Unstructured Finance

Essential reading: FATCA hurts Americans abroad, and more

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

 * Americans living abroad say U.S. tax laws punishing them. Margaret Collins and Richard Rubin – Bloomberg news. Complexity has increased for Americans abroad with the Foreign Account Tax Compliance Act, enacted in 2010 to combat tax evasion by US taxpayers with assets offshore. Link    

* It takes 2 votes, but Minnesota Senate approves $1.8 billion tax bill. Baird Helgeson and Jennifer Brooks – The Star Tribune. The Minnesota Senate approved $1.8 billion in tax increases on a second try Monday, but only after salvaging the measure amid an embarrassing political defeat for Democratic leaders. Link    

* France’s Hollande plans tax changes to woo investment. William Horobin and Sam Schechner – The Wall Street Journal. French President François Hollande called a broad sweep of business leaders at the Elysee Palace Monday to offer them a break on the capital gains tax and pitch new proposals for encouraging entrepreneurship in a country desperate for growth. Link    

* Great tax race: Luxembourg set to share companies’ bank details. James Fontanella-Khan – The Financial Times. Luxembourg is ready to share currently confidential information about multinationals’ bank accounts as part of efforts to shed the Grand Duchy’s image as a leading tax haven. Link 

* Debt and Growth. The Wall Street Journal editorial. Perhaps you’ve read that America’s debt burden is no longer a problem. The crucial issue isn’t merely the level of debt, the important matter is what that additional debt is buying. Link    


Some important tax and accounting events in the week ahead:

Monday, April 29 – Friday, May 3

* Tax Executives Institute federal taxation course. East Lansing, Michigan.

Tuesday, April 30

* D.C. Bar Association session on the taxation of financial derivatives. 12 noon – 1:30 p.m., D.C. Bar Conference Center. Washington.

Tuesday, April 30 – Thursday, May 2

* Experts from the Internal Revenue Service, the Treasury Department and private industry address the Practicing Law Institute conference on tax planning for domestic and foreign partnerships. Chicago, New York, San Francisco and by webcast.

Wednesday, May 1

* Financial Accounting Standards Board meeting on EITF accounting issues. 8:30 a.m., FASB offices. Norwalk, Connecticut.

Essential reading: Republicans pursue tax reform, and more

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

* GOP moves away from entitlements and toward tax reform in budget deal. Lori Montgomery – The Washington Post. With another fight over the national debt brewing this summer, congressional Republicans are de-emphasizing their demand for politically painful cuts to retirement programs and focusing on a more popular prize: a thorough rewrite of the U.S. tax code. Link  

* Push to require online sales tax divides the GOP. Jonathan Weisman – The New York Times. Legislation that would force Internet retailers to collect sales taxes from their customers has put antitax and small-government activists like Grover Norquist’s Americans for Tax Reform and the Heritage Foundation in an unusual position: they’re losing. Link   

* Hybrid drivers may save on gas but new tax gotchya. Jayne O’Donnell – USA Today. Virginia Gov. Bob McDonnell, a Republican, signed a new law last month that lowers the gas tax for everyone, but slaps a $64-per-year fee on hybrid and electric car owners. Link    

Essential reading: Obama talks budget with Republicans, and more

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

* Obama officials hold early budget talks with Republicans. Jackie Calmes – The New York Times.  The meeting on Thursday was an early step in a long process, with an end goal of both raising tax revenues and curbing the growth of spending for Medicare and other entitlement benefit programs. Link

* U.S. official: Transfer pricing enforcement should precede new rules. Emily Chasan – The Wall Street Journal. Governments should focus on enforcing laws already the books that govern the way large multinational companies move profits between high and low tax countries before writing new legislation, a U.S. Treasury tax official said Thursday. Link

* Carbon tax on the table in the Senate. Stephen Stromberg – The Washington Post. On Thursday, the Senate Finance Committee released a package of ideas that would involve reforming the tax code for infrastructure, energy and natural resources. Link

Essential reading: UK’s Cameron fights tax evasion, and more

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

 * UK premier David Cameron presses EU on tax evaders. Vanessa Houlder and George Parker – The Financial Times. David Cameron on Wednesday urged European leaders to be in the vanguard of a global effort to crack down on aggressive tax avoidance and evasion, as he tries to build momentum before the G8 summit in Northern Ireland in June. Link    

