ANR: Adieu to Mortgage-interest Deduction?; Unauthorized Child Credits Gone Wild; The War on Marriage (Through Penalties) | 08.22.12

Posted on by Caleb Newquist

Tax Reform Skirmish [WSJ]
It doesn't sound like much, but GOP reformers scored a victory this week against a formidable special interest. They managed to beat back an attempt by the real-estate lobby to put an endorsement of the mortgage-interest deduction into the 2012 Republican Party platform. Reformers had scored a bigger triumph on Monday by defeating the pleas and threats by the crowd that gave us Fannie Mae and helped produce the housing boom and bust: The tax reform plank initially left out any mention of the mortgage-interest carve-out. But the housing lobby struck back, and on Tuesday GOP platform writers added a clause saying that if the GOP failed on tax reform it would favor the retention of the mortgage-interest break.

Senate Republican: Unauthorized claims for child credit could hit $7 billion [The Hill]

A top Senate Republican said Tuesday that the federal government could hand out more than $7 billion this year in a refundable tax credit to workers not authorized to be in the U.S. The Treasury Department’s inspector general for tax administration has already said that unauthorized workers claimed $4.2 billion in Additional Child Tax Credits (ACTC) in 2010. Extrapolating from those numbers, the office of Sen. Jeff Sessions (Ala.), the ranking Republican on the Budget Committee, projected those ACTC claims would have hit $5.6 billion in 2011 and $7.4 billion in 2012. That would be up from $924 million in 2005, according to figures from the inspector general. Sessions and other GOP lawmakers, like Sen. David Vitter (La.), have pushed to stop unauthorized workers from receiving the ACTC. Tax breaks like the ACTC are called refundable tax credits because taxpayers can receive a cash refund even if they don’t have any tax liability. 
 
Man pleads guilty to theft from Buffett Foundation [OWH]
Dhaval S. Patel, 38, will be sentenced in November. He faces up to five years of probation or 20 years in prison. Patel made $190,000 a year as a senior program officer – traveling the world as a monitor of charities that the Buffett Foundation supports. Patel doctored several receipts for overnight stays, meals and travel – then requested reimbursement from the charity for those purported “expenses.”
 
Sixteen States Have Marriage Penalties [TaxProf]
The war on marriage goes on!
 
AICPA Recommends Changes to IRS Form 990 [AT]
FYI.
 
Red Lobster Waitress Attacked For Filling Water Glasses Too Often At St. Louis Location [HP]
Sharrell Evans, Britley Green and Geneen Green were charged with mob action and aggravated battery after allegedly throwing water on a waitress and striking her with their hands and a menu. A witness at the restaurant said the women were upset because the waitress was filling their glasses too often. Ambulance crews gave the waitress a quick evaluation, but she declined further medical attention and went back to work.

 

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Accounting News Roundup: E&Y to Appoint Non-Exec Directors to Global Board; Accounting Remains a Hot Post-College Job; Barclays Calls New Loan Valuation Proposal ‘Potentially Misleading’ | 07.06.10

‘Big four’ auditors bring in independent directors in response to regulators [Guardian]
The Financial Reporting CouncCAEW, issued a new audit governance code back in January that recommended audit firms appoint non-executive directors to their UK firm however, Ernst & Young will go so far to appoint them to their global advisory boards.

“Although the code technically applies only to our UK business, as a globally integrated organisation, we believe it is most appropriate for us to implement the code’s provisions on a global basis also,” said Jim Turley, global chairman and chief executive of Ernst & Young. “Including individuals from outside Ernst & Young on the global advisory council will bring to the senior leadership of our global organisation the benefit of significant outside perspectives and views.”

BP Won’t Issue New Equity to Cover Spill Costs [WSJ]
But if you want to pitch in, they are happy to take you up on an offer, “BP would welcome it if any existing shareholders or new investors want to expand their holding in the company, she said. BP’s shares have lost almost half their value since the Deepwater Horizon explosion that triggered the oil spill April 20.

BP Chief Executive Tony Hayward is visiting oil-rich Azerbaijan amid speculation the company may sell assets to help pay for the clean-up of the Gulf of Mexico oil spill. The one-day visit comes a week after Mr. Hayward, who has been criticized for his handling of the devastating oil spill, traveled to Moscow to reassure Russia that the British energy company is committed to investments there.”

Looking for a post-college job? Try accounting [CNN]
Happy times continue for accounting grads, according to the latest survey on the matter, this time from the National Association of Colleges and Employers. The average salary listed for an entry-level accounting major is just over $50k and the article also notes that most accounting jobs go to…wait…accounting majors.


FASB, IASB Staff Describe Plans for New Financial Statements [Compliance Week]
As always, the two Boards are hoping that bright financial statement users will chime in with their suggestions but they’ve got the basic idea down, “The FASB and IASB are rewriting the manner in which financial information is presented to make it more cohesive, easier to comprehend, and more comparable across different entities. The proposals would establish a common structure for each of the financial statements with required sections, categories, subcategories and related subtotals. It would result in the display of related information in the same sections, categories and subcategories across all statements.”

Accounting rules “practically impossible to implement”, Barclays claims [Accountancy Age]
Barclays’ finance director, Chris Lucas isn’t too keen on these new loan valuation proposals. Besides the ‘practically impossible’ thing, he says, “The sensitivity disclosures…are highly subjective, difficult to interpret, and potentially misleading, particularly when the underlying data is itself highly subjective,” Lucas said.

“It is hard to see how sensitivity disclosures could be aggregated by a large institution to provide succinct data that avoids ‘boilerplate’ disclosure.”

Asking The Difficult Questions [Re: The Auditors]
“Audit committees too often rely on the auditors’ required disclosures without comment. They sometimes lack the independence, experience, or determination to ask the probing questions. It’s critical, however, that committees seek answers to vexing questions and not accept the response, ‘But that’s the way management has always done it.’ “

Buffett Donates $1.6 Billion in Biggest Gift Since 2008 Crisis [Bloomberg]
WB continues his plan of giving away 99% of his fortune, “[Buffet] made his largest donation since the 2008 financial crisis after profits at his Berkshire Hathaway Inc. jumped.

The value of Buffett’s annual gift to the foundation established by Bill Gates rose 28 percent to $1.6 billion from $1.25 billion last year. The donation, made in Berkshire Class B stock, was accompanied by gifts totaling $328 million in shares to three charities run by Buffett’s children and another named for his late first wife, according to a July 2 filing.”

The case for cloud accounting [AccMan]
Dennis Howlett continues to provide evidence that switching to the cloud provides benefits that are simply too big to ignore, “This 2min 1 sec video neatly encapsulates why this is something you should be considering, especially if you are operating electronic CRM or e-commerce for front of house activities.”