Judging by a November survey of financial executives in Europe, there is considerable business community support for the European Commission’s (EC) June 2000 proposal to implement the IASC’s international accounting standards (IASs). The EC’s tentative plan to foster “comparable, transparent” reporting would, if approved by the European Union (EU), require
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TOPICS
Tax
New Wage Max for Social Security Payroll Tax
Source: Social Security Administration, www.ssa.gov .
Corporate Payment of Shareholder Expenses
The IRS closely scrutinizes all related party transactions. In addition to verifying that the items involved are stated at fair market value, it checks to make sure the transaction is properly classified. Recently, the Tax Court considered the correct classification of a corporation/shareholder transaction. Lenward Hood created Hood’s Institutional Foods
Let’s Get Personal
Source: Social Security Administration, www.ssa.gov .
The Engagement Team Approach to Independence
EXECUTIVE SUMMARY IN LIGHT OF FAST-MOVING CHANGES in society and business, the profession has responded by shifting from “firm-based” independence rules toward an approach that is “engagement team based.” THAT APPROACH IS INCLUDED in the SEC’s recently adopted rule 2-01 revisions. An exposure draft from the International Federation of Accountants
Form W-2 Gets Code for Stock Options
The IRS announced that employers will use a new code in box 12 of the 2001 form W-2. Box 12 states the amount of benefits includable as wages on which the employee’s share of taxes has been paid. Code V will identify the amount of compensation related to the exercise
Deducting Travel Expenses
In general, personal expenditures such as food and lodging are not tax deductible. However, a taxpayer may deduct these costs while he or she is away from home overnight for business purposes. Instead of deducting actual expenditures, taxpayers can use the per diem amounts for food and lodging in revenue
Companies Focus on Derivatives Compliance
BY THE NUMBERS Companies Focus on Derivatives Compliance FASB Statement no.133, Accounting for Derivative Instruments and Hedging Activities, issued in June 1998, requires that companies report their derivatives holdings at fair value and disclose the purpose and effectiveness of their hedging strategy. For most, the standard took effect January
The Tax Court’s Enhanced Power to Help Innocent Spouses
igning a joint return can be a bit like walking into a minefield. For example, a taxpayer, James, left preparation of their joint 2000 federal income tax return to his wife, Joanne. Unknown to him, Joanne had won $200,000 in a state lottery in May 2000, put the money in
International
IASC Provides Guidance on Financial Instruments In September the IASC issued guidance on the implementation of International Accounting Standard no. 39, Financial Instruments: Recognition and Measurement. IAS no. 39, which was released in March 1999 (see “IASC Puts Derivatives on the Balance Sheet” July99, JofA, page 20) , required
Estate Planning Strategies
iven the complexity of the Internal Revenue Code, many estate planning techniques can be used to lower (or eliminate) the tax burden over the course of an individual’s life. One method taxpayers can use is simply taking advantage of lifetime-giving opportunities through the annual exclusion amount, the applicable estate and
IRS Initiates Early Resolution Program for LMSB Issues
The IRS and the Treasury Department have launched a pilot program designed to address issues that are common to large or midsize business taxpayers. According to Larry Langdon, commissioner of the Large and Mid-Size Business (LMSB) Division, the aim of the industry issue resolution (IIR) program is to establish a
Spouses Can Challenge Innocent Spouse Relief Petitions
The Tax Court, in a case of first impression, has held that nonpetitioning or former spouses have the right to challenge innocent spouse relief petitions whenever their spouses or former spouses file them. The court directed the IRS to notify nonpetitioning and former spouses of their right to intervene in
Social Security Benefits Increased
The Social Security Administration (SSA) announced that Social Security and Supplemental Security Income (SSI) benefits will increase by 3.5% this year. These benefits go up automatically based on the rise in the Consumer Price Index for Urban Wage Earners and Clerical Workers from the third quarter of one year to
International
IFAC Issues Bank Audit ED and Cost Accounting Study The International Federation of Accountants is seeking responses to a proposed international auditing statement that will provide practical assistance to auditors in applying international standards when they audit commercial banks. Special considerations arise in bank audits because of the nature
Bracing for the Boomers
Source: Social Security Administration, www.ssa.gov.
How to Be Careful and Still Be Clear
EXECUTIVE SUMMARY IN AN EFFORT TO SIDESTEP POTENTIAL LIABILITY, CPAs may obscure rather than clarify important information presented to clients. The types of documents least affected by professional standards are the ones that are most important for practice development. A CPA WHO SPEAKS AND WRITES PLAIN ENGLISH develops a reputation
Status of Medical Residents
edical (and other health care) residency programs are a staple of education and training in the United States. Once a person has graduated from medical school and passed a licensing exam, he or she is eligible to participate in a program run by a sponsoring or participating institution as a
Day Trading and Self-Employment Taxes
In the October 2000 issue of the JofA, t wo tax articles discussed day traders and day trading. One, “Being a Trader in Securities”(page 118), was an excerpt from a longer Tax Adviser article, “Securities Trader Reporting Requirements,” by Thomas Rolfe Pudner. It said a “trader’s activity is not subject
IRS Reorganization: The Effect on Practitioners This Tax Season and Beyond
When I became Commissioner of Internal Revenue in 1997 I pledged to turn the IRS into an organization that would consistently deliver the highest quality service to America’s taxpayers. The IRS must measure its success or failure not only by the taxes it collects but also by its effect on
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From The Tax Adviser
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Current developments in taxation of individuals: Part 2
April 30, 2026
