Latest news with #DepartmentOfTreasury
Yahoo
04-07-2025
- Business
- Yahoo
AICPA submits recommendations for transition to EFDS
The American Institute of CPAs (AICPA) has submitted recommendations to the Department of the Treasury concerning the transition to an electronic federal disbursements system (EFDS), as mandated by Executive Order 14247, Modernizing Payments To and From America's Bank Accounts. The order stipulates that all federal payments should be processed electronically by ceasing issuance of paper checks by 30 September 2025 and aims to enhance efficiency and security while reducing costs. The AICPA supports the move towards electronic payments but highlights the challenges it poses, particularly for taxpayers without a US bank account. This includes seniors and the unbanked population, who may be excluded from the system due to international banking regulations that restrict automated clearing house transfers with non-US financial institutions. The AICPA's letter references a Treasury Inspector General for Tax Administration report indicating that nearly seven million taxpayers received refunds through non-electronic means in the latest tax year. The AICPA's recommendations include exceptions for individuals and entities not based in the US or without a US bank account, and exemptions for temporary non-US individuals. It also suggests expanding the capabilities of the Electronic Federal Tax Payment System to allow business accounts to process payments on behalf of individuals, and delaying the implementation for trusts and estates until the IRS can address specific administrative issues. Furthermore, the AICPA proposes guidance for applying exceptions for qualified taxpayers, extending the timeframe for implementing the order, seeking statutory authority for the mandates, and involving stakeholders in establishing the rules for the transition. AICPA senior manager for Tax Policy & Advocacy Daniel Hauffe said: 'For many years, the AICPA has advocated for and supported the modernisation of the IRS and its payment systems; although this executive order is a step in the right direction, there are many considerations before implementing changes, which means updated processes and carefully tailored rules will need to be developed.' 'The AICPA's recommendations allow for the modernisation of the IRS' tax payment systems while mitigating the impact of the administrative burden on taxpayers, tax practitioners and the IRS, that could be caused by this executive order.' In June 2025, the AICPA also expressed concerns regarding the pass-through entity tax state and local tax (SALT) deductions in recent reconciliation bills. "AICPA submits recommendations for transition to EFDS" was originally created and published by The Accountant, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Gizmodo
27-06-2025
- Business
- Gizmodo
Silicon Valley Is Cashing Its Check After Backing Trump
The cost of living is increasing, wages for workers are stagnant, and people are looking for a break. Silicon Valley is getting one instead. According to Bloomberg, a little-known tax benefit known as the Qualified Small Business Stock (QSBS) that has become a favorite carve-out of tech startups would get expanded under a spending bill proposed by Republicans in the Senate and could potentially put more than $17 billion back in the coffers of Silicon Valley execs. The QSBS provision is a tax exemption that applies to the stock of qualified small businesses like certain tech startups. The rule allows shareholders in one of these businesses to sell or exchange their stock while being exempted from some or all of the capital gains tax that they would otherwise have to pay on those sales. The specifics are a bit complex, but currently, it is set up to allow early-stage investors to benefit if they hold onto their shares for five years. The proposed changes to the rule, per Bloomberg, would expand the benefit considerably. A provision slipped into the so-called 'One Big Beautiful Bill' would allow investors to come in later, cash out earlier, and still score a nice chunk of cash-free income off their investment. According to data from the Department of the Treasury, about 33,000 people have claimed the QSBS benefit in the last decade. They netted $51 billion in 2021 alone from it, which was a record year. Notably, the Treasury also found that 90% of the income claimed through QSBS came from taxpayers who were reporting more than $1 million of gains—basically, folks who are cashing out big time without paying anywhere near what an average person has to hand over to the federal government. The Treasury Department projects that the QSBS provision will keep about $44.6 billion from being taxed from 2025 to 2030. If the Republicans' proposal moves forward, that would add another projected $17.2 billion in revenue that doesn't come back to the government over that period, according to data provided by the Congressional Joint Committee on Taxation. According to The Guardian, Silicon Valley executives and employees poured about $394 million into Donald Trump's 2024 election campaign. So scoring $17.2 billion in tax breaks certainly seems worth the spend. That's a cool 4,265% return on investment! For what it's worth, Democratic lawmakers proposed significantly rolling back the QSBS rules back in 2021, in a way that would have slashed the amount of income that could be excluded from taxes in half. Instead, the rich get richer.
