House Speaker Kirk Adams said Friday he fully expects legislation to come forward in the next session that will address Arizona’s Private School Tuition Tax Credits.House Speaker Kirk Adams said Friday he fully expects legislation to come forward in the next session that will address Arizona’s Private School Tuition Tax Credits.

Last week, Adams, R-Mesa, announced the creation of the official House task force to examine the tax credit law. The committee is made up of Republicans and Democrats from the Ways and Means committee. Rep. Rick Murphy, R-Glendale, is chairman.

Arizona law allows individual taxpayers to receive a state tax credit of up to $1,000 a year for a donation to a school tuition organization (STO), a 501(c)3 charity under federal tax law. STOs then give scholarships to students attending private schools or to students with special needs attending preschool programs.

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Those who have used offshore bank accounts in order to evade taxes are receiving more time to do so under a one-time extension of an IRS leniency program. The official announcement is set for today.

The program was initially expiring on Wednesday will allegedly continue until Oct. 15 according to USA today.

The IRS approved the continuation in response to requests from lawyers and tax preparers who told the agency they have been overwhelmed with late-filing applicants, the officials said. The IRS has had to reassign employees to handle an application surge since the program began in March.

Offshore account owners approved for the program by the IRS generally avoid criminal prosecution and pay:

• Back taxes and interest for a minimum of six years.

• A 25% delinquency penalty for each year in which tax returns weren’t filed, or a 20% accuracy penalty for years in which returns were filed but offshore income was omitted.

• A penalty equal to 20% of the highest aggregate value at any point during the last six years for all previously secret accounts.

Ordinarily, the IRS could impose penalties of at least 50% for all years in which an account wasn’t disclosed. In some cases, that could exceed the value of the offshore holdings.

If you are thinking of applying yourself, I urge you to contact a Tax lawyer to talk about your specific circumstances. Try browsing the tax lawyer directory.

With confusion gambling laws in many states, North Dakota may have the most confusing of all the gambling tax laws across the country. They may be changing.

The goal of changing the laws is to make it easier on charitable organizations when it comes time to pay gambling taxes. Gaming Dinision Director Keith Lauer thinks he has the solution and it comes in the form of one tax rate.

“North Dakota certainly needs an overhaul of their taxing system when it comes to their gambling revenue,” said CGW Business analyst Grant Davis, “These organizzations have no idea whether they are paying the right amount of taxes because of all the hoops they have to jump through just to arrive at a figure.”

The current system calls for charitable organizations in North Dakota to pay both excise taxes and a graduated tax on pull tab gambling tickets. Bingo tickets are also taxed in the same fashion.

North Dakota lawmakers could figure out what the percentages are that are being paid currently, and then come up with one base tax rate.

I think the idea is interesting. I would like to see the affect, if any, this has on the numbers

The first training seminar regarding the new sales tax law for businesses will be held Monday at the Augusta Civic Center.

Recent legislation has made a number of changes to the sales, use, and service provider tax laws.

The Maine Revenue Service is holding a number of seminars for business owners to explain the changes.

Monday’s sessions will be first at 1pm and then again at 6pm.

Maine tax litigation is a complex process only to be handled by an expert Maine Tax Attorney.

More than 150 UBS AG clients in the U.S. are under investigation for concealing income and assets offshore at the bank, a prosecutor said in a court filing.

The scope of the investigation was disclosed today in a memo recommending that former UBS banker Bradley Birkenfeld serve 30 months in prison for conspiring to help wealthy Americans evade taxes. Birkenfeld, who faces as long as five years, will be sentenced Aug. 21 in Fort Lauderdale, Florida.

Birkenfeld, 44, pleaded guilty in June 2008 to conspiracy, saying he helped U.S. clients evade taxes through Zurich-based UBS. He seeks leniency for helping a worldwide tax-fraud probe. UBS agreed Feb. 18 to pay $780 million to avoid prosecution for helping wealthy Americans evade taxes. The bank gave account data on 250 clients to the U.S. Internal Revenue Service.

“Ultimately, based upon information obtained from UBS as part of the deferred-prosecution agreement, the United States is criminally investigating more than 150 Americans across the country who are believed to have concealed income and assets at UBS, in violation of United States law,” acting U.S. Attorney Jeffrey Sloman said in the filing.

