Practice management

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.

The Senate Finance Committee didn’t get the answers it was hoping for during a hearing this week with Treasury Department representatives on how to reduce the tax gap.In testimony before the committee, Treasury Secretary Henry Paulson said that Congress should focus its efforts on reducing the complexity of the tax code, as well as approving the entire budget request from the Internal Revenue Service and enacting the Treasury’s February legislative proposals that are backed by President Bush. Paulson said that in developing more than a dozen proposals to minimize the gap, the Treasury focused on changes that would come with minimal additional burdens.

Solutions to your problems are everywhere. Just look at all the products, services and companies that proudly proclaim their status as solutions.

Taxpayers frustrated by delays in Intuit Inc.’s tax-processing capabilities will have until midnight on April 19 to electronically file their returns.The Internal Revenue Service and Intuit said that as many as several hundred thousand last-minute tax filers were affected by Intuit’s server problems Tuesday night -- meaning that they, or their accountants, may have been unable to electronically file returns.

The Internal Revenue Service will grant a six-month tax filing and payment extension to those affected by the shootings at Virginia Tech.The relief applies to the victims, their families and emergency responders, as well as university students and employees.

If Democrats are serious about rolling back the alternative minimum tax, then they should be happy to have gotten a little more fodder last week to use in whatever PR campaign accompanies the unveiling of their plan.The White House released copies of the tax returns for both the Bushes and the Cheneys last Friday, and both families somehow found their way to avoiding the AMT.

Internal Revenue Service Commissioner Mark Everson will leave the agency to become president and chief executive of the American Red Cross next month.Everson, 52, has served as IRS commissioner since May 2003. During his time with the agency, he has publicly focused his attention on efforts to better serve taxpayers, continue the agency’s modernization of its systems and enhance its enforcement activities. In recent months, Everson has heard increased clamoring from Congress over how the agency and the Treasury Department should best work to address the nation’s growing tax gap -- estimated at $345 billion for the 2001 tax year.

A real estate investor from Brooklyn, N.Y., had the requisite skillz to win the $25,000 TaxRap contest sponsored by TurboTax.In a statement, the company said that the submission from Christian Pulfer, 28, stood out as one of the most individual and creative entries. Pulfer’s entry, “It’s Just a Breeze…G,” was selected by guest judge Vanilla Ice from more than 370 homemade rap videos.

Carbis Walker LLP, a firm specializing in public accounting and consulting, is offering manufacturers and distributors the opportunity to participate in a national benchmarking survey through a partnership with McGladrey & Pullen LLP.

Jayne V. Bates is in the home stretch of her one-year term as president of the Association for Accounting Marketing, which will end in July. Bates has served on the association’s board of directors since January 2001.Herself a CPA, Bates is currently the director of marketing for Carter, Belcourt & Atkinson PA CPAs, a firm based in Lakeland and Tampa, Fla. She has been with CBA for nearly 20 years, spending her first eight years with the firm as a professional staff accountant and serving in a marketing capacity during the rest of her tenure.

When Matt Camden, chief information officer at UHY Advisors in Chicago, faced an audit server outage in one of his New England offices over a February weekend, he was able to restore his data in a period of 11 hours."Two of our disks failed, which is a terrible thing to happen," Camden recalled. "All we had to do is put new server hardware in place, which is our responsibility, then we got the data back up, loaded it, and it worked like a charm." He credited his online data protection company, EVault, for the rapid restoration process.

IRS REVISES OFFER IN COMPROMISE APPLICATIONWASHINGTON - The Internal Revenue Service announced that its revised taxpayer application for an offer in compromise, Form 656, is now available. The Form 656 package was last revised in 2004 to help taxpayers prepare an offer correctly and completely.

Strategies for the use of tax-deferred like-kind exchanges have grown over the years from almost exclusively a real estate concern to one in which billions of dollars of business tangible personal property are traded each year. While the main battle continues to be waged over what dissimilarities in property are allowed and still qualify as "like kind," another fight has developed over how the property received in a like-kind exchange is to be depreciated.After tinkering with the depreciation rules in 2001 and 2004, the Treasury issued final regulations early in 2007. In its preamble to the final regs, the Treasury admitted that confusion and resulting inconsistency among taxpayers had developed. The final regs appear to do little to end those problems.

Recently, a managing partner shared with me his answer to the question, "When does turnover begin?" His reply was, "At the beginning."Duh! Why didn't I think of that? So, if employee turnover begins with the selection process, what steps can we take to improve it? There are many steps in the recruitment and selection process - and as they say, the devil is in the details. Here are some suggestions:

The Government Accountability Office said that the Internal Revenue Service doesn’t appear to be in a position to develop its own software for tax preparation anytime soon.As part of its partnership with the Free File Alliance, in exchange for a number of tax prep providers agreeing to provider their software free of charge to certain taxpayers, the IRS has agreed not to develop its own software. But because increased electronic filing would reduce the agency’s processing costs, reduce transcription errors and speed up refund turnaround, the GAO was looked to examine the benefits and costs of the agency creating its own online tax prep offering.

In an annual ritual, many small businesses rush out after tax season to take their accountant's advice on the tax benefits of incorporation, and business software and services company Intuit has relaunched its online incorporation and document-filing services site to coincide with the rush.

A combination of both strong economic growth and low unemployment helped keep state tax rates flat for 2006. Nevertheless, some states are continuing to mine tax-related revenue streams."Currently, there are several states that are looking to improve their tax structure," explained Curtis Dubay, an economist at the Tax Foundation.

One of my former employers has been the occasional subject of this column -- particularly when the topic centered on how not to run a business.

The American Enterprise Institute has released a new public opinion study that focuses on Americans’ historical attitudes to taxes.The study, “Public Opinion on Taxes,” was compiled by senior fellow Karlyn Bowman, who used available polling data to examine how attitudes toward paying taxes have changed over the past half century.

The Internal Revenue Service is reminding taxpayers to file their tax returns by the April 17 deadline and to pay as much as they can of any taxes they owe to minimize any accrued penalties and interest.