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Accounting News Roundup: Romney’s “Big Idea”; Why Big 4 Audits Suck; Payroll Tax Cut Isn’t Dead Yet | 10.22.12

Romney's Tax Deduction Cap [WSJ]
[D]etails aside, the tax cap is a big idea, and potentially a very good one. The proposal makes economic sense to the extent that it helps to pay for lower marginal tax rates. Lower rates with fewer deductions improve the incentive for investing and taking risks based on the best return on capital rather than favoring one kind of investment (say, housing) over another. This would help economic growth. The idea may be even better politically. The historic challenge for tax reformers is defeating the most powerful lobbies in Washington that exist to preserve their special tax privileges. Among the biggest is the housing lobby that exists to preserve the mortgage-interest deduction—the Realtors, home builders, mortgage brokers and the whole Fannie Mae gang. But don't forget the life insurance lobby (which benefits from the tax exclusion on the equity buildup in policies), the tax-free municipal bond interest lobby, the charitable deduction lobby and more. Each one will fight to the death to preserve its carve-out, which means that reformers have to engage in political trench warfare to succeed. This is one reason President Obama wants Mr. Romney to be more specific: The minute he proposed to limit the mortgage-interest deduction, the housing lobby would do the Obama campaign's bidding by running ads against Mr. Romney's plan. Mr. Romney is right not to fall for this sucker play.

Arrogance or Ignorance: Why the Big Four Don't Do Better Audits [GOA]
The Grumpies say, "Both!" Plus, a twist of "stupidity" and an anecdote that involves a Big 4 blaming the client.

Senior House Democrat revives discussion of payroll tax cut extension [The Hill]
In an interview taped for C-SPAN’s “Newsmakers” program, Rep. Chris Van Hollen (D-Md.) said lawmakers should think twice about letting the tax cut lapse at the end of the year. “I don’ t think anyone thinks we should permanently extend the payroll tax cut, but given the situation we’re in, I don’t think that should be taken off the table.”

Same-sex marriage advocates get another court victory thanks to tax argument [DMWT]
Taxes save the day.

IRS schedules auction for large Packers collection [GWM]
Christopher York owes $187,949 in back taxes, and the IRS found that his collection of Green Bay Packers tchotchkes ought to fetch a fair amount of that.

Benefits of the Boomerang [WSJ]

Girl Mistaken For Skunk Gets Shot By Relative: Cops [AP]
New Sewickley Township police say the girl was over a hillside and wearing a black costume and a black hat with a white tassel. Chief Ronald Leindecker told the Beaver County Times that a male relative mistook her for a skunk and fired a shotgun, hitting her in the shoulder, arm, back and neck Saturday night. Leindecker told the newspaper that the girl was alert and talking when she was flown to Children's Hospital of Pittsburgh, about 30 miles away. Her condition was unavailable.

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