Tax planning

J.J. Pickle, former Congressman, tax writer and an ardent reformer of Social Security, died last week here at the age of 91. While serving as chair of the Ways and Means Committee Social Security Subcommittee, Pickle was a key figure in Social Security legislation to keep the system from becoming insolvent and was, according to reports, responsible for the provision that gradually raised the age of eligibility for benefits from 65 to 67. Pickle also served as chair of the Ways and Means Oversight Subcommittee, where he promoted research incentives and investigated a host of tax issues. He retired from Congress 10 years ago, after serving more than three decades.

Richard J. Morgante and Pamela G. Watson have been named to the top two posts in the Wage and Investment Division, the Internal Revenue Service unit that serves most individual taxpayers. Morgante, currently the division's deputy commissioner, will move up to W&I commissioner, and Watson, now the division's compliance director,will succeed him as W&I's second highest executive. Both appointments will take effect in early July. Morgante succeeds Henry Lamar, who is retiring after 34 years with the IRS, the last two as W&I commissioner."Rich and Pam make a strong team, and their leadership and experience will help us effectively serve taxpayers and enforce the law," said IRS Commissioner Mark W. Everson. Based in Atlanta, W&I has processing and customer service responsibility for virtually all taxpayers, processing approximately 175 million paper and electronic returns for individuals and businesses last year, answering 67.3 million automated and assistor calls, and serving over 7 million customers face-to-face.

With tax season over, now is the time for tax practitioners to tinker with different software to find a better fit for their practices. At the same time, vendors hope to get a head start on next season's sales by offering special summer season discounts and tryouts.Meanwhile, there is good reason for preparers to be open to new software solutions.

FINANCE COMMITTEE TAKES AIM AT AMT: A bipartisan coalition of members of the U.S. Senate Finance Committee, including chairman Charles Grassley, R-Iowa; ranking member Max Baucus, D-Mont.; Ron Wyden, D-Ore.; and Jon Kyl, R-Ariz., have introduced legislation to repeal the alternative minimum tax.The Individual Alternative Minimum Tax Repeal Act of 2005 would amend the Internal Revenue Code to end the AMT beginning in the 2006 tax year.

Since its first meeting in February, the president's Advisory Panel on Federal Tax Reform has heard testimony and statements from more than 80 witnesses, and examined everything from the philosophical underpinnings and history of our current tax system, to the economic impact of potential tax systems.

In a victory for accounting firm BDO Seidman, a federal appeals court judge reversed a district court decision and ruled this week that a group of investors can't sue BDO Seidman over the sale of an illegal tax shelter, and instead must arbitrate their claim.

The President's Advisory Panel on Tax Reform will get an additional two months to complete its work.

The Senate Finance Committee has marked up the Energy Policy Tax Incentives Act of 2005, the title of the energy policy bill now before the full Senate.

CCH Tax and Accounting has added two major new stand-alone libraries in the Miller accounting and auditing series to its Accounting Research Manager.

Big Four firm KPMG LLP, which is in talks with the Justice Department related to the agency's ongoing tax shelter probe, said that it takes "full responsibility" for the past unlawful conduct by some its former partners.

The 2005 filing season was a good one for the Internal Revenue Service, according to the Treasury Inspector General for Tax Administration.

The IRS Oversight Board at its recent meeting raised concerns over the agency's plan to close some of its Taxpayer Assistance Centers this fall.

A California start-up is entering the online tax prep software fray with the launch of a new Web-based software package aimed at accounting firms with up to 15 practitioners.

The Internal Revenue Service will co-sponsor a free Webcast next week focusing on collection issues, including partial-payment installment agreements and offers in compromise.

Tax prep software maker Drake Software has named company veteran Tim Hubbs, CPA, as its president and chief executive.

Top-ranked accounting firms Marks Paneth & Shron LLP of New York City and Chattanooga, Tenn.-based Decosimo CPAs have forged a strategic alliance to provide sophisticated international tax planning and consulting services to midsized businesses.

The Internal Revenue Service is reminding taxpayers that the agency isn't kidding around when it comes to frivolous cases aimed at delaying tax collections.

In a move that promises to have far-reaching consequences for global operations and international tax compliance, the Supreme Court has ruled that defendants who evaded Canadian taxes could be prosecuted in the U.S. under federal wire fraud laws.

MCI agreed to pay $100 million in cash to the state of Mississippi for back taxes that the state claimed were owed by the company's predecessor, WorldCom.

A crackdown on abusive tax shelters that includes codifying the economic substance doctrine would create legal booby traps for small businesses and open the door for new abuses by unscrupulous tax shelter promoters, the American Institute of CPAs warned Congress.