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AICPA comments on proposed tax legislation, expresses deep concern over certain provisions.

The AICPA sent Congress a comment letter on several revenue provisions contained in S. 2020, the Tax Relief Act of 2005. Our comments related specifically to the bill's Sec. 501, Understatement of taxpayer's liability by income tax return preparer; Sec. 511. Clarification of economic substance doctrine: and Sec. 523, Partial payments required with submission of offers-in-compromise.

The AICPA has a clear position on abusive tax transactions--they should be eradicated. However, the Institute believes Sec. 501 and Sec. 511 are counterproductive, and strongly supported their elimination in conference. Doing so would still allow tax administrators to move forward productively to curb abuses while retaining taxpayers' respect for the tax system. The AICPA said it firmly believes Sec. 501 and Sec. 511 would have long-term, negative effects on both taxpayers and the government.

"We appreciate the opportunity to continue working with Congress, the Treasury Department, and the IRS to reach our common goals of eliminating abuse of our tax laws and ensuring that sanctions will be imposed appropriately on abusive transactions," wrote the A[CPA. "Taxpayers deserve to pay only their fair share of taxes and should not have to assume the cost of abuse. At the same time, we must assure the system operates equitably and with adequate due process. Hence, the AICPA has also voiced its concern about the negative impact that Sec. 523 will have on the future viability of the overall offer program."
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Title Annotation:tax info
Publication:CPA Letter
Date:Feb 1, 2006
Words:235
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