Friday, June 28, 2013

WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’


Lots of BUZZ this installment!

* Check out “My Final Word on CPA vs EA or RTRP" at THE TAX PROFESSIONAL.  And let me know your opinion.  

Joe Kristan, a CPA, commented on my CPA vs EA vs RTRP post, as I expected he would, in his Tuesday “Tax Roundup” at the ROTH AND COMPANY TAX UPDATE BLOG.

Here is some of what Joe said (highlight is mine) -

·   Robert is correct, though, when he says ‘A CPA is not automatically a 1040 expert, but a specific CPA may be a 1040 expert’.

·   I do think that CPAs who do tax work tend to be very capable, but so are many non-CPA preparers.

·   You should choose your tax preparer not just because of initials; you should find out what kind of work the preparer does.  And check references.”

Peter J Reilly adds the following to the discussion in his FORBES.COM post “Enrolled Agents Deserve More Respect” (again, highlight is mine) –

He {me – rdf} does have a valid point.  To become an EA you have to show you know quite a bit about federal taxes.  To become a CPA you have to prove you know a bit about federal taxes but also quite a bit about a lot of other stuff.  If, for the rest of your career, you focus on the other stuff, your limited stock of tax knowledge will quickly wither away.”

* And a reminder - Did you know “The Energy Credit is Still Here For 2013”?  I explain at MAINSTREET.COM.

* The big tax news of the week was the Supreme Court decision that the Defense of Marriage Act (DOMA) was unconstitutional.

PARKER TAX PUBLISHING provides a good overview of the decision and what it means taxwise in “DOMA Struck Down - Opening the Floodgates for Amended Tax Returns.”

As PTP points out –

In the short term, practitioners have an opportunity to begin filing amended returns to obtain income tax refunds for any same-sex clients who were married under state law but precluded from filing a joint federal income tax return. Similarly, for individuals who were in a situation similar to Edith Windsor, refund claims can now be filed for estate taxes paid on property inherited from a same-sex partner to whom the individual was married under state law.”      
 
* At ACCOUNTING TODAY Mira Fine suggests that the “President’s Tax Proposals Seek to Reduce Deficit while Promoting Investment”.

Here are some of BO’s tax proposals -

The administration wants to raise taxes on the wealthy: by reducing itemized deductions to 28 percent for families in the top three income brackets; by imposing the Buffet Rule where millionaires pay no less than 30 percent of their income in taxes; and capping IRA account values that would provide a 62-year-old person with $205,000 in annual income.

In the estate planning area, the administration wants to, beginning in 2018, return the generation-skipping transfer and gift tax exemption rates to 2009 levels, with a top rate of 45 percent and an exclusion amount of $3.5 million (down from $5.2 million) and $1 million for gift taxes.”  

Bad ideas! 

And further proof that BO has no real interest in enacting true tax reform.  Unfortunately we must rely on the idiots in Congress.

* Along those lines, POLITICO gives us some good news – “Max Baucus and Orrin Hatch Tax Reform Plan: Wipe Slate Clean”.

We are told -

Committee Chairman Max Baucus (D-Mont.) and Utah Sen. Orrin Hatch, the panel’s top Republican, are preparing to release a tax reform framework on Thursday that essentially starts from a clean slate, according to more than a half-dozen lobbyists familiar with the discussion. That means eliminating virtually all existing deductions, credits and expenditures to dramatically lower corporate and individual tax rates.”

* Back to ACCOUNTING TODAY – where Michael Cohn reports “Trial Date Set for IRS Appeal of Tax Preparer Lawsuit” –

A federal appeals court in Washington, D.C., has scheduled oral arguments for September 24 to hear the Internal Revenue Service’s appeal of Loving v. IRS, the case in which a trio of independent tax preparers successfully sued the IRS to suspend its mandatory testing and continuing education requirements for tax preparers.”

The absolute worst case scenario is that the IRS wins the appeal.  Given the lateness in the year the IRS would need to set the deadline for RTRP candidates to take and pass the competency test at December 31, 2014 – so I would not have to take the test in order to prepare 2013 tax returns in 2014.  And I would have more than a year to continue to lobby for grandfathering.

But I do believe that the IRS will NOT win its appeal – and the mandatory RTRP program will remain dead.

And, considering the ongoing examples of IRS mismanagement, Congress, despite being composed of idiots, is not going to give the IRS the authority to force licensure.

* Speaking of ongoing examples of IRS mismanagement, here is the latest from Robert W Wood of FORBES.COM – “IRS Using Tax Dollars For Porn, Wine, $100 Lunches?”.

* Two good items of interest from JK LASSER. 

First – the answer to the question “I sold some municipal bonds at a loss. Can I deduct the loss?


The second has good bottom line advice for the graduate –

If 2013 is the first year for which you will have to file a tax return (next April 2014), acquaint yourself now with general income tax rules. This will help you better understand employee fringe benefits as well as your annual tax filing obligations.”

Hey – one way to acquaint yourself with general tax rules is to become a regular visitor to THE WANDERING TAX PRO!

* Miranda Marquit also provides advice to graduates in “College Grads: Avoid these 401(k) Mistakes at Your First Job” at BARGAINEERING.  

* Oi vey! More news on IRS FUs at FORBES.COM.  Kelly Phillips Erb, the internet’s TAXGIRL, tells us “Millions Of Tax Dollars Improperly Refunded To Unauthorized Workers As IRS Insists It's Getting Better”.
 

* Check out these “Strange & Unusual Taxes throughout History from Around the World” shared by EFILE.COM.

* And last, but certainly not least, this week Bruce McFarland’s weekly Tuesday “McTax Hangout” YouTube “tv show” dealt with “Travel Expenses”.
 
THE FINAL WORD-

Part One -

North West? 

What total idiots!

If the father was a Mr. Kong would the talentless and self-absorbed Kim K have named her child Donkey?

I feel sorry for the child.

Part Two –

I ended my post on the Death of DOMA with the following statement –

I do believe that television shows like WILL AND GRACE, and MODERN FAMILY {add ELLEN and GLEE} are partially responsible for the widespread acceptance of same-sex marriage and for this decision being possible.  Television can change the world!

The power of tv to influence society is why “reality tv excrement is dangerous!

TTFN

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