Practice Management

Individuals who owe delinquent federal income taxes will now be able to apply online for a payment agreement, the Internal Revenue Service announced.

The tax prep software industry is both expanding and contracting, as Wolters Kluwer and Thomson continue their acquisitions, while new entrants surface with online and application service provider offerings.Thomson's Creative Solutions purchased Dunphy Systems in May, with the intention of converting existing Dunphy customers to Creative Solutions. CCH, on the other hand, announced its acquisition of Rockville, Md.-based ATX/Kleinrock in August, but will keep it as a distinct product line. CCH followed this move with an announcement in September that it would acquire Rome, Ga.-based TaxWise. It likewise will keep TaxWise as a separate product line, according to CCH president and chief executive Kevin Robert.

Carpathia Corp., a provider of accounting consulting, staffing and executive search and placement, announced its investment in a trio of California-based accounting services firms - Irvine's Corporate DNA, Walnut Creek's The Nolan Group, and San Francisco's A4C. Financial terms of the deal were not disclosed.The move into metropolitan Los Angeles and San Francisco is Carpathia's first foray outside its home base in the Philadelphia area.

SURVEYED TACS ARE RIGHT 75 PERCENT OF THE TIME: Using one of dozens of scenarios, undercover government auditors were mostly satisfied with the levels of assistance that they received at several of the Internal Revenue Service's Taxpayer Assistance Centers. A report from the office of the Treasury Inspector General for Tax Administration details the results of auditor visits to more than 70 TACs during the 2006 filing season. Using 47 standard scenarios, the auditors made anonymous visits to 50 TACs asking 200 tax law questions. Later, an additional 10 scenarios relating to the Katrina Emergency Tax Relief Act of 2005 were developed and another 20 visits to additional TACs were made to ask 80 questions.The report found that TAC workers:

Moss Adams LLP announced plans to acquire Phoenix-area firm Epstein Weber & Conover PLC, in a deal that will be effective Jan. 1, 2007. Financial terms were not disclosed.

Clifton Gunderson LLP has acquired the Colorado firm of Levine, Hughes & Mithuen in a merger effective Nov. 1.

A Senate panel’s review of interactions between imprisoned former lobbyist Jack Abramoff and a number of tax-exempt organizations had lead the committee to question the groups’ tax status and a portion of the federal Tax Code dealing with unrelated business income taxes.

Statistics show that more than 50 percent of marriages in the United States end in divorce.The process of a divorce can create tremendous animosity between the parties, and this can lead to difficult financial issues for those affected by the split. There are many complex federal tax issues that need to be planned for, or they will create tremendous pitfalls. The Internal Revenue Code also contains several provisions that provide specific guidance for divorce-related transactions.

Year-end tax planning opportunities abound this year. They do so not only because it has been a particularly active year for tax legislation, but also because of other significant tax developments taking place in 2006, as well as changes from pre-2006 tax legislation that have a particular impact this year and next.Traditional year-end tax strategies should not be abandoned. Income should either be accelerated or postponed between 2006 and 2007, depending upon the anticipated tax brackets for each client. Similarly, deductions and credits should be manipulated to lower income either in the more favorable year or, in some cases, in both years, before midnight, Dec. 31, 2006, has come and gone.

The Tax Foundation has released the 2007 edition of its guide comparing the business tax climate between states.