Tax Break

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 Amazon.com. 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  

* IRS extends tax deadline for farmers, fishermen. John McKinnon – The Wall Street Journal. The Internal Revenue Service announced an extension in the filing deadline for many people who qualify as farmers or fishermen—yet another effect of the late approval of the “fiscal cliff” deal. Link  

* History-rich Georgia island wins second look on taxes. Robbie Brown – The New York Times. Residents of a tiny barrier island in Georgia on Tuesday won a temporary reprieve from property tax increases that they feared would drive them from their historic community. Taxes rose by as much as 1,000 percent last year on Sapelo Island. Link  

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.

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  

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 

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

 * Private equity seeks a new path. Jane Sasseen – The New York Times. As Washington grapples with the country’s fiscal woes, the private equity industry is grudgingly facing a new reality: its long-held tax advantages are likely to disappear. Link  

* Phil Mickelson says “drastic changes” coming over taxes, hints at retirement. Cindy Boren – The Washington Post. Professional golfer Phil Mickelson said “drastic changes” are ahead for him because of increases in the federal and California tax rates. Mickelson has more than $67 million in career earnings and was the seventh highest-paid athlete on Forbes’s 2012 list with $47.8 million in earnings (including $43 million in endorsements). Link  

* New term, new challenges for the president. John McKinnon – The Wall Street Journal. A look at some of the issues that will be prominent in President Barack Obama’s second term: Tax reform. House and Senate committee leaders say they will try to pass far-reaching legislation to overhaul the tax code this year, but prospects appear to be dimming amid continuing partisan budget battles and limited attention from the Obama administration so far. Link  

Some important tax and accounting events in the week to come:

Monday, Jan. 21 – Wednesday, Jan. 23

* American Institute of Certified Public Accountants personal financial planning conference. Las Vegas.

Tuesday, Jan. 22

* Internal Revenue Service acting senior technical adviser Jason Langley and other panelists discuss the 2013 filing season and the American Taxpayer Relief Act of 2012. Tax Talk Today Webcast. 2 p.m. ET.

Wednesday, Jan. 23 – Friday, Jan. 25

* Public Company Accounting Oversight Board member Jeanette Franzel, Securities and Exchange Commission chief accountant Paul Beswick, and division of corporate finance acting director Lona Nallengara, and others address Northwestern University School of Law’s annual securities regulation institute. Coronado, California.

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

* Greek parliament to probe tax list claims. Kerin Hope – The Financial Times. The Greek parliament voted on Thursday to probe allegations that former finance minister George Papaconstantinou failed to pursue possible tax evaders on a list of 2,000 Greeks with Swiss bank accounts provided by French authorities in 2010. Link

* Thompson says he wouldn’t raise taxes if elected mayor. David Chen – The New York Times. Differentiating himself from his likely Democratic rivals in the New York City mayoral race, William C. Thompson Jr. vowed on Thursday that he would not raise taxes if elected. Link

* A simpler form for home office deductions. Ann Carrns – The New York Times. If you work at a home-based business, the Internal Revenue Service has some (potentially) good news: It’s going to offer a simpler option for taking a tax deduction for home offices. The new option won’t be available for your 2012 return. It takes effect this year, for 2013 returns that are generally filed in early 2014. Link

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

* California budget hurt by Facebook’s stock-price slump. Vauhini Vara – The Wall Street Journal. Facebook Inc.’s disappointing IPO has claimed another victim: California’s budget. Aides to Democratic Gov. Jerry Brown last week lowered their estimate of how much revenue the state will get from Facebook’s initial public offering by nearly one-third, to $1.3 billion in the three years ending in June 2014, down from $1.9 billion. Link  

* Advisers give wealthy early attention to taxes. Arden Dale – The Wall Street Journal. Financial advisers are focused on their wealthiest clients as they start to make plans this year with the new federal tax rules in place. Link

* American Airlines swings to profit on tax benefit. Susan Carey and Tess Stynes – The Wall Street Journal. In the latest quarter, AMR Corp swung to a fourth-quarter profit after recording a positive one-time item of $350 million from an income-tax benefit. Link  

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

* Tax bite to climb from boom years. Josh Barnanel – The Wall Street Journal. While property values are slowly rising in New York, a quirk in the tax law will drive up property taxes by considerably more, including higher taxes on 69 homes damaged in superstorm Sandy, according to new city data. Link 

* Rep. Levin: Curb some tax breaks, keep others. John McKinnon – The Wall Street Journal. President Barack Obama’s proposed limit on tax deductions is the most likely model for raising revenues as part of a balanced approach to reducing deficits and averting the latest fiscal crisis, Rep. Sander Levin, the top Democrat on the House Ways and Means Committee, said Tuesday. Link  

* Wind industry’s roar may diminish in 2013. Ryan Tracy – The Wall Street Journal. The U.S. wind industry is planning new wind farms again after Congress renewed subsidies, giving idled factories that make turbines and components the prospect of a fresh set of orders in the second half of 2013. But industry officials say this year’s projects are unlikely to match the record number of megawatts installed in 2012. Link