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Accountancy Slice
USA
31st March 2026
 

THE HOT STORY

U.S. proposes opening 401(k) plans to private equity and crypto

The Trump administration has proposed new rules allowing alternative assets such as private equity, private credit, and cryptocurrencies to be included in 401(k) retirement plans, aiming to broaden investment options and potentially enhance returns and diversification for savers. The move, led by the Department of Labor, would ease longstanding restrictions and provide guidance and legal protections for plan trustees evaluating these more complex and less liquid investments. While industry groups have welcomed the proposal as a way to unlock new capital and improve retirement outcomes, critics warn of higher fees, valuation challenges, and liquidity risks for retail investors. The rule will undergo a 60-day consultation period, with final adoption still pending.

TAX

IRS cancels $225m in contracts, raising concerns over taxpayer services

The IRS has canceled 344 contracts as part of a federal cost-cutting initiative, including 115 taxpayer-facing agreements, potentially saving over $225m through avoided costs and reduced obligations. TIGTA said the canceled contracts covered services such as tax system updates, interpreter support, and taxpayer assistance programs, raising concerns about possible service disruptions and delays. While the agency identified more than 500 contracts for potential termination, many of the canceled agreements involved small and disadvantaged businesses. A watchdog report warned that cutting taxpayer-facing services could create gaps in support and require operational adjustments, though no formal recommendations were issued.

Nearly half of U.S. taxpayers claim new deductions under Republican tax law

U.S. Treasury Secretary Scott Bessent has said nearly half of tax filers have claimed new deductions introduced under last year’s Republican tax law, contributing to a more than 10% increase in average refunds to $3,571 so far in the 2026 filing season. Popular measures include deductions for overtime pay, tips, Social Security income, and auto loan interest, alongside higher state and local tax deductions. Bessent added that the changes are prompting many taxpayers to reduce withholding, effectively boosting take-home pay, while also highlighting a 20% rise in suspicious activity reports linked to fraud, as authorities intensify enforcement and encourage whistleblower tips.

Washington's 'millionaires tax' takes effect

Washington Gov. Bob Ferguson has enacted a new high-earners income tax, known as the “millionaires tax,” which imposes a 9.9% levy on earnings exceeding $1m. Set to begin with 2028 income, the tax is projected to generate between $3bn and $4bn annually, impacting around 21,000 households. Ferguson said: “This is truly a historical step forward in rebalancing our tax code,” as he emphasized its importance for working families. The revenue will primarily support the state operating budget, with a portion allocated for child care and early learning subsidies. Additionally, the measure aims to provide tax relief for residents, including the elimination of sales tax on essential items and expanded eligibility for the Working Families Tax Credit, benefiting approximately 460,000 households. Despite its potential benefits, the tax faces anticipated legal challenges from opposition groups.

Evers vetoes Wisconsin entry into federal school choice tax credit program

Wisconsin Gov. Tony Evers has vetoed legislation that would have enrolled the state in a federal school choice tax credit program, arguing it would divert public funds toward private education without sufficient accountability or proven student benefits. The program offers taxpayers up to $1,700 in credits for donations to organizations supporting private school expenses, but Evers cited concerns over its lack of oversight, undefined costs, and potential to undermine public education funding. Republican lawmakers and school choice advocates supported participation, saying it would expand educational options at no cost to the state, but Evers maintained that his experience shows voucher programs weaken public schools. The veto means Wisconsin will not formally join the program before the 2027 deadline, though residents can still donate to out-of-state schemes, while debate continues over school funding pressures and the growing reliance on local referendums to support public education.

Property taxes soar in Cook County

According to a report from Cook County Treasurer Maria Pappas, the Illinois county's property tax levy has surged from $6.8bn in 1995 to $19.2bn in 2024, significantly outpacing inflation. Pappas attributes this increase to loopholes in the Property Tax Extension Limitation Law (PTELL), which was intended to limit tax hikes. “The biggest culprit is what we call the levy,” Pappas stated, emphasizing the need for local spending cuts. Predominantly Black neighborhoods have been disproportionately affected, with areas like Oakland experiencing a 636.22% increase in property tax bills. Schools account for about 50% of the total tax bill, with demands rising 189%, largely due to pension funding mandates.

