Practice Management

Sen. Chuck Grassley, R-Iowa, ranking member of the Senate Finance Committee, has sent a letter to his chamber colleagues in an attempt to blunt what he termed "inaccurate claims" about the private collectors employed by the Internal Revenue Service. In a "Dear Colleague" letter, Grassley pointed out that the IRS's own collection infrastructure is better set up for placing liens and garnishing wages than making initial phone calls to delinquent taxpayers to set up a payment plan. Grassley wrote that the private debt collection program consists of having contractors make basic phone calls to taxpayers, contrary to the images of thuggish collection agents using questionable tactics, as has been portrayed by opponents of the program. As evidence, he said that of 24,000 cases of collection just 36 inquiries have been registered. Grassley said there is roughly $90 billion in unpaid taxes that is languishing instead of being collected. His letter said that some of that money is best collected by the "tough cops" of the IRS, fully empowered to seize property, garnish wages, freeze bank accounts and sell the family home or business. However, a large percentage, typically the smaller, newer debts, is better obtained by a modern outbound calling system -- a system that the IRS currently doesn't have, nor are its employees trained for it.

I’m a sucker for financial calculators -- you know, those little widgets that help you find out how much you’ll pay monthly on your 30-year mortgage, how long it’ll take to pay off your student loans, or what you can save when you switch your balances to a new credit card.So it was with some interest that I came across a little application last week, courtesy of journalist Kay Bell’s “Don’t Mess with Taxes” blog (http://dontmesswithtaxes.typepad.com), that allows users to calculate what their income tax liability would have been under the original Form 1040 -- issued in1913. (The calculator can be accessed directly at http://politicalcalculations.blogspot.com/2007/04/income-tax-original-form-1040.html).

Liberty Tax Service reported a 20 percent increase in the number of tax returns prepared at its franchises for the 2007 fiscal year.

According to Vertex Inc.’s annual Sales Tax Rate Report, the average number of U.S. sales tax rate changes per year has grown by 28 percent since the late 1990s.Based on a comparison of the number of state, county, city and district sales tax rate changes during the six-year periods between 1995 and 2000, and 2001 and 2006, the study found that the average number of rate changes per year was 610 and 779, respectively. According to the report, the number of rate changes decreased for the earlier period, while the number of yearly rate changes fluctuated for the later period.

At first glance, the recent testimony of Treasury Secretary Henry Paulson, Jr. before the Senate Finance Committee on ways to reduce the tax gap was fairly typical, in that he urged Congress to approve the Presidential-submitted budget with increased IRS funding, and to pass 16 legislative proposals aimed at narrowing the tax gap.

Global business intelligence software provider Business Objects S.A., provider of the Crystal Reports series, has agreed to acquire enterprise software publisher Cartesis for about $300 million in cash.

The leaders of the Senate Finance and the House Ways and Means Committees have reached agreement on a tax package aimed at providing nearly $5 billion in tax relief for small businesses.

AccountAbilities Inc., a provider of financial personnel staffing services, marketing services and management consulting services, announced that one of its partner firms has acquired a smaller staffing and consulting firm.

Eide Bailly LLP, North Dakota’s largest accounting firm, announced that it will merge with Sioux Falls, S.D.-based Henry Scholten & Co. LLP.

As expected, H&R Block Inc. announced that it has signed an agreement to sell its struggling Option One Mortgage Corp. lending arm, though unit subsidiary H&R Block Mortgage Corp. is not part of the deal.