AT&T Mobility, a unit of AT&T Inc., has agreed to pay as much as $76 million to settle a cellphone-tax lawsuit brought by Missouri municipalities against wireless carriers operating in the state, The Wall Street Journal reported.
The municipalities assert that they can levy on cellphone service a tax normally applied to utilities and traditional "landline" phone companies.
Verizon Wireless settled the lawsuit last September for $31.5 million. Both Verizon and AT&T agreed to start collecting the tax from their customers.
Tuesday, December 11, 2007
Monday, December 3, 2007
Security firm challenged on whether guards are contractors or employees for tax purposes
A congressional leader is looking into Blackwater Worldwide's practice of paying its guards as independent contractors and not withholding taxes, the Wall Street Journal reported today.
Rep. Henry Waxman (D-Calif.), chair of the House Oversight and Government Reform Committee, wrote in an Oct. 22 letter to Blackwater that he believes the company "may have avoided paying millions of dollars in Social Security, Medicare, unemployment, and related taxes for which it is legally responsible," according to the Journal.
Blackwater, which provides security for the U.S. government in Iraq and elsewhere, said its tax policy follows the law.
Rep. Henry Waxman (D-Calif.), chair of the House Oversight and Government Reform Committee, wrote in an Oct. 22 letter to Blackwater that he believes the company "may have avoided paying millions of dollars in Social Security, Medicare, unemployment, and related taxes for which it is legally responsible," according to the Journal.
Blackwater, which provides security for the U.S. government in Iraq and elsewhere, said its tax policy follows the law.
Monday, November 26, 2007
States and IRS join forces to crack down on employment-tax violations
The IRS recently signed information-sharing agreements with agencies in 29 states as part of an increased effort to uncover employment-tax violations.
One of the major issues is whether companies are correctly classifying independent contractors. Unlike for employees, companies don't withhold Social Security, payroll taxes or other taxes from independent contractors' pay.
The states that have signed the agreement so far are: Arizona, Arkansas, California, Colorado, Connecticut, Hawaii, Idaho, Kentucky, Louisiana, Maine, Massachusetts, Michigan, Minnesota, Nebraska, New Hampshire, New Jersey, New York, North Dakota, Ohio, Oklahoma, Rhode Island, South Carolina, South Dakota, Texas, Utah, Vermont, Virginia, Washington and Wisconsin.
One of the major issues is whether companies are correctly classifying independent contractors. Unlike for employees, companies don't withhold Social Security, payroll taxes or other taxes from independent contractors' pay.
The states that have signed the agreement so far are: Arizona, Arkansas, California, Colorado, Connecticut, Hawaii, Idaho, Kentucky, Louisiana, Maine, Massachusetts, Michigan, Minnesota, Nebraska, New Hampshire, New Jersey, New York, North Dakota, Ohio, Oklahoma, Rhode Island, South Carolina, South Dakota, Texas, Utah, Vermont, Virginia, Washington and Wisconsin.
Wednesday, November 21, 2007
Bush nominates new IRS chief
President Bush will nominate Douglas Shulman, vice chairman of the Financial Industry Regulatory Authority, to be commissioner of the Internal Revenue Service, the White House announced.
Previously, he was vice president of Darby Overseas Investments and chief of staff of the National Commission on Restructuring the Internal Revenue Service.
Linda Stiff has been acting commissioner since April when Commissioner Mark Everson resigned to become president and chief executive officer of the American Red Cross.
Previously, he was vice president of Darby Overseas Investments and chief of staff of the National Commission on Restructuring the Internal Revenue Service.
Linda Stiff has been acting commissioner since April when Commissioner Mark Everson resigned to become president and chief executive officer of the American Red Cross.
Monday, November 12, 2007
Nonprofits must meet new tax filing requirements
New rules require even the tiniest nonprofit to file disclosure statements online with the Internal Revenue Service by May 1, 2008 or face losing their tax-exemption.
The rules introduce a category of Form 990 filing called the 990-N, which applies to organizations with annual revenues from $1 to $25,000.
Bob Ottenhof, chief executive of GuideStar (guidestar.org), which posts reports on charity finances, told the New York Times that, "Most nonprofits are complying with the rules. The problem is with those whose primary goal is not providing charity, but using charities for personal gain or to avoid taxes improperly.”
The rules introduce a category of Form 990 filing called the 990-N, which applies to organizations with annual revenues from $1 to $25,000.
Bob Ottenhof, chief executive of GuideStar (guidestar.org), which posts reports on charity finances, told the New York Times that, "Most nonprofits are complying with the rules. The problem is with those whose primary goal is not providing charity, but using charities for personal gain or to avoid taxes improperly.”
Friday, October 12, 2007
Trial of former KPMG executives set to begin
The trial of three former KPMG executives and an attorney on tax fraud charges is scheduled to begin Oct. 23.
"A victory for the government could bolster its broad probe into abusive tax shelters," says The Wall Street Journal. "An acquittal may cause the government to re-think its strategy in future tax-shelter cases."
For background on the landmark case and a discussion of its impact, see the Journal.
"A victory for the government could bolster its broad probe into abusive tax shelters," says The Wall Street Journal. "An acquittal may cause the government to re-think its strategy in future tax-shelter cases."
For background on the landmark case and a discussion of its impact, see the Journal.
Monday, October 1, 2007
Senate committee reviews derivatives and hedge funds
The U.S. Senate Finance Committee is examining offshore hedge funds' use of derivatives as a way to avoid withholding taxes on U.S. stock dividends, The Wall Street Journal reported today.
The U.S. Treasury loses more than $1 billion in potential tax revenue each year through this practice, the Journal said. The finance committee review is part of an overall examination of the taxation of hedge funds and is in the preliminary stages.
The U.S. Treasury loses more than $1 billion in potential tax revenue each year through this practice, the Journal said. The finance committee review is part of an overall examination of the taxation of hedge funds and is in the preliminary stages.
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