* BILLS INTRODUCED TO FORM NEW TAX REFORM COMMISSION: In the wake of a failed effort to push through a permanent repeal of the estate tax, two Republican congressman have introduced companion bills to form a new "Securing America's Future Economy Commission."The 15-member commission would have the ability to reform tax policy and entitlement benefit programs, and function similarly to the military base closing commission - with proposed legislative packages receiving an up-or-down vote from Congress. The president or the budget committee of either house of Congress would be able to submit alternatives.
In the bill from Rep. Frank Wolf, R-Va., the commission is charged with developing legislation to address four key issues:
* The unsustainable imbalance between long-term federal spending commitments and projected revenues;
* Increasing net national savings to provide for domestic investment and economic growth;
* The implications of foreign ownership of debt instruments issued by the U.S. government; and,
* Improving the budget process to place greater emphasis on long-term fiscal issues.
The Senate version is sponsored by George Voinovich, R-Ohio.
Under the legislation, the president would have the ability to appoint three commission members, including a chair, while the majority and minority leaders in Congress would each appoint their own trio of members. The comptroller general and the director of the Congressional Budget Office would also serve as non-voting members.
The recommendations from the last high-profile tax reform committee received little political traction when they were released in November 2005.
* WALKER TALKS OBSTACLES TO CORPORATE TAX ENFORCEMENT: In testimony before the Senate Finance Committee, Comptroller General David Walker said that it is impossible to know the total amount of corporate tax avoidance for a number of reasons. He said that the complex Tax Code, complex business transactions and often-multinational corporate structures make determining corporate tax liabilities and the extent of corporate tax avoidance a major challenge.
The Internal Revenue Service has estimated the total amount of corporate tax noncompliance to be about $32 billion. Corporate income taxes are expected to bring in about $277 billion in 2006. Among the methods that Walker suggested to improve compliance were simplifying the Tax Code, obtaining better data on noncompliance, continuing to oversee the effectiveness of IRS enforcement, leveraging technology and increasing collections of taxes owed.
In a companion report, the Government Accountability Office said that many taxpayers misreport capital gains or losses, sometimes inappropriately underpaying their taxes and sometimes overpaying. The GAO said that expanding third-party information reporting on the cost basis of capital assets could help address the problem. It also suggested that Congress consider requiring brokers to report adjusted basis to taxpayers and the IRS, and requiring the IRS to work with the securities industry to develop ways to mitigate reporting challenges and clarify its guidance on reporting capital gains and losses.
Walker's full testimony is available at www.gao.gov.
* OFFICE OF TAXPAYER BURDEN REACHES OUT TO PUBLIC: The Internal Revenue Service's Office of Taxpayer Burden Reduction is asking the public for recommendations on ways to reduce the burden on taxpayers.
The office encourages tax professionals, business owners and others to submit their proposals for ways to reduce the burden by using referral Form 13285A, Reducing Burden on America's Taxpayers. The form requests a specific description of the problem, as well as a proposed solution and the type of taxpayers or businesses that are affected.
This year, several initiatives were coordinated through the Office of Taxpayer Burden Reduction, including:
* An automatic six-month tax-filing extension for most common individual and business returns;
* Simplified tax filing requirements for small employers with Form 944; and,
* The revised Schedule K-1 for partnerships, S corporations and trusts.
More information on completing the form is available at www.irs.gov/newsroom/article/0,,id=158513,00.html.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access