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TEC Initiatives Editor:
Editors note: Professor Purcell is Vice Chair of the AICPA Tax Divisions Tax Executive Committee. DC Currents is designed to heighten awareness of the AICPA Tax Divisions work and keep readers apprised of Division activities involving tax policy, technical issues and other practice support matters. As a senior technical committee of the AICPA, the Tax Exe-cutive Committee (TEC) is authorized to speak for it on tax matters, and is also designated by governing Council as a standard-setting body. However, numerous other committees, technical resource panels (TRPs) and task forces initiate and develop proposed solutions to policy issues and technical and tax administration problems, for the TECs consideration and approval. They also initiate proposals for products and services that add value for members in tax practice. Since the last cut-off date for this column (Sept. 15, 2003; see Purcell, TEC Initiatives, TTA, November 2003), the TEC met once (Nov. 910, 2003) and exercised its review function on several projects. TEC actions taken after Dec. 1, 2003 will be reported in a future column.
Tax Division Administrative Issues The TEC began implementing the Tax Section strategic plan at its November 2003 meeting. The plan emphasizes protecting the public interest, by stressing three elements: (1) ethics; (2) product and service delivery to members; and (3) Washington, DC, representation. The final plan was published in the January 2004 issue of the Tax Section Newsletter and is also available at www.aicpa.org/members/div/tax/index.htm.
Self-Governance Activities At its August 2003 meeting, the TEC approved the comments received on the exposure draft of Statements on Standards for Tax Services Inter-pretation 1-2, Tax Planning (available at www.aicpa.org/download/tax/ed_021111_interp_1-2.pdf). The Interpretation (together with an explanatory article) was published in the December 2003 issue of the Journal of Accountancy (JOA) and became enforceable on Dec. 31, 2003; see Karl, Tax Planning Services for Clients or Employers, JOA, December 2003. In November 2003, the TEC formed a task force to consider how actions taken by the IRS Office of Professional Responsibility (formerly, the IRS Director of Practice) should be integrated with the AICPAs new automatic sanctioning procedures.
Technical Activities Tax practice: Tax Committees and TRPs continue to publish tax practice guides and checklists for use by tax advisers during busy season. They are posted to www.cpa2biz.com when completed. In addition, Tax Section members receive annually, in January, a CD-ROM that contains guides that have been distributed to members throughout the prior year. Tax shelters: The TEC continues to monitor developments in the tax shelter area. Conversations with Treasury representatives and Congressional staff indicate favorable reaction to the tax shelter letter the Tax Division submitted on Sept. 2, 2003 (available at www.aicpa.org/download/members/div/tax/grassley_letter.pdf). That letter strongly supported the approach to curtailing tax shelter abuses expressed in HR 2896, the American Jobs Creation Act of 2003. At press time, no proposed legislation containing tax shelter regulation has passed Congress. The Task Shelter Task Force (co-chaired by Harvey Coustan and David Lifson) remains intact and currently is considering the effect of contingent fees in this area. Offers-in-compromise: The TEC, in a letter dated Oct. 14, 2003, offered comments to the IRS on the Offers-in-Compromise (OIC) program; see www.aicpa.org/download/tax/OIC-letter.pdf. The comments, prepared by the Tax Practice and Procedures Committee, shared the results of a survey indicating that responding CPAs perceive the IRS as predisposed to reject legitimate OICs. The letter strongly supported the IRSs efforts to make the OIC program more effective and offered suggestions for improvement. Fiscal year-end: The TEC continued its efforts to convince Congress to provide fiscal-year flexibility for small business start-ups (as a partial solution to workload compression). The Fiscal Year Flexibility Task Force (chaired by David Lifson) collaborated with Rep. Clay Shaws (R-FL) legislative director in developing the specific language of HR 3225, the Small Business Tax Flexibility Act of 2003, which Rep. Shaw drafted and introduced Oct. 1, 2003. In addition, the Task Force held meetings with Treasury to discuss the bills policy implications and with the Joint Committee on Taxation (JCT) to discuss both policy and revenue estimate assumptions. Further action on the bill awaits the results of a formal revenue estimate (requested by Rep. Shaw) from the JCT staff. Tax simplification: The TEC continues to collaborate with the American Bar Association and the Tax Executives Institute in fostering greater simplicity in the tax system. To that end, at the November 2003 Fall Tax Division Meeting in Washington, DC, each committee and TRP was asked to identify regulations in their technical areas that might be simplified without compromising the underlying tax policy. The objective is to submit a joint list to Treasury before the start of the 20042005 Regulatory Business Plan year (which begins July 1, 2004).
Conclusion Through its various task forces, TRP and committees, the TEC continues to monitor numerous other projects. The TEC and other Tax Division committees are committed to providing the best service possible to AICPA members. Leadership and membership appointments for committees and TRPs for the current committee year (which started Oct. 19, 2300) have been completed. However, members who would like to volunteer to assist in Tax Division activities (such as task forces or future appointed service) should contact Ed Karl at (202) 434-9228 or ekarl@aicpa.org. Members having suggestions for new services or products should contact Bill Stromsem at (202) 434-9227 or wstromsem@aicpa.org. |
