Tax

What kind of company processes payroll and credit card and check payments, and offers banking services and account aggregation? Increasingly, the answer is an accounting software company.

The Treasury Department and the Internal Revenue Service issued a notice providing extensive guidance on several Pension Protection Act rules relating to distributions from tax-qualified retirement plans. The guidance addresses many questions on the law’s provisions, including:

In a brief filed Monday in federal appeals court, 30 states said that a number of investment banks are liable for their alleged role in Enron Corp.’s accounting fraud.

Sage Software has unveiled its annual tax update release for its Sage FAS Fixed Assets product line.

The Internal Revenue Service will begin processing both e-file and paper tax returns that include claims for the major “extender” provisions enacted by Congress on Feb. 3.

Joining an increasingly loud chorus, National Taxpayer Advocate Nina E. Olson released her annual report to Congress, designating the alternative minimum tax and the federal tax gap as the most serious problems facing taxpayers.Olson also reserved a healthy dose of the 80-page-report’s scorn for concerns about the Internal Revenue Service’s collection policies and the transparency of IRS information to the tax-paying public.

Partnership taxpayers can electronically file now use the modernized e-File platform when filing Form 1065, “U.S. Return of Partnership Income,” and Form 1065-B, “U.S. Return of Income for Electing Large Partnerships.”

Liberty Tax Service announced the acquisition of eSmartTax, the income tax preparation business of San Jose, Calif.-based C&S Technologies.

Choosing 529 plans or qualified tuition programs as a savings strategy for the college-bound got more enticing in 2006 as the programs' tax-exempt status gained permanency, and student-owned accounts would no longer need to be reported on financial aid applications."New legislation in 2006 created a significant advantage in 529 plans," said Joe Hurley, CPA and founder of Savingforcollege.com. "Accounts owned by students or custodians by the Uniform Transfer to Minors Act are no longer reported on financial aid applications if the student files as a dependent student. Before, they were reported as student assets and assessed at a very high rate."

The Swedish Tax Authority is taking another route in its attempts to get a former member of ABBA to pay millions in allegedly undeclared royalties.According to published reports, tax officials want ABBA co-founder Bjorn Ulvaeus to pay $2.1 million for undeclared royalties from the music group’s hits. In May 2006 the authority claimed that Ulvaeus owed almost $13 million in back taxes, fees and interest on unpaid taxes related to contracts he signed before moving to England in 1984.