The answer would be “yes” for the majority of adult consumers who complete financial education programs. Gallup polled consumers six to 12 months after finishing the Federal Deposit Insurance Corp.’s Money Smart course, which focuses on money management, banking skills and basic financial services education. A majority of participants reported
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TOPICS
Personal financial planning
Tax Patents Considered
EXECUTIVE SUMMARY The U.S. Patent and Trademark Office since 1998 has granted patents to business methods. In recent years, these patents have come to include strategies to minimize tax, a development many observers find troubling. Tax strategy patents complicate tax advising, return preparation and compliance, since
Gender Gap in Financial Preparedness
The latest Retirement Fitness Survey reported about six out of 10 women felt worried (58%) and uncertain (61%) about planning financially for retirement. Married women appeared less prepared than their unmarried counterparts, with 39% vs. 27% not knowing how much they had saved for retirement (20% of married men and
Practice Makes Perfect
Tax practitioners have enough concerns without having to fear the specter of a professional liability claim resulting from a preventable mistake or oversight. Many of these slip-ups can be prevented by simply jotting a contemporaneous note recording the rationale for an election or flagging a filing deadline
The Dreaded Kiddie Tax
EXECUTIVE SUMMARY Since 1987, taxpayers wanting to shift income to children subject to lower tax rates had to consider the kiddie tax when the children were under 14 years old. TIPRA, which became law in May 2006, made a significant change in the kiddie tax retroactive
AICPA Criticizes Tax Patents
Congress should restrict patents on tax strategies or protect taxpayers and preparers from infringement actions arising from them, the AICPA told members of congressional committees. In letters to the House and Senate tax-writing and judiciary committees and a white paper, the AICPA said one government agency—the U.S. Patent and Trademark
Time to Rethink Your 401(k) Plan?
EXECUTIVE SUMMARY The PPA has made it easier for plan sponsors to automatically enroll employees in a retirement plan by eliminating the worry over state withholding laws. It delineates a new safe harbor automatic enrollment provision that starts the automatic deferral at 3%, raising it by
Dirty Little Secrets of 401(k) Plan Fees
In September 2006, eight Fortune 500 companies were named in class action lawsuits alleging they failed to monitor and disclose 401(k) fees under so-called revenue-sharing arrangements. To protect your company or client, watch for these red flags when reviewing a 401(k) plan offering: Determine how expenses in
Taking Stock of ESPPs
EXECUTIVE SUMMARY Employees of corporations with an employee stock purchase plan (ESPP) often fail to participate fully in the plan because they don’t understand why it can be a good deal. Many plans offer a purchase discount of as much as 15%. Effectively, the discount can
Highlights
HIGHLIGHTS With FASB affirming its implementation date for FIN 48, several organizations, including the AICPA and FASB itself, are producing educational materials or additional guidance to help issuers comply with its new requirements for recognizing and measuring tax assets and liabilities. FASB Interpretation no. 48, Accounting for
The Choice-of-Entity Maze
EXECUTIVE SUMMARY When advising clients on the choice of business entity, CPAs should consider the advantages and disadvantages of each type. If more than one entity is involved, CPAs should also determine whether clients can deal with the complexity of the resulting structure. The many issues
Choose the Right Health Care Account
EXECUTIVE SUMMARY Health spending accounts offer opportunities for employees to save and pay for health care with pretax contributions. Three basic types are flexible spending arrangements (FSAs), health reimbursement arrangements (HRAs) and health savings accounts (HSAs). FSAs are typically funded by pretax payroll deduction and are
Highlights
The PCAOB proposed a standard, An Audit of Internal Control Over Financial Reporting That Is Integrated With an Audit of Financial Statements, to replace PCAOB Audit Standard no. 2 (AS2). The proposal is designed to focus audits on the matters most significant to internal control, eliminate unnecessary
To Roth or Not to Roth?
EXECUTIVE SUMMARY Companies took a wait-and-see attitude toward the Roth 401(k) in the plan’s first year, but researchers say 2007 is nearly certain to see rapid growth in participation by companies and enrollment by employees. CPAs can help workers decide between a traditional and a Roth
Highlights
HIGHLIGHTS The SEC enhanced the Internet-based search capability of its EDGAR database of company filings. Users now can search the contents of disclosure documents with a full-text search tool. The newly searchable information includes registration statements, annual and quarterly reports and other filings by companies and
Worries About Inflation
The United States has enjoyed a long period of relatively tame inflation and either steady or declining interest rates. This environment has lent itself well to investing in equities and predictable returns in debt securities for conservative or income-oriented investors. Recently, however, disturbing signs that more aggressive inflation may be
Home Free
EXECUTIVE SUMMARY Many home sellers have seen rapid appreciation of their home’s value in recent years, leaving them vulnerable to capital gains beyond the principal-residence exclusion under IRC section 121of $250,000 for an individual or $500,000 for joint filers. If sellers buy another home, however, they may be able to
A Glimpse of the Future
With their years of schooling behind them, most Americans between the ages of 25 and 34 spend their time thinking of their new careers, their first homes, their children on the way. But while this group of young people is among the richest in history, its overall
TIPS and CIPS
EXECUTIVE SUMMARY TIPS are a relatively new form of bond from the federal government that offer protection against the risk of inflation. They combine a high degree of safety of the principal with a hedge against inflation. Potential investors in TIPS may bid for them at auction in either
Rating 529 College Savings Plans
EXECUTIVE SUMMARY Section 529 college savings plans offer numerous advantages and have few disadvantages compared with other options. Their benefits include tax savings, estate planning benefits, high contribution limits and no income limitations. One of the few drawbacks to these plans is that investment products usually are chosen by
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FROM THIS MONTH'S ISSUE
Making the right choice when no one is watching
The true test of one’s character is the decision made when no one is looking over your shoulder. Learn how CPAs can uphold ethical standards and take actions that help limit liability risk.
From The Tax Adviser
April 30, 2026
Current developments in taxation of individuals: Part 2
April 30, 2026