LEGAL

Court allows IRS to pursue $371m from convicted tax lawyer

A U.S. appeals court has ruled that the IRS can immediately pursue $371m in restitution from former tax lawyer Paul Daugerdas, rejecting his latest legal challenge more than a decade after his conviction in a major tax fraud case. The court found that the IRS has the authority to independently assess and collect restitution, including setting its own payment terms, regardless of a criminal court’s schedule. Daugerdas, who was convicted in 2013 for orchestrating fraudulent tax shelters that cost the U.S. over $1.6bn in lost revenue, had argued against the IRS’s separate civil action. The ruling means the full amount is now due immediately, despite earlier arrangements for gradual repayment following his release from prison in 2024.

TECHNOLOGY

California to impose new AI rules in defiance of Trump

California is to impose new standards on artificial intelligence (AI) companies seeking to do business with the state, in defiance of Donald Trump’s demands to keep the AI industry as deregulated as possible. Democratic governor Gavin Newsom has signed an executive order that gives the state four months to develop AI policies that prioritize public safety. Companies hoping to sign contracts with the state will have to demonstrate how their models avoid incorporating “harmful bias” and detail policies to avoid “unlawful discrimination, detention, and surveillance.” Trump has warned states not to get involved in regulating artificial intelligence. In a recent set of policy guidelines, the White House said a “patchwork of conflicting state laws would undermine American innovation and our ability to lead in the global AI race.” 

INTERNATIONAL

U.S. trade representative slams WTO after e-commerce tariff talks fail

The U.S. has pledged to pursue alternative trade agreements outside the World Trade Organization (WTO) after talks in Cameroon failed to extend a longstanding e-commerce tariff moratorium, blocked by Brazil and Turkey. Trade representative Jamieson Greer warned the WTO will play a diminished role in global trade policy, as Washington seeks plurilateral deals with willing partners, while the collapse highlights growing fragmentation in the global trading system and risks creating a complex patchwork of bilateral and regional agreements.

Binance unit fined $6.9m over client onboarding failures

Australia's federal court has fined Binance's local unit A$10m ($6.9m) for misclassifying over 85% of its Australian clients ‌that exposed them to high-risk crypto products. Binance ⁠Australia Derivatives admitted the failures in a statement of agreed ​facts with the Australian Securities and Investments ​Commission (ASIC). Reuters notes that in ​one instance, ⁠a client was incorrectly deemed a professional investor based solely on a self-certification as an "exempt ​public authority", without proper verification.

Apple calls in PwC to resolve Australian payroll blunder

Apple's Australian subsidiary has engaged PwC to investigate a significant internal technology error affecting thousands of employees' pay and leave entitlements. The company must reimburse hundreds of former employees and provide additional leave to current staff due to a mistake in its human resources systems, which incorrectly counted public holidays as leave days. "We are committed to rectifying this issue," a spokesperson said.

AND FINALLY...

Many employees say work has been stripped of fun

The loss of small perks and the rise of artificial intelligence (AI) in a push seemingly aimed at squeezing more work out of fewer people have conspired to strip the office of all fun, many employees are saying. The Wall Street Journal notes that chief financial officers at large U.S. companies mentioned “efficiency” at least once on 307 conference calls in the latest quarter as of March 26th, up from 219 a year earlier and the highest level since at least 2020, according to AlphaSense. “There’s almost nobody who is feeling positive vibes about their job right now,” said Rocco Seyboth, a longtime software marketer outside Seattle. “Everyone I talked to is consumed by AI - either how to use it, how to pretend to use it, how much they hate using it, how it’s going to eliminate their position or their company’s product,” he said. Human resources executives say they are aware of the concerns of white-collar staff.  “There’s fear in the workforce,” said Jacqui Canney, chief people and AI enablement officer at the technology company ServiceNow. 
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