Bloomberg
26-06-2025
- Business
- Bloomberg
Sheinbaum Disputes US Money Laundering Claims Against Mexican Banks
Mexico's president responded defiantly to US measures that could cripple three prominent local banks on accusations of potential money laundering tied to drug trafficking, arguing she's seen no evidence to support the crackdown. President Claudia Sheinbaum told reporters that Mexican finance officials have found no proof of wrongdoing in their own investigations of the financial firms the US Department of Treasury accused of illicit activity.
Reuters
06-06-2025
- Business
- Reuters
US issues new Iran-related sanctions, Treasury website shows
WASHINGTON, June 6 (Reuters) - The United States has issued a new round of Iran-related sanctions targeting 10 individuals and 27 entities, according to a post on the U.S. Department of Treasury website on Friday. The sanctions, which also target some entities in the United Arab Emirates and Hong Kong, come as U.S. President Donald Trump's administration is working to get a new nuclear deal with Tehran.
Forbes
21-05-2025
- Business
- Forbes
3 Key Takeaways From The ‘No Tax On Tips' Act
IHOP (International House of Pancakes) Restaurant, April 9, 2011 in West Los Angeles, California. ... More (Photo by Bob Riha, Jr./Getty Images) As reported by Forbes, the Senate has unanimously passed the 'No Tax on Tips Act' in a unanimous vote. This bipartisan piece of legislation now heads to Trump's desk to be signed into law. This article highlights three key takeaways from the significant tax law change. The No Tax On Tips Act provides a tax deduction for cash tip wages reported to employers. However, there are key limitations. First, the amount that can be deducted is capped at $25,000. Thus, the bill actually means that some (rather than no taxes) will be paid on tips. Second, the deduction will not apply to taxpayers that earn more than $160,000. Third, the taxpayers who can take this deduction will be limited to certain occupations, which, according to The Guardian, will be provided by the US Department of Treasury within 90 days. The aim of these limitations is to limit loopholes. As I reported in Poole Thought Leadership, absent any limitations, high-earning individuals can game the system for their benefit. For instance, if the CEO of a company were to structure his or her's entire income as a tip, then, absent any limitations, he or she would be able to lower their tax liability considerably, even though the bill is not aimed at them. Given the limitations, the CEO would not be permitted any deduction because their occupation is not expected to be on the permitted list. The limitations also limit the wealthiest taxpayers from taking this deduction. Lastly, many tip-based taxpayers will not benefit from this bill because they make too little. With the 2025 standard deduction set at $15,000 for an individual taxpayer, Yahoo!News reports that 37% of tip-based taxpayers already pay no federal income taxes due to their taxable income already being less than the standard deduction. Once this bill is passed, according to the Institute on Taxation and Economic Policy, states must conform their income taxes to the federal level for the workers to be exempt from state income taxes. This means that state legislators must begin to act soon to limit the tax liability on tip income for affected employees. For instance, if a taxpayer were to be earning $100,000 in tip income, the employee's income after the deduction at the federal level would be $75,000. However, absent any conformity, the income in the eyes of the state where they reside would be $100,000. As some states tax income of $100,000 as high as 9.30%, the taxpayer can still be subject to significant state tax burdens. States like North Carolina are already moving forward with these actions. Thus, tip-based taxpayers will need to watch whether their state allows this deduction closely. While it is required under law for tip-based taxpayers to report their tip earnings for tax purposes, they also receive benefits for having these funds reported as income. For instance, if a tip-based employee were to be trying to get a loan for a house or a vehicle, they would need to have documented income to support the lending decision. Furthermore, many taxpayers set aside some of this income to contribute to Social Security or other retirement accounts like IRAs. Early on in the legislative process for the No Tax On Tips Act, it was unclear how exactly the tips would not be subject to taxation. Specifically, the bill could have exempted the taxation from income or the bill could provide a deduction from income. While both would have resulted in the same effect on the taxpayer's tax liability, a key nuance is that exempted income (depending on how it was exempted) could affect how external entities perceive it and would potentially affect the taxpayer's ability to contribute to retirement. According to Kiplinger, the version of the bill passed by the Senate sided with the latter, protecting the tip-based taxpayer's ability to contribute the full amount to Social Security.
