Tax Break

Essential reading: Tax breaks versus spending, and more

Welcome to the top tax and accounting headlines from Reuters and other sources.

 * Tax credits or spending? Labels, but in Congress, fighting words. Annie Lowrey – The New York Times. In budget proposals put forward last week, both Democrats and Republicans called for scrubbing billions of dollars’ worth of the popular deductions, loopholes and credits that litter the tax code. But the two sides are sharply divided what should happen to any revenue raised. Link    

 * Republican Sen. Corker opens the door to new tax revenue. Sean Sullivan – The Washington Post. Republican Sen. Bob Corker of Tennessee said Sunday that he believes Republicans would consider adding new tax revenues by closing loopholes if Democrats show a willingness to embrace “true” entitlement reform. Link    

* It’s a lonely quest for land-tax fans, but, by George, they press on. Ianthe Jeanne Dugan – The Wall Street Journal. Only about 20 towns in the U.S. have adopted the land value tax. In Australia the concept is widespread, and it has surfaced in Taiwan. Link 

* Breweries launch ‘High Tax Ale’ to urge change. The Associated Press. A special joint offering from two Tennessee craft beer brewers features an unusual sales pitch to beer aficionados: “Now With Even More Taxes!” Link    

 * When Uncle Sam wants his money back. Robert Powell – The Wall Street Journal. The rules for income tax on Social Security payouts have long confounded beneficiaries—and can make it harder to stretch a dollar in retirement. Link 


Some important tax and accounting dates in the week ahead:

 Sunday, March 17 – Wednesday, March 20

Tax Executives Institute mid-year conference features speakers including E. Ray Beeman, tax counsel and special adviser for tax reform to the U.S. House of Representatives Committee on Ways and Means, former U.S. Senator Olympia Snowe, and tax experts from the Organisation for Economic Co-operation and Development and the Internal Revenue Service. Washington.

 Monday, March 18

Former congressional tax aides address an American Institute of Certified Public Accountants briefing on the ongoing effort to reform the federal tax code and how current efforts compare to the last major overhaul in 1986. 9 a.m. ET, Willard Hotel Office Building. Washington.

 Monday, March 18 – Friday, March 22

American Bar Association Section of Taxation and the Institute for Professionals in Taxation seminar series on income, sales and property tax. The Ritz-Carlton. New Orleans.

Essential reading: Congress begins tax reform talks, and more

Welcome to the top tax and accounting headlines from Reuters and other sources.

* Congress begins meetings on tax reform. Zachery Goldfarb and Lori Montgomery – The Washington Post. Members of the Senate Finance Committee from both parties met for the first time Thursday to start laying the groundwork for legislation to overhaul the tax code, as the House Ways and Means Committee engages in a similar bipartisan effort. Link

* Mining austerity era is bad news for the tax collector. Tom Gara – The Wall Street Journal. The mining industry boom is now coming to an end, and governments that grew accustomed to healthy tax and fee revenue from miners are feeling the pinch. Link 

* Tax refund deadline nears. Laura Saunders – The Wall Street Journal. Tax refunds totaling over $900 million may await an estimated 984,400 people who did not file a federal tax return for 2009, the Internal Revenue Service said. Half the potential refunds are more than $500. Link

Essential reading: Senate Democrats propose new taxes, and more

Welcome to the top tax and accounting headlines from Reuters and other sources.

* Democrats’ budget mixes tax increases, spending cuts. Kristina Peterson – The Wall Street Journal. Senate Democrats will propose on Wednesday raising $975 billion in new taxes over the next decade in the budget they will release this week, setting up a sharp contrast with a House Republican plan to balance the budget over 10 years without new tax increases. Link 

* Ryan sets stage for a budget duel, targets healthcare law. Lori Montgomery – The Washington Post. The Obama administration official acknowledged that the dueling budget blueprints illustrate the immense challenge of trying to forge a compromise between a president and Republicans, who refuse to consider any additional revenue beyond the relatively modest tax increase adopted Jan. 1. Link    

* Guide: Why the budget process matters. John McKinnon – The Wall Street Journal. It’s worth remembering that it’s highly unlikely the House and Senate will reach agreement on a budget this year, given how far apart they are on spending and tax issues. Link    

Essential reading: Yankees embrace frugality to dodge tax, and more

New York Yankees then manager Joe Torre (L) puts a Yankees cap on Alex Rodriguez, one of the  highest paid players in baseball. February 17, 2004 REUTERS/Peter Morgan

Welcome to the top tax and accounting headlines from Reuters and other sources.

