Tax

Citing rising costs in Medicaid and education which in turn led to higher spending levels and ultimately higher taxes, state taxpayer burdens rose more than 40 percent between 1994 and 2004.

The Senate passed a bill containing $70 billion in tax cuts, part of a budget push Republicans are hoping will lead to an extension of President Bush's tax cuts.

The Internal Revenue Service will host a series of six tax forums across the nation this summer for tax professionals.

President Bush did not mention tax reform in his State of the Union Address, generally talking only about the importance of keeping the country competitive in the world marketplace by ensuring the economy continues to grow.

Smart and Associates LLP has acquired the compensation and benefits tax practice of KPMG. Terms of the transaction were not disclosed.

Living in the world of accounting news from 9 to 5 everyday, it's become apparent that not a heck of a lot of my day job transfers over to my world outside of work.

H&R BLOCK TO PAY $62M TO SETTLE REFUND SUITS: Tax preparation giant H&R Block Inc. will pay $62.5 million to settle class-action lawsuits over its use of refund anticipation loans. Block said that the settlement would cover more than 8 million customers who received the loans between 1989 and 2005. The company has already set aside money for the potential settlement and announced that it plans to take a third-quarter charge of $31 million to cover the remainder of the settlement.The lawsuits said that RALs took advantage of financially unsophisticated taxpayers who were not adequately informed about high interest rates. Besides the cash settlement, Block agreed that it would better advise customers in the future about other options in filing taxes and gaining refunds quickly, as well as any interest charges or other fees they would have to pay. A federal judge in West Virginia was scheduled to review the settlement. If approved, the deal will resolve four class-action suits filed in West Virginia, Ohio, Alabama and Maryland, along with claims pending in 22 other states and Washington, D.C. Block still faces two other lawsuits tied to the loans.

Tax law changes, a surge in business e-filing, and a move by practitioners toward greater use of the Internet will impact the type of filing season that tax preparers have this year."It will be typical year in terms of filing," observed John Hewitt, chief executive officer of Virginia Beach, Va.-based Liberty Tax Service. "About a million-and-a-half to two million more people will file returns than last year."

Although tax experts from across the spectrum predict that a real tax reform is in our future, they are divided on how soon it will happen or what form it will take.Mark Weinberger, former Treasury assistant secretary for tax policy, said during a recent Tax Analysts-sponsored Webcast that tax reform will eventually happen. However, said Weinberger, currently Americas vice chair for tax services for Ernst & Young, the structure and timing are still up in the air.

Congress, in the waning days of its 2005 session, after failing to carry out significant parts of its tax agenda for the year, has managed to pass a Gulf Coast recovery tax act. As is common with the "last stagecoach out of town" for the year, a lot of things managed to "jump on."The hurricane provisions take up 84 pages of bill text, but the legislation goes on for another 100 pages. Among the areas addressed beyond hurricane recovery and relief are a few extensions of expiring provisions, a couple of miscellaneous items, and a huge package of technical corrections covering 10 pieces of tax legislation going back as far as 1987.