A Note from Ed Karl, VP - Taxation

November 20, 2015

Holidays are right around the corner and it feels like we want to put our feet up! But with so much going on in Washington, that’s just not going to happen. Changes in congressional leadership, a budget agreement, work on the highway funding bill, fiscal-year 2016 government appropriations, tax reform, changes in due dates, and tax extenders are all on the table. The connection to our membership on some of these items is obvious, such as tax extenders (which will happen) and tax reform (which won’t -at least not until 2017 at the earliest). Others, like the budget agreement and highway funding bill, contain tax-related “pay-fors” that could very well impact you and your clients. Our Tax Advocacy Team has pushed for extenders to be resolved timely as we know that resolution is critical to leveraging a timely start to the filing season. The good news is that it seems likely we will get a two-year extension – possibly a one-year retroactive extension – and a good chance that either one or the other will occur before Congress recesses on December 20.

The budget deal – the Bipartisan Budget Act of 2015 – contains a pay-for that significantly changes how the IRS would audit and collect liabilities resulting from audits of partnerships. Adjustments will generally be taken into account by the partnership but will provide an alternative option to pass changes through to the individuals; the bill repealed the TEFRA and Electing Large Partnership rules, and also permits small partnerships to opt out. This provision surfaced earlier in the year and AICPA efforts had a significant impact in mitigating problems with the earlier version – most notably the joint and several liability issue which would have had a chilling effect on the ability of partnerships to attract new partners.

So much other work goes on behind the scenes. A good example was last year’s situation where IRS shut down their modernized e-file system for maintenance over the Columbus Day holiday, and significantly impacted the last few days of the October 15 extension period. We heard loud and clear from you about the seriousness of that situation and funneling your concerns made a difference this year!

That partnership - leveraging our members’ experiences and our advocacy work - is critical to our overall success. Our tax advocacy and tax member service teams work together every day to understand  our members’ experiences to solve problems both from a legislative or regulatory perspective, but also to make sure that you have the tools and information necessary to be successful in your practices and businesses. And it goes both ways. Our member service-related and tax advocacy-related efforts fuel each other.

Some terrific resources just released to members include our Tax Practitioner’s Toolkit which provides rich resources to educate clients and others on important issues, as well as ID theft resources. There’s so much more there just waiting for you to tap into in the Tax Interest Area.

So with the holidays almost upon us, I wish you the happiest of times, a healthy new year, and a successful filing season. Just know that we have your back – supporting you with guidance, tools, and resources as well as advocating on your behalf to make sure that CPAs are the most trusted, preeminent providers of tax services!