A taxpayer who consistently lost money playing the slots at two casinos in California was found not to have an actual and honest profit objective and could not deduct her gambling losses on Schedule C, Profit or Loss From Business (Sole Proprietor) (Chow, T.C. Memo. 2014-49). Because losses from gambling
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Six cybersecurity basics
The steady barrage of headlines about cybersecurity underscores a topic viewed with wary eyes by many executives, board members, and investors. Employees may have access to sensitive data through smartphones that they carry everywhere. Globalization has increased the geographic reach of companies – making them visible to ever more hackers.
New guidance clarifies tax treatment of bitcoin and other virtual currencies
While bitcoin and other virtual currencies are becoming more popular and have garnered a lot of attention in the media, the tax rules that apply to them have been unclear, including the basic question of whether they are treated as a currency or as property. The IRS on Tuesday issued
Regulation demanding increased internal audit focus
The push continues for internal auditors to focus on strategic risks, but regulatory compliance duties are standing in the way, a new survey shows. More than two-thirds (69%) of 433 internal audit professionals in the United States surveyed by Grant Thornton said regulation is increasing internal audit costs in their
The Supreme Court rules severance payments are subject to FICA
In a decision involving over $1 million in FICA taxes paid, the Supreme Court on Tuesday held in an 8–0 decision that severance payments to terminated employees are taxable wages for FICA tax purposes (Quality Stores, Inc., No. 12-1408 (U.S. 3/25/14)). Justice Anthony Kennedy’s opinion overturned a decision of the
IASB proposal designed to improve disclosures
Amendments proposed by the International Accounting Standards Board (IASB) on Tuesday are designed to play a role in the board’s effort to reduce disclosure overload. Proposed amendments to IAS 1, Presentation of Financial Statements, are the result of one of several short-term projects under the IASB’s broader Disclosure Initiative. The
Auditors have important role in cybersecurity
The steady stream of headlines about data breaches has the business community and regulators on high alert with regard to cybersecurity. An online PwC survey of global executives and IT directors conducted early in 2013 found that detected cybersecurity incidents rose 25% over the previous year. And 31% of executives
Pension standard remains on schedule after GASB vote
GASB’s new standard governing financial reporting for state and local government pensions will be implemented as scheduled after the board voted unanimously Monday not to delay the implementation date. As a result of the vote, the requirements of Statement No. 68, Accounting and Financial Reporting for Pensions, will still go
Conflict minerals audit guidance available
With the May 31 deadline approaching for companies to file their first conflict minerals reports with the SEC, new guidance is available to practitioners as they perform the required independent private-sector audits of these reports. Examples of practitioners’ reports are illustrated in new questions and answers developed by the AICPA
IRS clarifies: Electronic signatures permitted for Form 8879
Correcting an oversight, the IRS on Thursday updated the online version of Publication 1345, Handbook for Authorized IRS e-File Providers of Individual Income Tax Returns (rev. 3/20/14), to clarify that electronic signatures are permitted for Form 8879, IRS e-File Signature Authorization, as well as Form 8878, IRS e-file Signature Authorization
Stop using “audit failure” term in PCAOB reports, Hanson says
The PCAOB’s use of the term “audit failure” in its inspection reports of audit firms appears to have caused confusion and misunderstanding about the severity of inspection findings among investors, audit committees, and others, PCAOB member Jay Hanson said Wednesday. Hanson said he is troubled by the PCAOB’s use of
FASB issues private company VIE alternative
A GAAP alternative issued by FASB on Thursday will allow a private company to elect—under certain circumstances—not to consolidate variable-interest entities (VIEs) in common-control leasing arrangements. The exemption, described in FASB Accounting Standards Update No. 2014-07, Applying Variable Interest Entities Guidance to Common Control Leasing Arrangements, is the third GAAP
IRA rollover guidance issued: IRS will follow the Tax Court
To settle the question of whether the limitation on rolling over one IRA per year under Sec. 408(d)(3)(B) applies to taxpayers on an aggregate basis or on an IRA-by-IRA basis, the IRS announced it will follow the Tax Court’s recent decision in Bobrow, T.C. Memo. 2014-21, applying the rule on
Internal auditors racing to keep pace with technology
Internal auditors have a strong desire to know more about emerging technologies and improve the way they use technology to perform their duties, a new survey shows. Mobile applications and social media are among the top areas of technical knowledge that internal auditors most need to improve, according to a
Boards remain split on lease expense recognition
FASB and the International Accounting Standards Board (IASB) failed to reach a consensus for new lease accounting guidance Wednesday but vowed to continue working together in pursuit of consistency. During two days of meetings at FASB’s headquarters in Norwalk, Conn., the boards failed to reach common answers on key areas
No easy answers in key leases standard debate
FASB and the International Accounting Standards Board (IASB) are struggling to find common ground in their efforts to create a converged standard for financial reporting on leases. While meeting together Tuesday at FASB’s headquarters in Norwalk, Conn., the two boards came to different conclusions in preliminary votes on financial reporting
11 issues that could flare up at the next shareholder meeting
U.S. public companies are operating in an environment full of both risk and opportunity as they prepare for their annual shareholder meetings. Cyberthreats, disaster planning, and political and economic unrest are among many factors that make the current climate hazardous for many companies. Although high values in the stock market
IRS expands use of electronic signatures
With the updated version of IRS Publication 1345, Handbook for Authorized IRS e-File Providers of Individual Income Tax Returns (rev. 3/11/14), the IRS provides new methods for taxpayers to electronically sign Form 8878, IRS e-file Signature Authorization for Form 4868 and Form 2350, the e-file signature authorization form. Taxpayers can
Regulatory issues requiring more attention from some CFOs
Managing regulatory compliance has become a more arduous task in the past 12 months for one-fifth of U.S. CFOs, a new survey shows. In the aftermath of the financial crisis, new regulations have been added through legislation such as the Dodd-Frank Wall Street Reform and Consumer Protection Act, P.L. 111-203,
New procedure permits automatic recognition of consolidated return filing status
The IRS announced that it will permit an affiliated group of corporations that did not file the required Form 1122, Authorization and Consent of Subsidiary Corporation to Be Included in a Consolidated Income Tax Return, for all of its subsidiaries, to be treated as if its subsidiaries had filed Form
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