October 5, 2022

Accounting News Roundup: Scott London’s Non-existent Baseball Career; An Alternative Maximum Tax; Trojan Providing Free Stimulus on Tax Day | 04.15.13

Scott London, KPMG Partner Accused Of Insider Trading, Lied About Baseball Career [HP]
"There is no record of him ever playing baseball at Cal State Northridge,” Bob Vazquez, assistant athletic director at Cal State Northridge told The Huffington Post. “We checked our old media guides and media statistics. We want back from 1981 to 1986. His name is not listed.”

The Economic Case Against Tax Deductions [BBW]
Current U.S. tax law features 72,000 pages, which is a big reason why the country has  1.2 million professional tax preparers. What makes the tax system complicated isn’t marginal rates—as flat taxers claim—but all the deductions and exemptions. The tax code asks taxpayers to distinguish between farm vs. non-farm income, our earnings as a minister on Sunday as opposed to what we make reading tarot cards during the week, our conservation reserve payments vs. what we spent on mining and intangible drilling costs. Each can be taxed differently or, if we’re lucky, deducted altogether. Yet there’s little economic rationale for any of them.

America Needs an Alternative Maximum Tax [WSJ]
With Monday's deadline for filing tax returns looming, let's start a national conversation: How much is the most anyone should have to pay? When do taxes indisputably start to harm the economy and produce less revenue—when government takes 50% of people's income? 60%? 70%? I like half, but the principle matters more than the number. Once the country settles on a number, each of us gets to add up everything we pay to government at every level: federal income taxes, yes, but also payroll (Social Security, Medicare, etc.) taxes, state, city and county taxes, estate taxes, property taxes, sales taxes, payroll taxes and unemployment insurance for nannies, household workers, or other employees, excise taxes, real-estate transfer taxes, and so on and on, right down to your vehicle stickers and those annoying extra taxes on your airline tickets. On April 15, once this total hits the alternative maximum tax, you've done your bit and federal income taxes can take no more. You compute federal income taxes as usual, but then you get to reduce the "tax due" that the total is less than the alternative maximum.

Lehman International Creditors May Be Repaid in Full, PwC Says [BBW]
Creditors to Lehman Brothers International Europe may be repaid in full after administrators settled disputes with some of the failed investment bank’s affiliates, increasing the size of expected future recoveries. A recent agreement with a Lehman affiliate has freed up an additional $9.1 billion of assets, which will be distributed later this year, according to an e-mailed statement from PriceWaterhouseCoopers LLP. LBIE is planning a second dividend to unsecured creditors, as well as a first distribution to client money claimants this month. “To be able to advise ordinary unsecured creditors that we now have a reasonable chance of eventually repaying their claims in full, marks a significant milestone,” Tony Lomas, lead administrator at PwC, said in the statement. “We do expect to pay a second, significant dividend to creditors in the near future, taking us another step towards this new target.”

 

Accountant Sentenced for Fraud, Plotting Clients’ Murders [NBC]
Former IRS agent-turned-accountant Steven Martinez, 51, once lived the high life in his multi-million dollar mansion in Ramona. He became a successful accountant preparing taxes for high-end clients, but was eventually convicted of stealing more than $11 million in tax payments from those clients – and then, in a plot twist, plotting their murders. According to the FBI and federal prosecutors, Martinez stole millions from his wealthy clients over the years by preparing phony tax returns from 2004 through 2007 and then pocketing the tax money.

Insider Trading or Lack of Transparency: Which is the Bigger Sin? [GOA]
There is simply no getting around it…this is a watershed event…this is a once in a generation occurrence…this is much worse than Deloitte’s insider trading problem.  Why?  This is about a major accounting firm violating the bedrock independence standards upon which the auditing profession is founded.
 
Tax Day freebies range from snacks to sex toys [USAT]
Trojan is handing out vibrators at pleasure carts today in San Francisco and Los Angeles. 

 

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