CPA Cafe: August 2012

Friday, August 31, 2012

New IRS Website: Is It an Improvement?

The U.S. Internal Revenue Service (IRS) unveiled its new website Thursday after offering a sneak preview last week. The IRS says technological upgrades will help the agency deliver services at a faster pace.

The IRS redesigned the website after analyzing usage of the previous site, including the most visited pages and most used tools. The main nagivation was modified to reflect demand for critical information about filing, payments, refunds, credits and forms.

The new site also boasts expanded language options, offering content in Spanish, Chinese, Korean, Vietnamese and Russian.

The IRS plans to add new search capabilities to better tag and target content for more meaningful search results. The agency will also feature related forms and publications in a separate section in search results.

Another change to the website is the new promotional banner, which will put important information, updates and tools front and center.

What do you think? Is the new website a step up? Will search improvements help you and your clients find information more quickly?

Monday, August 27, 2012

Wednesday, August 22, 2012

Are Delinquent Taxes Enough to Deny a Business License?

Delinquent business taxes have created a stir in Norfolk, where the city's treasurer has demanded that the commissioner of revenue stop issuing licenses to businesses that are behind on municipal taxes.

According to The (Norfolk) Virginian-Pilot, Treasurer Thomas Moss, Jr., said that businesses with delinquent business taxes are operating illegally and accused Commissioner of Revenue Sharon McDonald of not enforcing city and state codes. Moss added that his office would apply business license payments from such businesses to any delinquent taxes owed, rather than to the license renewal.

McDonald declined comment and called the issue "another Virginian-Pilot manufactured 'he said/she said' story designed to create the appearance of conflict when, in fact, none exists."

Norfolk's City Council passed an ordinance in September that said the commissioner of revenue should not issue business licenses until it receives verification from the treasurer's office that the applicant is current on all taxes. The other cities in South Hampton Roads (Chesapeake, Portsmouth, Suffolk and Virginia Beach) all have similar ordinances, as does the Virginia state code.

What do you think? Is this an appropriate use of government power?

Friday, August 17, 2012

Monday, August 13, 2012

A Startup Dating Back to 1878?

“Man, U” have got to be kidding me!

When you think of startup companies, English soccer juggernaut Manchester United (Man U) probably isn’t the first organization that comes to mind. But the club is weighing the possibility of taking advantage of a U.S. law aimed at helping small companies gain access to capital.

Man U went public on the New York Stock Exchange on Aug. 10 and said in its IPO filing that it may take advantage of relaxed reporting and auditing requirements for so-called “emerging growth companies” enacted as part of the Jumpstart Our Business Startups Act (JOBS Act), which President Barack Obama signed into law in April. The bill provides exemptions for companies with less than $1 billion in annual revenue, a requirement Man U met during its last fiscal year.

Should Man U decide to take advantage of the relaxed requirements, the club would have to provide just two years of audited financial statements and two years of related disclosures and would be exempt from the auditor attestation requirement in its assessment of internal control over financial reporting. The club said in its filing that it would opt out of another provision of the JOBS Act that would have granted it an extension to comply with new or revised accounting standards.

Forbes ranks Man U as the world’s most valuable sports franchise at $2.23 billion, and the club’s website bills it as “the world’s most popular football team.” The club was founded in 1878 and has won a record 19 English league titles.

The VSCPA commented on the JOBS Act when it was under debate in Congress, expressing concern with exemptions included in the bill for certain companies and the effect those exemptions could have on public company financial reporting and the independent standard setting process for accounting standards.

(Also in the interest of full disclosure: your humble blogger is an Arsenal supporter. Expect much more vitriol on this topic if Robin van Persie winds up at Man U.)

Friday, August 10, 2012

Thursday, August 9, 2012

VSCPA Members Appointed to Virginia Board of Accountancy

Virginia Gov. Bob McDonnell recently appointed two VSCPA members to the Virginia Board of Accountancy (VBOA) — Stephanie Saunders, CPA, a small practitioner from Virginia Beach, and Marc Moyers, CPA, a KPMG partner from Richmond. These appointments are another win for the VBOA, Virginia CPAs and the citizens of the Commonwealth. Stephanie and Marc bring a wealth of experience and service to the profession and the public it serves, and they will bring a fair and open-minded approach to regulating the CPA profession in Virginia.

For many years, the VSCPA has enjoyed a positive, cooperative relationship with the VBOA. While we always recognize the differences in our purposes and roles, we also recognize the need to understand each other, to sit down and discuss issues facing the profession, and to find common initiatives to promote together.

One way we collaborate is through the CPA Inauguration, an event we hold twice a year to recognize and celebrate new CPAs entering the profession. Both organizations understand the importance of reaching out to new CPAs to help them understand the profession they are entering and the rewards and responsibilities the profession will bring.

The VSCPA and the VBOA also work together to communicate important professional information to students and CPAs across the state. We have jointly presented on professional and licensure topics to accounting classes, and we frequently present sessions for CPAs on recent changes and information regarding their license.

Finally, the VSCPA serves as a vehicle for CPAs’ voices to be heard as the VBOA discusses and debates new rules and regulations — members and staff attend all VBOA meetings, and the VBOA is always open to hearing the VSCPA’s thoughts, ideas and viewpoints.

We look forward to continuing a great working relationship with the newest VBOA members, and, as always, we will continue to keep members informed of all activities related to the VBOA and CPA licensure requirements in Virginia.

Friday, August 3, 2012

Thursday, August 2, 2012

Go for the Gold — and Pay the Tax Man

With the London Olympics in full swing, many Americans are glued to their televisions, cheering on the gold medal-winning likes of Michael Phelps, Missy Franklin and Virginia Beach's own Gabby Douglas. But do they realize the tax implications of those athletes' Olympic glory?

Americans for Tax Reform (ATR) appears to be the original source for a story that's gone viral in Olympic- and tax-related media. The advocacy group calculated the tax bills for the honorariums medalists receive ($25,000 for gold, $15,000 for silver and $10,000 for bronze). The ATR tabulated the tax hits on those prizes as $8,986 for gold, $5,385 for silver and $3,500 for bronze.

Weekly Standard blogger Jonathan V. Last ran the numbers for Franklin, a high school student from California who won swimming gold in the 4x200-meter freestyle relay and the 100-meter backstroke and bronze in the 4x100-meter freestyle relay. (She's got three events left on her schedule). Last calculated that Franklin already owes nearly $14,000 in taxes for her medals, and she could hit the $30,000 mark with more golds.

There's a way for Franklin to get around the tax bill, and she might have to do it to keep competing as an amateur. If she follows through on her plan to compete in college, she'll have to decline the prize money in order to maintain her eligibility.

The ATR also noted that there's a more modest tax on the medals themselves based on commodity prices. The tax hit is $236 for a gold medal, $135 for silver and $2 for bronze. (Those numbers are included in the figures provided by the ATR.)

Sen. Marco Rubio (R-Fla.) proposed a bill on Wednesday that would exempt athletes from the federal tax.