Three UBS clients pleaded guilty since the agreement to filing false tax returns, and a fourth was charged last week with failing to file a tax report for an offshore account.

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Q: I received a letter from my husband’s employer that I may be eligible for subsidized COBRA tax payments as a result of tax law changes.

I have been on COBRA since January of this year, as my husband no longer works.

How do the tax law changes work? Does eligibility depend on income or assets?

– Annie

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The IRS defended its proposals to enforce a law that taxes personal use of employer-provided cellphones, saying the changes are aimed at helping businesses comply, not taxing individuals.

Dow Jones Newswires reported Thursday that an IRS proposal released this week could wind up taxing employees on 25% of the value of their work cellphone. The IRS notice was meant to make it easier to enforce a 1989 law that treats employer-provided cellphones as a taxable fringe benefit.

A senior IRS official Friday said the agency is more concerned about making sure employers deduct the correct amounts for cellphone equipment and services provided to employees, than it is about taxing those employees on benefits.

"The motivation for the notice is to clarify how employers can justify a deduction. It wasn't aimed at employees," the official told Dow Jones in a telephone interview.

The IRS notice dated June 8 discusses tax implications of employer-provided cellphones both for the employer and the employee.

Marianna Dyson, a lawyer at Miller and Chevalier who specializes in the taxation of employee benefits, said that as a practical matter, the IRS proposals would affect both the business and the employee.

For instance, if IRS implemented its proposal to limit business deductions to 75% of the value of the employer-provided cellphones, and deem the rest personal use, the remaining 25% would have to be counted in an employee's gross income.

That would trigger both income tax and payroll tax withholding requirements on the employee's wages.

"If they decide 25% is personal use, guess what? It is a wage, and you have to withhold on it," Ms. Dyson said. "For IRS to suggest this would have no impact on employees, is a little disingenuous."

Ms. Dyson also noted that the IRS Notice does not address how self-employed individuals should handle deducting cellphone expenses.

"Right now, self-employed people have to document every single business call. They are driving around with one hand on the wheel and one on the phone and one in the log book," said Ms. Dyson.

"This doesn't do anything for them," she noted.

The IRS official said the requirement that cellphones be treated as fringe benefits is outdated, and could place a burden on employers. The 1989 law provides that the value of cellphone services can be excluded from an employee's gross income, and can be a deductible expense to the employer, only if the employee keeps strict records showing that the phone was used for work only.

"At the time this was enacted, every single call cost $4 or $5. That is not the world we live in anymore," the official said. "We've been hearing from companies that [the requirement] is too burdensome. We needed to think about how we could make it less expensive," the official said.

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The General Assembly on Monday approved changing the state's tax law with hopes it will result in Apple Inc. announcing a $1 billion investment within days.

The Senate voted 40-8 to go along with conditions including that the company invest in a rural area. The final round of debate lasted less than a minute.

Sen. Tom Apodaca, R-Henderson, urged rejection. He had previously lambasted business recruiters and lawmakers for focusing on high-profile, big companies and ignoring small businesses. Sen. David Hoyle, R-Gaston, said small companies near the site of a promised data center would benefit by providing services.

"There is a lot in this for small businesses," Hoyle said.

The legislation was sent to Gov. Beverly Perdue, who was expected to sign the bill into law quickly.

An Apple spokeswoman said the company had no comment.

The bill would give the qualifying company a break on state corporate income taxes. The tax break could be worth about $46 million in the next decade, assuming the lone, unnamed company projected to qualify reaches its $1 billion investment target within nine years of starting, according to a memo by legislative fiscal staffers.

The Associated Press reported last month that the unidentified company being targeted by the tax break is Apple, which is seeking a site for its East Coast data warehouse. These facilities, also called server farms, are huge, climate-controlled computer warehouses that can process vast flows of data needed as business functions and everyday life increasingly depend on Internet traffic.

Data centers are heavy users of power and water and are usually spread over large spaces. Google Inc. opened one last year near Lenoir in the western North Carolina foothills. In 2007, state and local governments offered Google an incentives package worth up to $260 million over 30 years, one of the largest in state history, to land the $600 million data complex.

