Tax Break

Essential reading: Waiting on the phone for the IRS, and more

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

 * Tactics for getting the IRS on the phone. Ann Carrns – The New York Times. Millions of people call the IRS each year. Last tax season, the average wait time to speak to a live representative was 17 minutes, up from 12 minutes in 2011, the Government Accountability Office found. Link

 * James Tobin’s big idea is back, again. David Cottle – The Wall Street Journal. The European Commission wants to press ahead with an EU-wide tax on secondary-market bond, equity and derivatives transactions, which it called for in 2011. However, at present it seems that only 11 out of 17 euro-zone countries intend to apply the tax. Link 

 * Accountant-advisers tackle tax-time crunch. Thomas Coyle – The Wall Street Journal. For the growing ranks of those who also offer investment and financial planning, it poses a special challenge: While you’re scrambling to keep up with the demands of tax-filing season – typically putting in late nights and weekends – how do you meet your clients’ other needs? Link

 * Amazon will charge sales tax in Connecticut. Stephen Singer – The Boston Globe. Amazon said on Monday that it has agreed to collect Connecticut’s sales tax, ending a two-year dispute over the tax that the online retailer had previously refused to charge. Link 

 * Shell to challenge Indian tax demand. James Crabtree – The Financial Times. The Indian subsidiary of Royal Dutch Shell has said it plans to challenge a tax order related to the underpricing of a share sale to its parent company in 2009. Link 

Essential reading: Democrats target corporate tax breaks, and more

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

 * Democrats target corporate tax breaks. James Politi – The Financial Times. Senate Democrats want to slash corporate tax breaks in search of new revenue, as an alternative to $1.2 trillion in impending across-the-board spending cuts, digging in against Republicans who are opposed to higher taxes and stoking calls for a revival of bipartisan deficit talks. Link

 * ‘Tobin tax’ push causes dismay. Chris Flood – The Financial Times. The European Commission appears determined to press ahead with a Europe-wide financial transaction tax in spite of warnings that it threatens the existence of Europe’s 1 trillion euro ($1.37 trillion) money market funds industry. Link 

 * Accounting group hits back at politicians. Adam Jones – The Financial Times. Politicians are unfairly demonising accountants over tax avoidance, according to the head of the UK’s leading accounting institute. The hit back comes after tax experts from the four biggest accounting firms were accused of undermining “the public good” in parliament last week. Link

Essential reading: Early payouts of dividends, bonuses spur a windfall, and more

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

 * Early payouts of dividends, bonuses spur a windfall. Josh Mitchell – The Wall Street Journal. Many Americans got a happy financial surprise at the end of last year, as companies pulled forward payouts of dividends and bonuses to beat anticipated January tax increases. Link  

* Exelon to take $270 million charge in tax dispute. Julie Wernau – The Chicago Tribune. The IRS is claiming that ComEd used a financial arrangement called sale-in, lease-out (SILO) in which a tax-exempt entity sells an asset to a private company and leases the asset back, a tax shelter mechanism the IRS decided in 2005 is abusive. Link  


Some important tax and accounting events in the week ahead:

Tuesday, Feb. 5

* National taxpayer advocate Nina Olson joins a panel on 100 years of the federal income tax. Noon – 1:30 p.m. ET, the Urban Institute. Washington.

* D.C. Bar taxation section lunch program on the taxation of financial products. Noon – 1:30 p.m. ET, D.C. Bar Conference Center. Washington.

 Wednesday, Feb. 6

* American Bar Association section of taxation webinar on intragroup spinoffs, liquidations and reorganizations. 1 – 2:30 p.m. ET.

Essential reading: U.S. is preparing more tax-evasion cases, and more

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

 * U.S. is preparing more tax-evasion cases. Laura Saunders – The Wall Street Journal. The U.S. is expanding its crackdown of offshore tax evasion, preparing numerous criminal cases against suspected offenders, defense lawyers involved in the cases say. Link  

* Federal rule limits aid to families who can’t afford employers’ health coverage. Robert Pear – The New York Times. In deciding whether an employer’s health plan is affordable, the Internal Revenue Service said it would look at the cost of coverage only for an individual employee, not for a family. Family coverage might be prohibitively expensive, but federal subsidies would not be available to help buy insurance for children in the family. Link  

* Workers’ children won’t get subsidies. Louise Radnofsky – The Wall Street Journal. Federal tax subsidies under the 2010 health law designed to help lower-income Americans afford insurance won’t extend to dependents who can be covered through a family member’s employer. Link  

