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TEC Initiatives
Editor:
Editors note: Prof. 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 Executive 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 (June 9, 2003; see Purcell, TEC Initiatives, TTA, August 2003, p. 497), the TEC met once (Aug. 2122, 2003) and exercised its review function on several projects. TEC actions taken after Sept. 15, 2003 will be reported in a future column.
Tax Division Administrative Issues The TEC modified strategies and tactics and adopted a proposed strategic plan for the Tax Division (as discussed by the TEC at its June 2003 meeting). The final plan will be discussed within the AICPA and shared with the membership over the next few months.
Self-Governance Activities At its August 2003 meeting, the TEC discussed the comments received on the exposure draft of Statements on Standards for Tax Services Interpretation 1-2, Tax Planning. The draft can be found at www.aicpa.org/members/div/tax/sstsint.asp. After reviewing the public comments, the TEC modified Interpretation 1-2 and approved it as amended.
Technical Activities Tax practice: The TEC, in conjunction with several other groups, sent a letter on July 9, 2003 to members of the Senate Finance Committee, expressing concern with the provision in HR 1528, the Taxpayer Protection and IRS Accountability Act of 2003, that would change the due date for electronically filed returns to April 30. The letter reiterated the AICPAs support for electronic filing, but indicated that the proposed due date would (1) cause taxpayer confusion, (2) not solve the need for extensions for electronic filers and (3) not address state compliance and estimated tax problems. Tax shelters: In a letter dated Aug. 7, 2003, the TEC responded to the Treasurys request for further comments on the confidential transactions category contained in TD 9046, the final regulations involving disclosure (Sec. 6011), registration (Sec. 6111) and list maintenance (Sec. 6112) for reportable transactions. The comments, prepared by the IRS Practice and Procedures Committee (chaired by Jim Dougherty), requested further clarification about which transactions should be treated as exceptions to the confidential transactions category, and strongly encouraged Treasury and the IRS to issue a revenue procedure detailing exceptions to that category, consistent with the revenue procedures already released on loss transactions and book-tax differences. On Sept. 2, 2003, the TEC wrote to the leadership of the House Ways and Means Committee and the Senate Finance Committee, strongly supporting the approach to curtailing tax shelter abuses expressed in HR 2896, the American Jobs Creation Act of 2003. It noted that earlier proposalswhich would have (1) codified the economic-substance doctrine and (2) raised the tax return standard (for both taxpayers and preparers) to more likely than not for all tax return positionswere not included in the bill or the draft amendment. The TEC strongly supported their elimination; legislation without those proposals will provide a better basis for tax administrators to move forward productively to curb abuses of our tax system, while retaining taxpayers respect for that system. The TEC firmly believes that these provisions would have had long-term, negative effects on both taxpayers and the government. The text of the letter is available at www.aicpa.org/download/members/div/tax/grassley_letter.pdf. Tax accounting: On Sept. 10, 2003, the TEC submitted comments (prepared by the Tax Accounting TRP, chaired by Bob Kilinskis) to the IRS on the proposed changes to Regs. Sec. 1.61-8(b). The changes would modify the long-standing rules on advanced payments received for goods. Partnerships: On July 23, 2003, the TEC submitted a letter to the Ways and Means Committee, proposing compliance changes in partnership taxation that would address situations in which partners dispose of partnership interests and the partnership asset mix includes Sec. 751 hot assets (e.g., accounts receivable). The comments, prepared by the Partnership Taxation TRP (chaired by Betsy Case), contained proposed statutory language that would implement the compliance changes.
Employee benefits:
On June 27, 2003, the TEC submitted comments to the IRS on the proposed
regulations addressing deemed IRAs in qualified plans. The comments,
prepared by the Employee Benefits TRP (chaired by Carol Zurcher), may be
found at
www.aicpa.org/download/tax/
Conclusion
Through its various task
forces, TRPs and committees, the TEC 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) 4349228 or ekarl@aicpa.org. Members having suggestions for new services or products should contact Bill Stromsem at (202) 434-9227 or wstromsem@aicpa.org . |
