Finance

The Internal Revenue Service plans to offer several new ways to help people struggling to meet their tax obligations because of the recession, and will expand its Free File program to allow nearly all taxpayers to electronically file their taxes for free.

Israel's fifth largest accounting firm, BDO Ziv Haft, has reportedly cut salaries across the board by 5 to 10 percent for all but the lowest paid employees.

With 210 federal securities class-action lawsuits filed in 2008, the level of litigation last year was at its highest level since 2004, according to a new study.

They’re back and ready to dole out hundreds of billions of dollars in new tax cuts and spending, but will it be enough to restart the limping economy?

National Taxpayer Advocate Nina Olson said in her annual report to Congress that taxpayers affected by the recession should be treated more compassionately by the IRS.

President-elect Barack Obama and his transition team reportedly plan to propose approximately $300 billion in tax cuts as part of an overall economic stimulus package.

Accounting firm Holtz Rubenstein Reminick plans to hold a town hall-style meeting for New York-based individuals or businesses that were defrauded by Bernard Madoff's investment scam.

SEC Inspector General H. David Kotz told a congressional panel that the Securities and Exchange Commission is ramping up its investigation of Bernard Madoff and his $50 billion Ponzi scheme.

A commission is expected to recommend a 50 percent increase in federal gasoline taxes to help fund infrastructure projects.

Accounting firm Goldstein Lieberman has introduced a consulting team to help business clients cope with the recession.

It looks as though many Americans are cashing in their 401(k)s prematurely. So says Take Charge America, one of the nation’s largest non-profit financial education, credit counseling, and debt management companies-- based upon a recent survey. According to Take Charge America, more than one-third of the individuals polled said they would consider meeting current financial obligations through their 401(k) and retirement savings. Of course, add to this that pursuant to a recent AARP study, more than 10 percent of people 50-70 years of age had already retired and are going back to work because of the economy. “The age at which Americans can retire will continue to increase as many individuals look for quick fix solutions for current financial woes,” says Mike Sullivan, director of education for Take Charge America. The company offers certified credit counselors to provide financial advice for those dealing with the financial crisis and Sullivan has some good advice to navigate retirement planning: 1) Don’t Consider Cashing Out a 401(k) Early. He says this is almost always a bad idea because the individual is slapped with large penalties and taxes. He notes that if the person is under 59 ½, there is likely to be a 10 percent penalty plus taxes owed on the funds. “The government requires that 20 percent of the amount payable is automatically withheld on the taxable portion of the withdrawal and that could mean a total of 30 percent of the investment paid in taxes and penalties.” 2) Don’t Retire, Hold onto the Paycheck. Sullivan adds that postponing retirement can provide larger benefits. In fact, he notes that the government is now looking at age 67 as the new retirement age although many people are targeting 69 or 70. 3) Take Care of Health. Sullivan points out that staying healthy helps avoid medical costs and though its sounds simple, he says that keeping weight in check by eating less and avoiding fats and sweets can pay dividends in the future. Plus, exercise regularly and vigorously, and avoid alcohol and tobacco. 4) Change the Lifestyle. Although he admits it may seem drastic, Sullivan says that the best response to credit issues is to stop charging, put away credit cards, and get on a budget. He concludes that it is tempting to look at the 401(k) as a resource to alleviate current financial burdens but that changes in lifestyle, including spending habits, taking care of health, and eliminating excess expenditures can help secure financial independence “without jeopardizing” the future. Take Charge America can be reached at (888) 822-9193. Their Web site is www.takechargeamerica.org.

The court-appointed trustee for the liquidation of Bernard Madoff's investment securities firm has received $29 million from the disgraced asset manager's bank account that he plans to distribute to defrauded investors.

The Treasury Department plans to purchase $5 billion in equity from GMAC, and lend another $1 billion to the automobile-financing company.

The Treasury Department released a letter with responses to 10 questions posed by a recent report that criticized its management of the Troubled Asset Relief Program.

The International Accounting Standards Board and the Financial Accounting Standards Board have attracted a set of high-profile members from around the world to form an advisory group on the financial crisis.

The Securities and Exchange Commission has released its eagerly anticipated report on mark-to-market accounting calling for improvements in fair value accounting standards, but not suspension of them.

The majority of banks and financial services companies bailed out by the Troubled Asset Relief Program are probably in worse condition than publicly disclosed, according to an new study.

A group of 61 members of Congress has written to President Bush asking him to suspend rules that require senior citizens to withdraw money from their severely depleted retirement accounts by the end of the year.

PricewaterhouseCoopers believes that M&A activity will be dominated in 2009 by "mergers of necessity" as distressed companies seek the protection of more stable parents.

The Internal Revenue Service has given Section 529 tuition programs the ability to change their investment strategies more frequently in response to the financial crisis.