GRASSLEY, BAUCUS INVESTIGATE IN-KIND CHARITABLE CONTRIBUTIONS: Sen. Chuck Grassley, R-Iowa, chairman of the Committee on Finance, and Sen. Max Baucus, D-Mont., ranking member, have advanced their review of in-kind charitable contributions by asking the Internal Revenue Service to explain its actions to prevent abuse and for key documents detailing such contributions.
“Car donations are getting the most headlines because the General Accounting Office and the Treasury Department agree that the amounts of taxpayers’ deductions often substantially exceed the fair market values of the donated vehicles,” Grassley said. “But cars aren’t the only charitable gift in this category. Donations of land, art and intellectual property are all raising concerns. It appears we’re just scratching the surface. It’s important to get a good handle on all areas of abuse to allow taxpayers to take the deductions they’ve earned, rather than what they’ve inflated.”
Baucus added, “It appears that a significant number of audits are falling through the cracks at the Internal Revenue Service when it comes to follow-up on charitable donations. While tax breaks have helped increase giving to charities by encouraging more people to donate, the structure is also a magnet for tax abuse. And that’s where the IRS should come in.”
“But it’s clear that there’s a problem when no action is taken by the IRS in 2001 and 2002 regarding the thousands of cases that were referred for audit due to potential noncompliance on charitable donations involving at least $5,000,” said Baucus. “Not a single examination was conducted nor dollar collected. We can no longer ignore the abuses taking place involving our tax laws.”
The senators are working to advance reforms of vehicle and intellectual property donations through their foreign sales corporation/extraterritorial income act bill, which is pending before the full Senate. They plan to develop additional reform proposals as needed.
ASPEN’S TAX, ACCOUNTING, AUDIT TITLES MOVE TO CCH: Information publishing giant Wolters Kluwer has integrated the tax, accounting and audit titles of Aspen Publishers into the CCH Tax and Accounting group.
Riverwoods, Ill.-based CCH and New York-based Aspen Publishers are Wolters Kluwer companies and comprise the CCH Tax and Accounting unit, which provides tax and accounting information, software and services.
The transition will take place in stages, culminating with the re-branding of Aspen tax, accounting and auditing publications with the CCH name and logo. Marketing communications will include information about both CCH and Aspen tax, accounting and auditing titles, with a single CCH point of contact for ordering. Aspen’s legal and legal education titles are not affected by the change.
STOLEN BLOCK SERVER HAD INFO ON 50,000 TAXPAYERS: More than 50,000 H&R Block customers were notified by the company that their data may have been compromised by the theft of a network server.
“It was going in for repair, but it was stolen,” company spokeswoman Denise Sposato said of the server, which she noted contained customer names from 1998 to 2002.
The customers who were affected received a letter last week from the tax prep firm.
The only viewable data was on seven fields — first name, middle initial, last name, street address, city, state and zip code, according to Sposato.
“Any information beyond that was compressed, and since there was no proprietary software on there, the chances of trying to open it up are almost nil,” she said. “We notified the clients by letter to let them know that it happened.”
“We tried to minimize their concern, but we also let them know that if they wanted a greater comfort level, they could report it to one of three credit reporting agencies to put them on fraud alert. This way, if anyone were ever able to get at and use the compressed information, they would be notified,” Sposato said.