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A push for new taxes on soda, beer and wine to help pay for Americans’ health care is stirring up more than just the beverage industry.

Advertisers, corn refiners — even addiction treatment centers — have mobilized their lobbyists, reflecting how a tax increase for a handful of popular products can reverberate broadly across Washington’s interest groups.

The Senate Finance Committee is considering raising taxes on alcohol and imposing a new levy on soda and other naturally sweetened drinks to help pay for overhauling health care. The committee calls them “lifestyle tax proposals,” saying the levies would slow sales of unhealthy products that contribute to rising medical costs.

Soft drink and alcohol lobbyists have snapped into action, though so far their campaigns have been quiet compared to the blaring, multimillion-dollar battles that typify major showdowns.

Their low-key approach is due partly to committee leaders’ warnings to refrain from public attacks or be accused of sabotaging health care overhaul. They’ve also held back because they have faced only modest lobbying from tax proponents, and because they think the proposal may prove so unpopular that it ultimately won’t threaten their businesses.

“They don’t want to call attention to a quietly smoldering fire,” said Rogan Kersh, an associate dean at the Wagner School of Public Service at New York University.

Besides alcohol, drinks with sugar, high fructose corn syrup and similar sweeteners would be targeted, though diet drinks with artificial sweeteners would not. Other industries also are on alert, worried that the idea of “lifestyle taxes” could spread to other products deemed unhealthy.

“Are they going to hit couch manufacturers? School districts that have canceled physical education?” joked Neil Trautwein, health care lobbyist for the National Retail Federation, which opposes the plan and whose members include fast-food restaurants.

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In a policy change that could benefit thousands of people, the federal government announced Friday that its tax credit for first-time homebuyers can now be used to help pay closing costs on mortgages insured by the Federal Housing Administration.

The economic stimulus bill passed in February allows first-time homebuyers a tax credit equal to 10 percent of the home's purchase price or $8,000, whichever is less, when they file their federal income taxes. But under the plan announced Friday, buyers using FHA-insured loans will be allowed to treat the tax credit as additional down payment funds, or use it to pay for the closing costs that are typically incurred when a mortgage is funded.

"Families will now be able to apply their anticipated tax credit toward their home purchase right away," said Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development, which oversees FHA.

Donovan announced the new use for the home-buying tax credit at a meeting of the National Association of Home Builders' board of directors, in Washington, D.C.

He also said the government is putting "safeguards in place" to ensure that lenders who are offering the tax-credit advances are not charging "excessive" fees for the service. In a letter to FHA-approved lenders, the agency said fees of more than 2.5 percent of the tax credit are excessive.

FHA loans are insured by the Federal Housing Administration and made through its approved lenders. The loans, whose upper limit is $729,750 in Santa Clara County, typically have lower interest rates than traditional mortgages.

Only qualified buyers using FHA loans can use the tax credit toward down payment or closing costs. Other buyers can take the tax credit when they file their income tax returns.

A few weeks ago, the housing industry was abuzz with news that FHA might allow borrowers to use the tax credit to replace the 3.5 percent minimum down payment required for FHA-insured loans. But the government quickly backpedaled on that idea, which would have resulted in more no-money-down, foreclosure-prone mortgages.

Friday, Donovan specified that FHA borrowers will still need to make down payments of at least 3.5 percent of a home's purchase price. But the tax credit can be used as an additional down payment amount, which may help borrowers secure a lower interest rate on their loans. It may also be used to pay for closing costs — such as the fees charged for title searches or mortgage applications — which sometimes total thousands of dollars.

Local real estate agents said the change to the tax credit program will help the local housing market somewhat.

"Overall, it is a good thing," said Karl Lee, a Milpitas broker who is president-elect of the Santa Clara County Association of Realtors.

But the change won't affect the current market for bank-owned properties, he said. Recently in Santa Clara County, banked-owned, post-foreclosure properties have been garnering multiple purchase offers. And the banks prefer to accept offers on their "REO" (real-estate-owned) properties from non-FHA borrowers when possible, he said, because FHA loans usually take longer to close than traditional loans.

"It may not help with the REO piece of the market," he said of the new use for the tax credit, "but for the rest of the market it will be a positive impact."

The tax credit applies to home purchases that close before Dec. 1.

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