* States push to get the most out of marijuana taxes. Dan Frosch – The New York Times. If marijuana is legalized and properly regulated, its proponents have long said, it could generate millions of dollars in state tax revenue. But how the drug should be taxed has proved to be a thorny question. Link    

* Housing industry defends US tax breaks. James Politi – The Financial Times. The US housing industry will warn lawmakers not to curb the tax deduction on mortgage interest as they grapple with ways to reform the US tax code and reduce America’s budget deficits. Link    

Essential reading: Congress looks at REIT tax exemption, and more

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

* Congress looks at REIT tax exemption. A.D. Pruitt – The Wall Street Journal. A powerful congressional committee is examining the tax exemption that real-estate investment trusts have enjoyed for decades as part of its comprehensive review of the tax code. Link    

* Backers and opponents of online sales tax ramp up lobbying. John McKinnon – The Wall Street Journal. Both sides in the online sales tax debate were ramping up lobbying efforts and forming new alliances Tuesday in hopes of swaying a coming Senate vote on a bill that would effectively end tax-free Internet shopping in most states. Link 

* IRS issued billions in improper refunds, report says. Josh Hicks – The Washington Post. The Internal Revenue Service issued more than $11 billion in improper payments through its Earned Income Tax Credit program last year, according to an inspector general’s report released this week. Link 

Essential reading: Obama budget taxes more Americans, and more

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

* Analysis of Obama’s budget finds a higher tax burden for most Americans. Zachary Goldfarb – The Washington Post. President Obama’s budget would raise taxes mainly on people earning more than $200,000 a year, although earners at nearly every income level would face a somewhat higher tax burden, according to a new nonpartisan analysis. Link

* The incredible shrinking budget deficit. Annie Lowrey – The New York Times. The growing economy is bolstering tax revenue and reducing the need for spending on programs like unemployment insurance. Link

* Hasbro weighing repatriation tax strategies. Maxwell Murphy – The Wall Street Journal. Hasbro Inc. is evaluating tax-efficient repatriation options for its $1.1 billion in overseas cash, executives said on a Monday conference call to discuss the toymaker’s first-quarter results. Link

Essential reading: Businesses become REITs to avoid taxes, and more

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

* Restyled as real estate trusts, varied businesses avoid taxes. Nathaniel Popper – The New York Times. A small but growing number of American corporations, operating in businesses as diverse as private prisons, billboards and casinos, are making an aggressive move to reduce — or even eliminate — their federal tax bills. Link    

*  European FTT could cost U.S. funds ‘up to $35 billion.’ Mark Cobley – The Wall Street Journal. Europe’s proposed levy on financial transactions could cost U.S. money market funds up to $35bn, according to the first quantitative analysis of the impact of the tax on the U.S. funds industry. Link    

* Survey: Economists say higher taxes, lower government spending not affecting businesses. The Associated Press. The National Association for Business Economics survey asks how higher taxes and lower government spending effected businesses in the first three months of 2013. Link    

Cleveland Fed leads in measuring stress

By Matthew Goldstein

 When you think of Cleveland, finance isn’t the first thing that comes to mind.

 If you’re old enough or a rock-and-roll historian, you might say DJ Alan Freed (and i don’t mean DJ as in electronic dance music).1 Or maybe, the old adage  “mistake by the Lake” comes to mind.

But the Cleveland Fed is breaking some new ground with its new and improved financial stress index. In time, I wouldn’t be surprised if the Cleveland Financial Stress Index becomes a regular go to index for traders–especially macro and volatility types. And it probably won’t be long before someone is modeling some algo to track the CFSI performance if it hasn’t already been done.


Some important events in the week ahead:

 Monday, April 22

* New York University program on the future of pass-through entity taxation. 12:30 – 1:30 p.m. ET, Furman Hall, NYU. New York.

 Tuesday, April 23

* Internal Revenue Service hearing on proposed regulations providing guidance on large employers’ health insurance coverage responsibilities. 10 a.m. ET, IRS Auditorium. Washington.

* Cory A. Johnson, Senior Litigation Counsel, U.S. DOJ Tax Division is a panelist discussing tax cases at the Court of Federal Claims Barr Association lunch. Noon, offices of Caplin & Drysdale. Washington.