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AICPA CAUTIONS ON FUNDING FOR UNEMPLOYMENT BENEFITS

 AICPA CAUTIONS ON FUNDING FOR UNEMPLOYMENT BENEFITS
 WASHINGTON, Jan. 27 /PRNewswire/ -- In a letter to Ways and Means


Committee Chairman Dan Rostenkowski, the American Institute of CPAs (AICPA) cautioned the Congress not to make the same mistake it did when funding the first extension of unemployment benefits last November. Rather than using the estimated tax system to fund benefits, the CPAs support the proposed use of the unemployment trust fund, which has sufficient money available to fund a proposed extension of unemployment compensation benefits.
 The letter to Rostenkowski, from AICPA Chairman Gerald A. Polansky, also urged the lawmakers to use H.R. 4095, the bill to fund the second extension, to "...correct the inoperable legislation enacted in November 1991," and suggested that both benefit extensions could be funded from the trust fund.
 Copies of the AICPA's letter were also sent on Friday, Jan. 24, to other congressional leaders, members of the House Ways and Means Committee and the Senate Finance Committee and the Joint Committee on Taxation. A similar letter was sent to President Bush.
 AICPA has taken the position that the November 1991 procedures, which called for certain individuals to estimate their 1992 income taxes based on incomplete or inadequate information, are "extremely complex" and an "administrative burden to many taxpayers."
 The AICPA is the national professional organization of CPAs with 305,000 members.
 The complete text of Polansky's letter to Rostenkowski follows:
 With reference to the Rostenkowski-Downey Bill, H.R. 4095, we are pleased to see that the second extension of unemployment compensation benefits are not to be funded from the estimated income tax system.
 On Nov. 14, 1991, we expressed to the Congress our grave concerns with the proposed use of the estimated tax system to fund the first extension of unemployment compensation. In the intervening weeks, we have learned that even our worst fears were understated. The changes in the estimated tax laws, as enacted in November 1991, are simply not workable. They will make it literally impossible for taxpayers to comply, and thus the anticipated revenue is not likely to be realized. Furthermore, this will further erode public confidence in our tax law and will especially damage the integrity of the estimated tax system.
 We strongly urge that you use H.R. 4095 as a vehicle to correct the inoperable legislation enacted in November 1991. Perhaps both extensions could be paid for out of the trust fund. If that is not feasible, then some workable mechanism must be found. For example, if last year's AGI exceeded $75,000, then the current year's estimate could be based on a percentage of last year's actual tax. We have developed other ways to retain the certainty and simplicity of the estimated tax rules, and we would be pleased to discuss them at your convenience.
 -0- 1/27/92
 /CONTACT: Sam Hoyt of American Institute of Certified Public Accountants, 212-575-3879/ CO: American Institute of Certified Public Accountants ST: District of Columbia IN: SU: LEG


CK-OS -- NY089 -- 3896 01/27/92 16:15 EST
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Date:Jan 27, 1992
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