FASB Chairman Leslie Seidman will discuss the board’s priorities for 2012 on Monday, and FASB and the International Accounting Standards Board (IASB) are gathering to discuss proposed standards updates for investment companies and real estate investment property next Friday. Also, several key reports will gauge U.S. consumer confidence. Here’s a
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PCAOB reopens comment period on audit firm rotation concept release
The PCAOB has reopened its comment period regarding a debated concept release on auditor independence and audit firm rotation. The original comment period closed Dec. 14. The new deadline is April 22, the PCAOB said Wednesday. The board extended the deadline to incorporate comments following a March 21–22 public meeting
IRS expands “Fresh Start” initiative, provides penalty relief for unemployed
The IRS announced an expanded “Fresh Start” initiative Wednesday to help struggling taxpayers with a number of measures for relief (IR-2012-31). One of the most noteworthy of these measures is the abatement for the 2011 tax year of the failure-to-pay penalty (0.5% per month of the tax due up to
CEO of FASB’s parent foundation says Senate bill would undermine standard setting
Financial Accounting Foundation President and CEO Terri Polley told a Senate committee on Tuesday that a provision in the so-called Schumer-Toomey bill, “raises serious issues about the continued independence of the standard-setting process.” The proposal is designed to decrease the administrative burden on small and medium companies and spark job
Tax Court says limitation on deductible mortgage interest applies to unmarried co-owners
On Monday, the Tax Court held that unmarried co-owners were together subject to the $1.1 million limit on personal residence indebtedness under Sec. 163(h)(3) (Sophy, 138 T.C. No. 8 (3/5/12)). The taxpayers had argued that, for unmarried taxpayers, each owner should be subject to a separate limit, even though married
2012 automobile depreciation limits released
The IRS on Friday issued the 2012 inflation adjustments to the depreciation limitations and lease inclusion amounts for certain automobiles under Sec. 280F (Rev. Proc. 2012-23). For passenger automobiles (other than trucks or vans) placed in service during calendar year 2012 to which 50% first-year bonus depreciation applies, the depreciation
COSO explores common judgment traps, lays out five-step decision-making process
Many faulty business decisions can be traced to “confirmation bias” that leads people to unwittingly seek information that bolsters what they want to believe, says Brigham Young University accounting professor Doug Prawitt. “We don’t realize it when we do that, but it’s a very, very powerful human bias,” he said
IRS regulations broaden disclosures of tax-exemption determinations
In response to the D.C. Circuit’s holding that the regulations the IRS had relied on to not disclose rulings denying or revoking organizations’ tax-exempt status violated the disclosure provisions of Sec. 6110 (Tax Analysts, 350 F.3d 100 (D.C. Cir. 2003)), the IRS has issued final regulations amending the earlier regulations
Correspondence audits need some work, tax community tells IRS
The IRS’ use of correspondence audits to resolve issues with tax returns has mushroomed over the past decade—but taxpayer satisfaction with the program is fairly low. According to the Treasury Inspector General for Tax Administration (TIGTA), only 48% of those surveyed by the IRS said they were either somewhat or
PCAOB outlines related parties proposal, other amendments
The PCAOB on Tuesday issued for public comment a proposed auditing standard on related parties and proposed amendments on significant unusual transactions. The board said the proposals are designed to improve auditors’ focus on certain areas of risk. In addition, the PCAOB proposed amendments to its rules and forms to
SEC proposes identity theft “red flags” rules to protect investors
Broker-dealers, mutual funds and other SEC-regulated entities would be required to create programs to detect and respond appropriately to identity theft red flags under an SEC rules proposal announced Tuesday and issued for public comment. The proposed rules are designed to protect investors from identity theft and are similar to
FinCEN postpones mandatory FBAR e-filing
The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) announced that it is postponing until July 1, 2013, its requirement that Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR), be filed electronically. FinCEN notes that the delay in the e-filing requirement does not relieve anyone of the
Eighth Circuit affirms S corporation shareholder’s compensation was not reasonable
The Eighth Circuit affirmed the District Court for the Southern District of Iowa’s decision that an S corporation shareholder’s $24,000 salary was not reasonable compensation and that the $91,044 salary determined by the government’s expert witness was (David E. Watson, P.C., No. 11-1589 (8th Cir. 2/21/12)). At issue is a
FinREC seeks clarity in principal vs. agent proposal
The AICPA’s Financial Reporting Executive Committee (FinREC) sent a comment letter to FASB stating concerns about operational challenges that could be triggered by Proposed Accounting Standards Update (ASU), Consolidation (Topic 810)—Principal Versus Agent Analysis. FASB issued the Proposed ASU on Nov. 3. The proposal would amend the evaluation of kick-out
President signs payroll tax cut extension bill; new Form 941 released
On Wednesday evening at the White House, President Barack Obama signed into law the Middle Class Tax Relief and Job Creation Act of 2012, H.R. 3630. On Thursday, the IRS released a revised Form 941, Employer’s Quarterly Federal Tax Return, to reflect the extended payroll tax cut. The act extends
Supreme Court: Filing a false tax return can lead to deportation
The U.S. Supreme Court issued a decision Tuesday holding that a conviction under Sec. 7206 for willfully filing a false tax return (or for aiding and abetting filing a false tax return) is an aggravated felony that can result in deportation. Kawashima v. Holder, S. Ct. Dkt. No. 10-577 (U.S.
Budget proposal includes change to treatment of intentionally defective trusts
Among the various estate tax proposals in President Barack Obama’s recently released fiscal year 2013 revenue proposals is a new plan that could alter estate planning techniques and benefits with intentionally defective grantor trusts (IDGTs); the assets in these trusts would be included in the estate of the grantor at
IFRS decision a “few” months away, based on SEC staff report timeline
An SEC decision on the use of IFRS by U.S. public companies is still a “few” months away, SEC Chief Accountant James Kroeker indicated Monday. At an IFRS Advisory Council meeting in London, Kroeker declined to get more precise because he wants the SEC staff focused on completing a report
Congress passes payroll tax cut extension
On Friday, the House of Representatives and the Senate both passed a bill that will extend the reduced 4.2% Social Security tax rate through the end of the year (The Middle Class Tax Relief and Job Creation Act of 2012, H.R. 3630). The vote was 293–132 in the House and
Round table explores investment company proposals
Questions arose about the scope and substance of accounting standards proposals on investment companies Friday during a round-table meeting sponsored by FASB and the International Accounting Standards Board (IASB). The meeting, which was held in Toronto, was the first of four public meetings to discuss the FASB and IASB proposals.
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