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The Daily

NEWS HIGHLIGHTS FOR MONDAY - 10.24.16

By:
Maya Lindsay
Published Date:
Oct 24, 2016

NYSSCPA Members in the News

Kenneth Hall (Rochester)
Credit card pros & cons
WROC Rochester First
CPA Kenneth Hall discussed the pros and cons of using credit cards Monday on News 8 at Sunrise. Many will use credit this time of year to supplement holiday purchases.  Hall started by addressing some of the dangers associated with credit card use.  "It's important to know when you have a credit card, that it's money that's going to come out of your pocket later when the bill comes in the mail or email," he said.  "Once you can install discipline in your spending it's good to think about a credit card, but if you can't control yourself, credit cards are a real bad thing."

Other Accounting and Financial News Stories

Schumer Pushes $581 Payment to Social Security Beneficiaries
Wall Street Journal
Social Security beneficiaries should get a one-time $581 payment to compensate for an anemic cost-of-living increase in 2017, U.S. Sen. Charles Schumer said Sunday. While the average increase to Social Security benefits over the last 10 years has been about 2%, for 2017 it is 0.3%, according to the U.S. Social Security Administration. Mr. Schumer, a New York Democrat who is running for re-election next month, said he was backing legislation—introduced last year by Sen.  Elizabeth Warren, a Massachusetts Democrat—that would provide the one-time payment to the more than 65 million recipients of Social Security benefits.

Make or Buy?
Accounting Today
Acquisition activity in recent years is up in just about every industry, and accounting firms are no exception. Indeed, the last 15 years have produced historically high levels of merger and acquisition activity within the accounting industry. Not only is acquisition attractive as a growth story in an environment where 3 percent growth should be considered good for the mature firm, but acquisitions may also be the key to a viable succession strategy, both for the buyer and the seller.

Investors’ New Message to Global Governments: Spend More
Wall Street Journal
A growing number of investors and policy makers, seeing central banks as powerless to revive an anemic global economy, are championing a resurgence of fiscal spending. A move away from central-bank-led policy, and toward the use of the government’s taxing-and-spending power to revive growth, would end a years-long economic era and could cause upheaval in financial markets. Investors, among them bond king Bill Gross, once feared that government profligacy was a death knell for sovereign bonds.

The Future of FASB Standard Setting: Professional Accounting Update
Financial Executives International
The preparer community at large is embarking on an ambitious work program to begin implementing the most significant overhaul of existing accounting standards in recent memory, with new standards on revenue recognition, lease accounting, and financial instruments (credit losses and classification and measurement). Virtually every reporting company regardless of industry, sector, or size will be affected by these new standards issued by the Financial Accounting Standards Board (FASB) to some degree.

An Aspiring CFP Professional in a Sea of CPAs
AccountingWEB
There are many kinds of financial professionals at Plante Moran, a leading public accounting firm. We have those who hold the CPA and CFP designations, among others. Some colleagues of mine hold two or even three of these designations. However, I have been able to set myself apart by having passed the CFP exam and becoming a CFP professional before even starting my career in the industry.

You Made a Mistake on Your Tax Return. Should You Amend It?
Wall Street Journal
Broadway’s brightest star, Alexander Hamilton, summarized the problem neatly. “In common life, to retract an error even in the beginning is no easy task,” Mr. Hamilton once wrote, according to Ron Chernow’s biography of the nation’s first Treasury secretary. “Perseverance confirms us in it and rivets the difficulty.” While Mr. Hamilton wasn’t writing about income-tax bloopers, his words undoubtedly will resonate with millions of modern-day taxpayers. Nobody likes to admit mistakes, especially on tax returns.

Retirement Plans Can Make Loans, Distributions to Matthew Victims
Accounting Today
In the wake of Hurricane Matthew’s widespread devastation, 401(k)s and similar employer-sponsored retirement plans can make loans and hardship distributions to victims and their families, the IRS said. Participants in 401(k)s, employees of public schools and tax-exempt organizations with 403(b) tax-sheltered annuities, and state and local government employees with 457(b) deferred-compensation plans may be eligible. IRA participants are barred from taking out loans without a tax penalty, except in special circumstances and under liberalized procedures.

IRS Offshore Account Collections Top $10 Billion, FATCA Hunt Continues
Forbes
The IRS confirms that its offshore compliance efforts have now topped $10 billion. In all 55,800 taxpayers have entered the IRS’s Offshore Voluntary Disclosure Program (OVDP), paying more than $9.9 billion in taxes, interest and penalties. Another 48,000 taxpayers have entered the Streamlined program, paying approximately $450 million in taxes, interest and penalties. The Streamlined program has netted more than 96,000 delinquent and amended income tax returns.

How Passive Funds Trim Your Tax Bill
Wall Street Journal
Here’s a plus for passive investing over active: lower taxes. Taxes knocked an average of 0.96 percentage point a year off the returns of about 2,000 actively managed U.S. stock mutual funds over the 15 years ended in September 2014, if they were held in taxable accounts rather than tax-sheltered retirement plans, according to research by Vanguard Group. By contrast, taxes reduced the returns of 130 broad-based U.S. stock index funds by an average of 0.69 percentage point a year over the same period—about one-third less. The S&P 500’s annualized return was 2.91% during this period.

U.S. Stocks End Week Up a Bit
Wall Street Journal
Deal talks and earnings results sparked sharp moves in individual stocks, while the broader market was largely steady. The S&P 500 notched a weekly gain after ending Friday’s session little changed. Major indexes have swung between relatively small losses and gains in recent sessions, and daily stock-trading volumes have been below the 2016 average. The Dow Jones Industrial Average fell 16.64 points, or 0.1%, to 18145.71 on Friday and rose less than 0.1% for the week.