CalCPA BUZZ
Keeping CalCPA Members Connected and Informed
Contributed by CalCPA
More than 30 members of the U.S. House of Representatives sent a bipartisan letter to Treasury Secretary Timothy F. Geithner urging changes in the IRS’s proposed plan to regulate paid income tax return preparers. The House lawmakers are asking the Treasury and IRS to exempt non-signing tax preparers—employees of CPA firms who prepare returns but do not sign them—from onerous registration requirements. Lawmakers are also asking for a delay and more study of an IRS proposal to create a nationwide examination of tax preparers.
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Contributed by CalCPA
The Offer in Compromise Program allows taxpayers who do not have, and will not have in the foreseeable future, the money, assets or means to pay their tax liability in full to offer a lesser amount for complete satisfaction of a non-disputed final tax liability. The FTB’s OIC program is authorized by RTC Sec. 19443.
You may use the following publications to assist your clients in applying for an OIC:
- 4905 PIT Booklet, Offer in Compromise for Individuals.
- 4905 BCT Booklet, Offer in Compromise for Business Entities.
- DE 999CA, Multi-Agency Form for Offer in Compromise.
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Contributed by CalCPA
Despite the still-shifting sands beneath today’s troubled economy, 40 percent of survey respondents are “optimistic” or “very optimistic” about the U.S. economic outlook for the next 12 months. This finding is a marked improvement, up from 25 percent for the first quarter of 2010 and the record-low of five percent for the first quarter of 2009.
The news is even more positive for survey participants’ prospects for their own organizations over the next 12 months—45 percent are “optimistic” and six percent are “very optimistic.” This is the first time in more than two years that more than half of CPA executives surveyed were optimistic about the economic outlook for their organizations. Additionally, eight percent expect business to “expand a lot,” more than 48 percent expect business to “expand a little” and 26 percent expect it to “stay the same” for the next 12 months.
See more results from the survey.
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Contributed by CalCPA
According to the IRS:
- The largest share of the income tax burden (29 percent) is borne by filers between the age of 45 and 55.
- The next largest share (23 percent) is borne by tax filers between the ages of 55 and 65.
- Taxpayers under the age of 35 bear just 11 percent of the total burden.
- Taxpayers over the age of 65 pay 16 percent of the total burden.
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Contributed by CalCPA
The IRS will no longer provide tax preparers and associated financial institutions with the “debt indicator,” which is used to facilitate refund anticipation loans, starting with next year’s tax filing season. Currently, tax preparers who electronically submit a client’s tax return receive in the acknowledgment file an indication of whether an individual taxpayer will have any portion of the refund offset for delinquent tax or other debts, such as unpaid child support or delinquent federally funded student loans. This acknowledgment is known as the debt indicator and is used as an underwriting tool for refund anticipation loans.
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Contributed by CalCPA
The Prince of Wales’ Accounting for Sustainability Project and the Global Reporting Initiative have formed the International Integrated Reporting Committee (IIRC). The IIRC’s goal is to create a globally accepted framework for accounting for sustainability: a framework that brings together financial, environmental, social and governance information in a clear, concise, consistent and comparable format. The intention is to help with the development of more comprehensive and comprehensible information about an organization’s total performance—prospective as well as retrospective—to meet the needs of the emerging, more sustainable, global economic model.
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Contributed by CalCPA
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Contributed by CalCPA
The IRS is proposing a new set of tax preparer regulations that will change who will be allowed to prepare and file taxes. The first step in the process—expanding use of the preparer tax identification number (PTIN) system—starts next month with open registration. Upcoming requirements include:
- All paid tax return preparers must sign up with the IRS, pay a registration fee and obtain a preparer tax identification number. If you already have a PTIN, you must still signup under the new process.
- Competency tests for all paid tax return preparers except CPAs, attorneys and enrolled agents who are active and in good standing with their respective licensing agencies.
- Continuing professional education of 15 hours per year for all paid tax return preparers except CPAs, attorneys and enrolled agents.
- Tax compliance checks on all tax return preparers.
- Extending Circular 230 ethics standards to all preparers.
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Contributed by CalCPA
Strong leaders in strategic positions are key to CalCPA’s continued success. CalCPA Leadership Institute is a five-day program designed to teach members skills that will make them better leaders and managers. Apply today. Application deadline is Sept. 1.
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Contributed by CalCPA
For taxable years beginning Jan. 1, 2009, California requires individual taxpayers with California AGI equal to or greater than $1 million ($500,000 for married/RDP filing separately) to pay 90 percent of the current year tax or be subject to the underpayment of estimated tax penalty (see notice FTB 5805).
However, FTB systems did not allow the $500/$250 tax liability prior year exception for a 2009 tax year return reporting an AGI equal to or greater than $1 million ($500,000 for married/RDP filing separately). As a result, notices with incorrect penalties were sent out.
The FTB says the processing error was corrected and the affected 2009 tax returns were identified and corrected. FTB 719PC, Underpayment of Estimate Tax Penalty, was sent to taxpayers regarding the adjustment beginning July 26, 2010. If applicable, refunds will be mailed within two weeks.
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