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The Internal Revenue Service (IRS) is currently processing around 400,000 claims for the Employee Retention Credit (ERC), amounting to approximately $10bn in eligible claims. Commissioner Danny Werfel stated: "In recent weeks, the IRS has made substantial progress in separating eligible claims from the wave of ineligible claims." The agency is addressing a significant number of claims that were submitted during a time of aggressive marketing by promoters, which led to many improper claims. It is intensifying audits and investigations into potential fraud while also offering a supplemental claim process to assist third-party payers. The second Employee Retention Credit Voluntary Disclosure Program is set to conclude on November 22nd.

 

Accounting Today

Boston Mayor Michelle Wu is advocating for a temporary increase in the city's commercial property tax rate to alleviate a projected 14% rise in residential property taxes next year. Ms. Wu argues that the measure is essential to prevent homeowners from facing a 28% quarterly tax hike in January. Currently, about 71% of Boston's budget relies on property taxes, and the pandemic has led to high office vacancy rates, impacting commercial property values. Despite the potential benefits for homeowners, the plan has faced significant opposition from business and real estate groups, who warn it could harm small businesses. The plan requires approval from state Senators and the governor by late November to avoid larger tax hikes for residents.

 

Boston Globe

Approximately 1m residents in New Jersey have received their ANCHOR benefits, according to state officials. The Treasury Department reported that over 900,000 payments were sent via direct deposit on October 10th, with an additional 100,000 checks mailed on October 11th. Most payments were issued to individuals whose applications were automatically filed by the state, although not all recipients of the notification letter received benefits. The Treasury Department said: “Payments will be distributed on a rolling basis until all eligible applicants receive their benefit.” Eligible homeowners can receive up to $1,500, while renters can get $450, with senior homeowners and renters receiving an extra $250. The deadline for new applications is November 30th. The IRS has also announced disaster tax relief for individuals and businesses of the San Carlos Apache Tribe in Arizona, impacted by the Watch Fire that started on July 10th 2024. Affected taxpayers now have until February 3rd 2025 to file various federal individual and business tax returns and make tax payments. This initiative aims to alleviate the financial burden on those affected by the disaster.

 

NJ.com

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The accounting profession is grappling with significant challenges in talent acquisition and retention. Despite increasing salaries and the integration of artificial intelligence to address staffing shortages, experts emphasize that a fundamental shift is necessary to attract the next generation. Current average starting salaries for accounting majors are around $65,000, which lags behind those in technology and finance. Paul Miller, a CPA and managing partner at Miller & Company, said: "The industry as a whole is not attractive to the younger population." Additionally, leaders are exploring how to effectively implement AI without displacing entry-level roles. Shagun Malhotra, chief executive of Skystem, suggested that enhancing accounting education to focus more on technology could make the field more appealing. Elizabeth Beastrom, president of Thomson Reuters Tax & Accounting, highlighted the issue of burnout due to excessive workloads, saying: "We've asked tax and accounting professionals to do too much with too few resources for too long."

 

Accounting Today

EY's global revenue increased by 3.9% to $51.2bn in the year ending June, marking the slowest growth in over a decade. Janet Truncale, global chair and chief executive of EY, stated: "Over the past year, EY teams have demonstrated extraordinary resilience in a challenging economic climate." The consulting sector, traditionally a growth driver, saw fees stagnate at $15.6bn, while audit and tax services grew by 6.3% each, contributing significantly to overall revenue. The firm also reduced its workforce for the first time in 14 years, employing 392,995 people, down from 395,442. The weakest performance was in Asia, where fees remained flat at $7.2bn, while growth was noted in the Americas and Europe, the Middle East, India, and Africa.

 

Bloomberg Tax

Financial Times

The Times of London

BDO USA has partnered with Everlaw, a cloud-native investigation and litigation platform, to enhance e-discovery and litigation support globally. This collaboration aims to provide legal departments and law firms worldwide with advanced tools to navigate complex data landscapes effectively. “Our clients depend on us to help them uncover relevant facts for litigation, regulatory, and compliance matters – separating the signal from the noise", said BDO E-Discovery Managed Services team principal and leader Daniel Gold. “Everlaw is an ideal addition to our suite of tools, permitting BDO to efficiently tackle the toughest data challenges and deliver optimal outcomes for our clients."