* Penny-pinching in pinstripes? Yes, the Yanks are reining in pay. David Waldstein – The New York Times. The Yankees no longer want to pay Major League Baseball’s luxury tax, after spending years of happily soaring beyond the payroll threshold that determines that tax. Link    

* House and Senate work simultaneously to create budgets, a rarity. Jeremy Peters – The New York Times. The Democrats plan to rely heavily on closing tax loopholes that benefit corporations and the wealthy to produce new revenue, while Republicans will focus on slashing spending to balance the budget in 10 years. Link 

Essential reading: Companies’ profits abroad save on taxes, and more

Welcome to the top tax and accounting headlines from Reuters and other sources.

* More U.S. profits parked abroad, saving on taxes. Scott Thurm and Kate Linebaugh – The Wall Street Journal. A Wall Street Journal analysis of 60 big U.S. companies found that, together, they parked a total of $166 billion offshore last year. That shielded more than 40 percent of their annual profits from U.S. taxes. Link

* As momentum builds toward tax reform, lobbyists prepare for a fight. Jerry Markon – The Washington Post. Lobbying over the tax code has more than tripled since President Barack Obama took office, disclosure records show. Link 

* Overseas tax savings for U.S. drugmakers under threat. Drew Armstrong – Bloomberg news. The six biggest U.S. drugmakers avoided paying $7.05 billion in U.S. taxes last year by shifting their profits overseas. That’s almost double the amount they saved using the same strategy 10 years earlier, according to data compiled by Bloomberg. Link


People relax in one of the Blue Lagoon hot springs near the town of Grindavik, Iceland. February 14, 2013. REUTERS/Stoyan Nenov

Some important tax and accounting dates in the days ahead:

Thursday, March 14

Jefferson VanderWolk, international tax counsel, Senate Finance Committee, speaks on International Tax Institute panel on foreign tax law and its relevance in resolving U.S. tax law issues. 12:15 – 2 p.m. ET, Grand Hyatt. New York.

Friday, March 15

* U.S. Public Company Accounting Oversight Board chairman James Doty speaks at the University of Missouri Orin Ethics Symposium. Columbia, Missouri.

Essential reading: Tax haven hunter Levin to retire, and more

Welcome to the top tax and accounting headlines from Reuters and other sources.

* Michigan Sen. Carl Levin will not seek reelection. Rachel Weiner and Aaron Blake – The Washington Post. As chairman of the Senate Permanent Subcommittee on Investigations, Carl Levin has investigated Enron, the credit card industry, the 2008 financial crisis, and offshore tax havens. Link

* IASB loan-loss proposal a test for convergence. Emily Chasan – The Wall Street Journal. International accounting rulemakers have, for now, agreed to disagree with U.S. accounting standard setters on a new model for companies to account for credit losses, adding another delay to the convergence process between the two rulemakers. Link    

* Obama continues Congressional outreach with White House lunch. Jackie Calmes – The New York Times. On Capitol Hill, there was guarded optimism that these meetings would continue to be productive. Though the vast political differences between the two parties on issues like taxes and spending were hardly far from leaders’ minds. Link

State defections impact U.S. interstate tax compact

Worried about challenges to their corporate tax base, some U.S. states have started to modify their participation in the Multistate Tax Compact, with a few withdrawing altogether.

The 45-year-old compact was forged to ensure companies operating in multiple states do not pay tax on the same income in more than one state. It also benefited the states by helping them fight off then-pending federal intervention on the topic.

Now that some states are pulling out, the question arises: What impact will this have on the compact and its administrator, the Multistate Tax Commission?

Essential reading US fights offshore tax evasion, and more

Welcome to the top tax and accounting headlines from Reuters and other sources.

* Offshore tax probe picks up. Laura Saunders – The Wall Street Journal. After getting a guilty plea from Switzerland’s oldest private bank, which was ordered Monday to pay a total of $74 million for violating U.S. tax laws, federal investigators have fresh momentum thanks to leads gathered from interviews with confessed tax cheats. Link 

 * House GOP plans a budget that retains tax increases and Medicare cuts. Jonathan Weisman – The New York Times. House Republicans will preserve Medicare cuts and accept tax increases they sternly opposed just months ago in a new tax-and-spending blueprint, senior Republicans said Wednesday. Link

 * IRS amnesty for employers of household help. Arden Dale – The Wall Street Journal. Employing a nanny or other household workers can open a can of worms with the Internal Revenue Service, but the agency wants to make it easier for someone who mishandles taxes for their hired help to put things right. Link