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Keeping CalCPA Members Connected and Informed

Archive for the ‘CalCPA Buzz’ Category

Trustee Nomination Period Open for Group Insurance Trust

October 21st, 2014

CalCPA Council will be nominating candidates to stand for election to serve three-year terms as trustees of the Group Insurance Trust. Additionally, participating GIT employers may nominate qualified individuals for the fall election by submitting supporting petitions from at least 20 firms participating in one or more of the GIT’s group health and welfare plans by Nov. 4. For more information, contact Genna Armanini at (800) 556-5771, ext. 3257, or via email.

New E-file Requirement for Business Entities

October 21st, 2014

Assembly Bill 2754 was recently signed into law. Beginning Jan. 1, for taxable years beginning on or after Jan. 1, 2014, any business entity that files an original or amended tax return prepared using tax preparation software is required to electronically file (e-file) their return with the FTB unless a waiver is obtained for the following reasons:

  • Technology constraints: The inability of the tax preparation software used by a taxpayer to electronically file the return due to the inadequacy of the software or the complex nature of the return;
  • Where compliance would result in undue financial burden; or
  • Circumstances that constitute reasonable cause and not willful neglect.

IRS Warning: Scams Designed to Steal FATCA Data

October 21st, 2014

The IRS issued a fraud alert for international financial institutions complying with the Foreign Account Tax Compliance Act (FATCA). Scam artists posing as the IRS have fraudulently solicited financial institutions seeking account holder identity and financial account information. The IRS does not require financial institutions to provide specific account holder identity information or financial account information over the phone or by fax or email. Further, the IRS does not solicit FATCA registration passwords or similar confidential account access information.

CPA Day Fast Approaching

October 21st, 2014

Jan. 21 will be the next CPA Day in Sacramento, and the time has come to register and make arrangements to represent yourself and your profession at the Capitol. Last year’s CPA Day was a big success. The halls of the Capitol were filled with CalCPA members discussing the importance of the profession in California, how CPAs can be resources for legislators and their constituents, and the important legislative issues that emerge each year.

Please join CalCPA this year again to ensure that your voice and the voice of the profession is heard by all the legislators. Register for CPA Day or learn more.

Upcoming Foundation Events: International Tax Conference Dec. 12

October 21st, 2014

Become a CalCPA Officer, Education Foundation Trustee

October 6th, 2014

California CPAs are the driving force behind one of the world’s largest economies. Isn’t it time you put your leadership skills to use for the betterment of the CPA profession?

The CalCPA Council/AICPA Council 2015-16 application period is open, as is the application period for CalCPA Education Foundation trustees.

More information, including position descriptions, nomination criteria and nomination form can be found online.

Both CalCPA officer and Foundation trustees nominations are due Dec. 1.

Professional Issues Updates: Tailored Topics

October 6th, 2014

The Professional Issues Update roadshow fosters a greater sense of information sharing among CPAs in your area—with a group of experts coming to your chapter, providing a customized update based on geographic, industry and professional trends.

CPA professionals, including CalCPA leadership, will cover tax issues, legislative and political activities, trends related to risks and liabilities for CPAs, a review of the Affordable Healthcare Act’s impact on employers and employees, as well as additional topics that are also being identified.

Register for your chapter’s update.

CAMICO Tip of the Month: Late Estate Tax Returns and Penalties

October 6th, 2014

The irregular filing due date for estate tax returns (Form 706), nine months after the decedent’s date of death, is the primary reason for missed estate tax return filings. Late filing penalties exceed $300,000 in some cases. CAMICO recommends the following loss prevention steps:

  1. Implement a due date tracking system for estate tax returns. The system can be as simple as a calendar devoted solely to estate tax return due dates.
  2. Have at least one person in the office be primarily responsible for tracking estate tax return filing deadlines (rather than having each tax partner or tax manager, etc., tracking his or her own deadlines).
  3. Continually review the due date tracking system to ensure that the firm meets any impending due dates the system identifies.

For more information about CPA firm insurance issues, call CAMICO at (800) 652-1772 or go online.

IRS May Not Be Collecting All Delinquent Taxes

October 6th, 2014

According to a report released by the Treasury Insector General for Tax Administration (TIGTA), the IRS may be missing opportunities to collect delinquent taxes because it is not always completely researching cases before closing them as uncollectible. If an IRS employee is unable to contact or unable to locate (UTC/UTL) a delinquent taxpayer, the collection case may be closed as currently not collectible (CNC). In the 2012 fiscal year, the IRS closed 482,611 tax modules involving approximately $6.7 billion as CNC–UTC/UTL.

TIGTA initiated an audit to determine whether the IRS was adequately researching, documenting and approving these cases to ensure that all actions were taken to collect outstanding taxpayer liabilities. TIGTA found that IRS employees did not always complete required actions before closing cases as CNC–UTC/UTL. Of a stratified sample of 250 cases TIGTA reviewed, there was no evidence that employees completed all of the required research steps for 57 percent of the cases prior to their closure.

New California Form FTB 3840, ‘California Like-kind Exchanges’

October 6th, 2014

For exchanges of property that occur in taxable years beginning on or after Jan. 1, 2014, California Revenue and Taxation Code Sections 18032 and 24953 require taxpayers who defer gain or loss under IRC Sec. 1031 by exchanging California property and acquiring out-of-state like-kind property to file an annual information return to report the exchange to us.

The new California Form FTB 3840, California Like-kind Exchanges, will be available on FTB’s website around the end of October to allow for public comment. The form will help taxpayers keep track of their California source deferred gains and meet their new reporting requirement. Form FTB 3840 provides information about the relinquished California properties and the non-California replacement properties in the like-kind exchange. Form FTB 3840 must be filed in the year in which the like-kind exchange is completed and each subsequent year that the gain or loss is deferred, regardless of whether the seller/exchanger has any other California filing requirement.

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