Tax

I discovered the most amazing thing this week -- a report on a federal agency that was actually readable.

Taxpayers can file their 2005 tax returns electronically beginning Jan. 13 as the Internal Revenue Service's E-file program opens for its 20th tax season.

Four additional professional tax organizations have agreed to partner with the Internal Revenue Service to provide assistance to taxpayers at local disaster recovery centers established by the Federal Emergency Management Agency, the IRS announced.

National Taxpayer Advocate Nina E. Olson released her latest report to Congress, again stressing the need for legislators to make simplification of the tax system a reality.

Corporate tax payments hitting an all-time high last month helped offset record federal spending.

The Internal Revenue Service sent out 17.7 million 1040 tax packages during the first of January to taxpayers who have previously filed paper returns. The number of paper tax booklets being mailed to Americans continues to decline as more people opt for electronic filing.

Practitioners who have been adding tax planning services to their basic preparation are taking an additional step to extend their practice into year-round financial planning."There's a natural progression from tax preparation into financial planning," said Stephen Parezo, media manager at Fiducial.

The House of Representatives passed the final piece of $95 billion in tax cuts in early December, in a vote split mostly along party lines.The most recent bill approved $56 billion in tax cuts over the next five years, including a two-year, $20 billion extension of President Bush's 2001 tax cut for stock dividends and capital gains.

TAX OVERHAUL MAY BE ANOTHER YEAR AWAY: Reports from inside the White House are that President Bush's administration may wait until 2007 to begin pushing a proposal to overhaul the tax code.A proposal was originally planned as a key part of President Bush's second-term agenda, but Republican sources have said that any push would have problems gaining traction in a mid-term election cycle. The Treasury is currently reviewing the recommendations issued by the President's Advisory Panel for Tax Reform before submitting a plan to the president.

As the Internal Revenue Service moves towards its goal of 80 percent e-filing for individuals, it is placing more emphasis on the e-filing of corporate returns.In 2005, over 200,000 corporations voluntarily e-filed, and beginning in 2006, many corporations will be required to file electronically. Recently issued regulations require corporations with assets of $50 million or more that file over 250 returns each year to file Forms 1120 and 1120S electronically, starting with tax periods ending on or after Dec. 31, 2005.