry leaders, many who made Accounting Today's recently released 2005 Top 100 Most Influential People list, to tell us what sort of tax system they would create.

Bolstered by higher sales and lower costs, consulting giant Accenture posted a 25 percent hike in fourth-quarter profits, to $229.1 million, versus the year-ago period.

Meeting for the first time since July, the President's Advisory Panel on Federal Tax Reform began focusing discussions on what recommendations will be included in its report, due on Nov. 1.

Adelphia Communications Corp. founder John Rigas and his son, Timothy, were indicted by federal prosecutors on charges of engaging in a $300 million tax evasion scheme. Both men were found guilty of fraud earlier this year in connection with accounting fraud at the bankrupt cable company.

KPMG ANNOUNCES NEW TAX SERVICES HEADS: Moving on from its recent legal troubles, KPMG named vice chairs for its tax services and tax services operations.Shaun T. Kelly, 46, and Frederick S. "Rick" Smith, 49, will take over the respective tax leadership roles effective at the end of the fiscal year on Sept. 30. Tax services vice chair James Brasher will assume other significant duties within KPMG's organization, while operations vice chair John Chopack will retire in early 2006, as previously planned.