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Internal Revenue Service federal building Washington DC USA

The Top Stories in Tax

Things never get boring in the world of tax. Tax preparers, tax practitioners and taxpayers may all have been hoping for a quiet 2014 after the tumult of 2013, but regulators and legislators weren’t complying.

Here are our editors’ picks for the most important stories of the year.

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Corporate Inversions

A corporate tax strategy most of us had never heard of made big news over the summer, brought into the spotlight by Burger King’s move to acquire Canada-based Tim Horton’s. The technique of acquiring a foreign company and then swapping the location of your corporate headquarters to avoid paying U.S. tax was promptly labeled unpatriotic by many, including President Obama, who blamed accountants for its use. Legislation was even proposed to punish corporate inverters, but surveys showed that businesses planned to continue using the strategy.
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Tax Reform Fizzles

Remember the big tax reform legislation of 2014? Neither do we. Although many hoped for it, and various senators and congressmen – including outgoing House Ways & Means Chair Dave Camp – proposed or promised to look into the subject, nothing much happened on this front.
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A Taxpayer Bill of Rights

It was no surprise that National Taxpayer Advocate Nina Olson recommended that the IRS adopt an official Taxpayer Bill of Rights in her January report; she has recommended it before. What was a surprise is that in June that IRS actually did it. As rights go, they’re not quite constitutional – but they’re better than nothing!
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Dark Wooden Gavel Abstract on Table with Room for Text.

The Final Chapter of Loving

In February, the IRS lost its appeal of 2013’s Loving ruling that had struck down its proposed (and partially enacted) tax preparer registration program. By the time the window for filing a further appeal closed in May, it was clear that the service didn’t intend to pursue the issue any further.
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Vintage inscription made by old typewriter, New life: Chapter 2

… Or Is it?

Rather than appeal Loving again, the IRS instead launched its strictly voluntary Annual Filing Season Program, a voluntary program where tax preparers who meet certain continuing education requirements can get listed in an entirely voluntary directory of qualified tax preparers. The American Institute of CPAs promptly launched a lawsuit against the voluntary program, but their suit was dismissed.

By the way, it’s voluntary.

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Lois Lerner, the director of the Internal Revenue Service's (IRS) exempt organizations office, listens during a House Oversight and Government Reform Committee hearing in Washington, D.C., U.S., on Wednesday, May 22, 2013. Lerner, the mid-level IRS official at the center of a controversy over treatment of small-government groups, invoked her right not to testify after reading a statement denying that she had committed any crimes. Photographer: Pete Marovich/Bloomberg *** Local Caption *** Lois Lerner

The IRS Scandal Continues

After exploding all over 2013, the IRS scandal surrounding targeting of conservative political groups for extra scrutiny was the gift that kept on giving, particularly surrounding the figure of Lois Lerner (pictured), who ran the group that engaged in the targeting. Congress continued to put pressure on the IRS to get to the heart of the matter, but ludicrous (and to some, suspicious) tech issues made it difficult of the IRS to produce Lerner’s e-mail correspondence from a crucial period for any sort of investigation.
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Prescription for healthcare reform and income tax form.

The ACA Looms Large

Few things about the Affordable Care Act are very clear, but one thing that has come into focus over the course of 2014 is that it’s going to play an enormous role in the upcoming tax season. With taxpayers in general unaware of their responsibilities, much of the burden will fall on their tax preparers.
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Businesspeople waiting

The Long Wait for Extenders

Despite constant warnings from IRS Commissioner John Koskinen, taxpayer groups and organizations representing tax preparers, Congress put off handling the annual crop of tax extenders until more or less the last minute. Everyone endured yet another year of uncertainty in tax policy until mid-December, when Congress retroactively reinstated the tax breaks -- for exactly two weeks, which means we get to go through the same thing next year.
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Internal Revenue Service federal building Washington DC USA

A Wounded IRS

Our choice for the biggest story in tax is the damaged state of the IRS. Whether it’s the ongoing scandal over targeting conservative groups, the final demise of the service’s tax preparer registration program, or its shrinking budget, it’s clear that the tax collection agency is going through a tough patch – and it’s not shy about letting everyone know, with Commissioner Koskinen warning anyone who will listen that the upcoming tax season will be difficult, since budget cuts will give it fewer resources to answer calls, process returns and otherwise fulfill its obligations.
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