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Apr 7, 2014

IRS whistleblower payouts down, critics say program too slow

WASHINGTON (Reuters) – The U.S. Internal Revenue Service reported it made progress last year in rewarding tax whistleblowers with a few big cash payouts, but critics said the tax agency is still struggling to act quickly on informants’ tips.

For the fiscal year ended September 30, the IRS said late last week that it paid whistleblowers $53.1 million, down from $125.4 million in 2012; $8 million in 2011; and $18.7 million in 2010.

Apr 2, 2014

U.S. gives foreign banks more time on anti-tax dodge law

WASHINGTON (Reuters) – The U.S. Treasury Department on Wednesday gave foreign financial institutions 10 extra days to register with the U.S. government, under a new law to combat offshore tax dodging by Americans that goes into effect on July 1.

Under the Foreign Account Tax Compliance Act (FATCA), foreign banks, insurers and investment funds must send the Internal Revenue Service information about Americans’ and U.S. permanent residents’ offshore accounts worth more than $50,000.

Apr 1, 2014

Caterpillar defends taxes attacked by U.S. Senate Democrat

WASHINGTON (Reuters) – Caterpillar Inc defended itself on Tuesday against accusations of offshore tax-dodging, telling a U.S. Senate panel that a low-tax unit the company set up years ago in Switzerland has not been challenged by U.S. tax authorities.

Executives from the world’s largest maker of mining and construction equipment were hauled in front of the Senate Permanent Subcommittee on Investigations to answer to allegations made by the panel in a 99-page report.

Apr 1, 2014

Republicans defend Caterpillar, blast U.S. tax code at hearing

WASHINGTON (Reuters) – The broken U.S. tax code encourages companies to shift profits overseas, Republican senators said on Tuesday, seeking to deflect criticism from Caterpillar Inc at a hearing on how it allegedly avoided paying $2.4 billion in taxes.

The world’s largest maker of mining and construction equipment was only acting in its shareholders’ best interests, and in a wholly legal manner, Republicans said at the Senate Permanent Subcommittee on Investigations hearing.

Mar 31, 2014

Caterpillar’s Swiss unit dodged $2.4 bln of U.S. taxes -Senate panel

WASHINGTON, March 31 (Reuters) – Caterpillar Inc
avoided paying $2.4 billion in U.S. taxes from 2000 through 2012
by moving profits from sales of replacement parts through a
low-tax unit it set up in Switzerland, a congressional panel
said on Monday.

In the latest example of a major U.S. corporation’s offshore
tax strategies going under the congressional microscope, the
Senate Permanent Subcommittee on Investigations issued a report
focused on a complex 1999 restructuring by Caterpillar.

Mar 28, 2014

Caterpillar to face U.S. Senate panel on offshore taxes

WASHINGTON (Reuters) – Caterpillar Inc’s offshore tax strategies will come under scrutiny on Tuesday at a U.S. Senate hearing expected to examine dealings by the world’s largest mining and construction equipment maker in Switzerland, Bermuda and Luxembourg.

With many multinationals being criticized for tax avoidance, veteran tax sleuth Senator Carl Levin will chair another session of his Permanent Subcommittee on Investigations, with three current and former Caterpillar executives slated to testify.

Mar 26, 2014

Bitcoins are property, not currency, IRS says regarding taxes

WASHINGTON (Reuters) – Wading into a murky tax question for the digital age, the U.S. Internal Revenue Service said on Tuesday that bitcoins and other virtual currencies are to be treated, for tax purposes, as property and not as currency.

“General tax principles that apply to property transactions apply to transactions using virtual currency,” the IRS said in a statement, meaning that bitcoins would be taxed as ordinary income or as assets subject to capital gains taxes, depending on the circumstance.

Mar 25, 2014

Bitcoins taxed as property, not currency, IRS says

WASHINGTON (Reuters) – Wading into a murky tax question for the digital age, the U.S. Internal Revenue Service said on Tuesday that virtual currencies such as bitcoin are to be treated, for tax purposes, as property and not as currency.

Putting bitcoin and other virtual currencies in the same category as stocks or bonds in some instances, the IRS said in a statement: “General tax principles that apply to property transactions apply to transactions using virtual currency.”

Mar 25, 2014

Bitcoins taxed as property, not currency, IRS says

WASHINGTON, March 25 (Reuters) – Wading into a murky tax
question for the digital age, the U.S. Internal Revenue Service
said on Tuesday that virtual currencies such as bitcoin are to
be treated, for tax purposes, as property and not as currency.

Putting bitcoin and other virtual currencies in the same
category as stocks or bonds in some instances, the IRS said in a
statement: “General tax principles that apply to property
transactions apply to transactions using virtual currency.”

Mar 25, 2014

Companies must pay taxes on severance payments: U.S. high court

WASHINGTON (Reuters) – The U.S. Supreme Court ruled on Tuesday that taxes are due for Social Security and Medicare on severance packages paid to workers who are laid off involuntarily, overturning a lower court ruling that could have led to a wave of payroll tax refund requests from U.S. businesses.

In a win for the Obama administration and the U.S. Internal Revenue Service, the court voted 8-0 that Quality Stores Inc., a defunct retailer, and its employees are not entitled to tax refunds totaling about $1 million.