Essential reading: India sees end to Vodafone tax dispute, and more

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

* India sees end to Vodafone tax dispute. James Blitz and Lionel Barber – The Financial Times. India’s finance minister is confident that a $2.6 billion tax dispute with Vodafone is close to being settled as the Indian government attempts to win back international investor confidence. Link  

* Amazon’s growing problem. Justin Lahart – The Wall Street Journal. The holiday season really was a taxing time for Texas in July and California and Pennsylvania in September started collecting online sales taxes. Together, the three states account for a quarter of the U.S. population, so a fair-sized chunk of American shoppers had one less reason to buy online. Link 

* Corning CFO cheers tax extensions. Vipal Monga – The Wall Street Journal. Corning Inc. will get a slight earnings boost starting in the first quarter of this year thanks to provisions in the fiscal cliff deal reached earlier this month, according to the glass and ceramics maker’s chief financial officer. The company’s projected 2013 tax rate will be lower than earlier projections. Link  

Essential reading: Mickelson and the sports star migration, and more

Golfer Phil Mickelson of the U.S. REUTERS/Hans Deryk

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

Mickelson and the sports star migration. Allysia Finley – The Wall Street Journal opinion. America’s top-grossing golfer Phil Mickelson drove himself into a bunker on Jan. 20 when he said that federal and California state tax hikes had made him contemplate making “drastic changes” in his life —including, it was widely assumed, moving to a no-income-tax state such as Texas or Florida. But he was only stating publicly what many professional athletes are mulling privately. Link

Bank of America shifts derivatives to UK. Patrick Jenkins – The Financial Times. The move, part of the group’s global drive to rationalize its operations, has been encouraged by regulators but will also allow BofA to benefit from tax breaks stemming from the accumulated losses in its UK business. Link

Japan embraces modest business, investment tax breaks. Misuru Obe – The Wall Street Journal. As part of its evolving economic stimulus plan, the new Japanese government is adding a package of modest corporate and investment tax breaks to a big boost in government spending and a fresh dose of monetary easing from the Bank of Japan. Link  


Some important events in the week ahead:

Monday, Jan. 28 – Wednesday, Jan. 30

University of Southern California Gould School of Law Tax Institute on business tax planning, estate tax planning and other topics. Los Angeles.

Tuesday, Jan. 29 – Friday, Feb. 1

Council on State Taxation’s annual state and local tax “basics school”. Atlanta.

Wednesday, Jan. 30

Joint Webcast meeting of the Financial Accounting Standards Board and the International Accounting Standards Board covers revenue recognition, insurance contracts and lease accounting. Norwalk, Connecticut, and London.

Essential reading: Republican governors open new front in tax debate, and more

Governor Sam Brownback has cut taxes in Kansas. REUTERS/Mike Segar.

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

 * Republican governors open new front in tax debate. Richard Stevenson – The New York Times. Overhauling the tax system is the subject of endless talk and little action in Washington. But Republican governors in a range of states are setting up limited but politically ambitious and potentially telling experiments in what might be possible nationwide. Link

* Towns’ next hit from hurricane is to tax revenue. Alison Leigh Cowan – The New York Times. Localities across the New York region, already reeling from the cost of cleaning up from Hurricane Sandy, are confronting the prospect of an even bigger blow to their finances: a precipitous decline in property tax revenues.  

* US taxes: Certain as death, complicated as hell. James Politi – The Financial Times. The US tax code is under scrutiny as an international outlier that is unable to raise sufficient revenue at a time of big budgetary pressures – and is stifling America’s economic potential and competitiveness at a time when the country is desperately seeking to shift towards a faster recovery. Link  

Essential reading: Firms keep stockpiles of ‘foreign’ cash in U.S., and more

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

* Firms keep stockpiles of ‘foreign’ cash in U.S. Kate Linebaugh – The Wall Street Journal. For people on both sides of the contentious debate over corporate-tax reform, the situation highlights what they see as the absurdity of rules that encourage companies to engage in semantic games, legal gymnastics and inefficient corporate-financing methods to shield profits from U.S. taxes. Link

* Microsoft may avoid repatriation on any Dell investment. Vipal Monga – The Wall Street Journal. Microsoft Corp. may be able to deploy foreign cash to help finance a buyout of U.S. computer maker Dell Inc. without triggering repatriation taxes. Microsoft could exploit an exception in the tax code so long as its investment in Dell doesn’t surpass 25 percent. Link

* Now, Democrats push tax-code rewrite. John McKinnon – The Wall Street Journal. Suddenly it’s Democrats who are talking up a tax-code rewrite, long a favorite cause for Republicans. But reaching agreement in the short run still looks like a long shot. “We must … revamp our tax code,” President Barack Obama said in his inaugural address on Monday. Link