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Michigan Income Tax
Deadline Set for April 17, 2007
Michigan's
individual income tax filing deadline for tax year 2006 will be Tuesday,
April 17, 2007, in line with the federal deadline. The IRS moved the federal
income tax filing deadline from Monday, April 16, 2007 to Tuesday, April 17,
2007 due to an Internal Revenue Code provision that recognizes federally the
Emancipation Day holiday observed by the District of Columbia on April 16,
2007. Michigan Income Tax forms and instructions were printed with a
deadline of April 16, 2007, because the normal filing-date, April 15, falls
on a Sunday this year. Tax preparers are encouraged to visit Treasury's new
"taxes" site, located at
www.michigan.gov/taxes.
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IRS Announces Relief for
Rank-and-File Employees with ‘Backdated’ Stock Options
On February 8, 2007, the IRS announced an initiative aimed at providing
relief for rank-and-file employees affected by their companies’ issuance of
backdated and other mis-priced stock options. If an employee exercised a
‘backdated’ stock option in 2006, the employee may owe an additional
20-percent tax, plus an interest tax, under the Federal tax laws governing
deferred compensation. The initiative, described in
Announcement 2007-18, allows companies to pay the additional 20-percent
tax and any interest tax that employees owe, providing a means to minimize
the burdens of compliance on employees who are not corporate insiders, while
ensuring that all applicable taxes are paid. While the program is available
to help these employees who may be unaware that they held backdated options,
top executives and other insiders are not eligible to take advantage of this
program.
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IRS Moves to Prevent
Telephone Tax Refund Abuse; Help Taxpayers Make Accurate Requests
The IRS is taking additional steps to prevent
abuse and help taxpayers make accurate requests for the one-time
telephone excise tax refund. IRS Criminal Investigation special agents
and IRS revenue agents are conducting special site visits with tax preparers
across the nation to prevent inflated requests made for the one-time
telephone tax refund. The IRS also issued a new reminder for taxpayers who
are not filing for the refund even though they may qualify. In early returns
filed this year, more than one-third of filers did not request the telephone
tax refund. Other taxpayers are making mistakes when requesting the refund.
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Technology Survey:
Information Security Management Remains Chief Concern
Information Security Management is expected to
continue to have a powerful influence over business in 2007, according to
the 18th Annual
Top Technology Initiatives survey of the AICPA. For the fifth
consecutive year, the survey identified Information Security as the
technology initiative expected to have the greatest effect in the upcoming
year. A related initiative – Identity and Access Management – jumped from
sixth place in 2006 to second in 2007. Privacy Management also nudged its
way up from fifth to fourth place, while four new initiatives made their
debut in this year’s top 10: Securing and Controlling Information
Distribution; Mobile and Remote Computing; Electronic Archiving and Data
Retention; and Document, Content and Knowledge Management.
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FASB Moves Forward on FIN
48
Although there was speculation about a delay
in implementation, FIN 48 will move forward as planned. At its
January meeting, the Financial Accounting Standards Board decided NOT to
delay implementation of FIN 48, Accounting for Uncertainty in Income Taxes,
released in July 2006. Although FIN 48 is intended to increase the
comparability of financial statements, it also significantly increases the
calculation and documentation requirements for individually identified
income tax exposures. The new rules apply for years beginning after December
15, 2006. MACPA offers numerous programs related to FIN 48. Search the
MACPA CPE Course Catalog, using the keyword “FIN 48” to find all the
latest courses.
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Requirement for
Work-Time Documentation Continues for Non-Resident
Detroit Taxpayers
The City of Detroit continues to require
non-resident taxpayers who allocate less than 100 percent of their income to
services performed in the City of Detroit to attach documentation from their
employer to verify lines 1 and 2 of Schedule N on page 2 of the Detroit
Non-Resident tax return Form D-1040 (NR). Employees are also asked to attach
a work log, if applicable. If no documentation is provided, the tax return
will be returned to the taxpayer requesting the missing employer
letter/documentation. This will result in delayed refunds. Last year, when
this requirement was new, the MACPA developed and obtained City approval for
a
sample verification letter to assist in compliance with this new
regulation.
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Three Hot Technologies
You Need to Know About
Internet services, Asynchronous JavaScript And
XML (AJAX), and Virtualization are three important tools that can benefit
small businesses, according to technology expert George Jones. Web services,
in particular, can provide small businesses with access to important
applications from locations both within and outside the office.
To read this article in its entirety and
much more about developments in technology, access
Technology and
Productivity Weekly, the MACPA's electronic technology newsletter for
industry professionals, sponsored by Information, Inc.
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