 

International Accounting Bulletin

In September, retail sales in the U.S. grew by 0.4% on the month, according to the Commerce Department, marking their third consecutive monthly rise, with low unemployment and steady income growth encouraging consumer spending. Analysts polled by Dow Jones expected a 0.3% rise. On an annual basis, sales grew 1.7%. Spending grew at miscellaneous store retailers, which showed an increase of 4%, as well as at clothing stores (1.5%) and bars and restaurants (1%). However, they declined 3.3% at electronics and appliances stores, and 1.4% at furniture and home furnishing businesses. 

 

Bloomberg

CNBC

Los Angeles Times

Reuters

The Commerce Department has reported a 0.3% rise in U.S. business inventories in August, lifted by stocks at retailers. The increase in inventories, a key component of gross domestic product, was in line with economists' expectations. Inventories advanced 2.4% on a year-on-year basis. The report said retail inventories climbed by 0.6% during the month, while manufacturing and wholesale inventories both inched up by 0.1%. Separate Federal Reserve data showed a 0.3% fall in U.S. industrial production, which was hampered by Hurricanes Francine and Helene, as well as a strike at Boeing. The drop was slightly below expectations of a 0.2% fall, according to a Wall Street Journal survey of economists. Manufacturing was down 0.4% in September, the third decline in the past four months. Production of motor vehicles and parts fell 1.5% in September after a sharp 9.9% gain in the prior month. Excluding autos, total industrial production was down 0.2%. Capacity utilization declined 1.3 points to 77.5%.

 

Bloomberg

MSN

Nasdaq

Reuters

Initial jobless claims retreated by 19,000 to 241,000 in the seven days to October 12th, the Labor Department reported Thursday. Economists polled by the Wall Street Journal had estimated new claims would rise by 2,000 to 260,000. Claims had jumped to more than a one-year high in the prior week, attributed to Hurricane Helene, which devastated Florida and large swathes of the U.S. Southeast in late September. The four-week moving average of new applications rose to 236,250, the highest since August, while continuing claims, reported with a one-week lag, inched up 9,000 to around 1.87m. 

 

ABC News

Bloomberg

Market Watch

U.S. antitrust regulators have dialed back plans to collect a mass of data from companies planning mergers - but even the weakened rules could be tricky for private equity firms, according to attorneys. Last week the Federal Trade Commission voted unanimously to expand the amount of information collected under the Hart-Scott-Rodino Act, which established the federal review process for mergers and acquisitions. The new reporting system “marks a generational upgrade that will sharpen the antitrust agencies’ investigations and allow us to more effectively protect against mergers that may substantially lessen competition or tend to create a monopoly,” said FTC chair Lina Khan. However, antitrust lawyers say it will saddle private equity with more paperwork, fees and headaches, without necessarily resulting in more blocked deals. The FTC estimates the changes will add 68 hours to the length of time it takes to prepare M&A paperwork. 

 

Wall Street Journal

Chinese film star Fan Bingbing is making her return to the screen after a five-year break following a tax evasion scandal. She stars in the neo-noir thriller Green Night, set to release on U.S. streaming services on October 18. Fan's troubles began in May 2018 when allegations surfaced regarding her under-reporting of income, leading to an investigation and a hefty fine of 883m yuan. Despite her efforts to maintain a presence on social media and develop her beauty brand, Fan's career has faced challenges since the scandal.

 

The Guardian

Italy is set to increase its capital gains tax on Bitcoin investments from 26% to 42%, as announced by Deputy Finance Minister Maurizio Leo during a budget plan conference call in Rome. He stated that the move is necessary as the “phenomenon is spreading,” indicating a growing interest in cryptocurrency investments. This tax adjustment is part of Italy's broader budget strategy, which also includes plans to tap banks and insurers for €3.5 bn.

 

Bloomberg Tax