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Accountancy Slice
USA
2nd April 2026
 

THE HOT STORY

Millions of dollars in tax credits claimed by ineligible ITIN filers

According to a new TIGTA report, individuals with Individual Taxpayer Identification Numbers (ITINs) have improperly claimed approximately $172m in tax credits for the tax years 2023 and 2024. The report highlights that 45,386 returns included claims for credits, including $142.8m in refundable credits like the Earned Income Tax Credit, which ITIN holders are not eligible for. TIGTA's review revealed that 294 tax returns claimed over $637,000 in credits without valid Social Security Numbers (SSNs). Kenneth Corbin, chief of the Taxpayer Services Division at the IRS, said: "We are implementing significant procedural and programming changes under the One Big Beautiful Bill Act of 2025," to enhance compliance and integrity in tax credit claims. TIGTA has made six recommendations to address these issues, all of which the IRS has agreed to implement.

TAX

Trump tax cuts deliver $65bn-plus windfall to corporations

The recent overhaul of the Tax Code under President Donald Trump has led to significant reductions in federal cash income taxes for many of the largest corporations in the U.S. A Bloomberg analysis revealed that nearly a dozen of the top 50 companies reported lower tax payments directly linked to the $3.4tn tax law, resulting in a $65bn drop in annual corporate tax revenues. Amazon.com exemplified this trend, with its tax liability decreasing from over $7bn to $2.8bn despite increased revenue. Brandon Pizzola, an economist at EY, noted that the law provided a "roughly 15% tax cut to Corporate America." Matthew Gardner from the Institute on Taxation and Economic Policy highlighted that corporate effective tax rates are at their lowest in 40 years, indicating a clear trend of substantial tax savings for corporations. "If filing season ended right now, we'd have the lowest effective corporate tax rates overall that I've ever seen," Gardner said.

IRS leadership questioned as CEO role sparks confusion and criticism

IRS chief executive Frank Bisignano has defended his leadership amid growing scrutiny in Washington over who is effectively running the agency, as his newly created role—alongside Treasury Secretary Scott Bessent as acting commissioner—blurs traditional lines of authority. Mr. Bisignano says he is focused on modernizing the IRS through technology and artificial intelligence, citing a 22% rise in online transactions and efforts to improve customer service following significant staff cuts and reduced funding. However, lawmakers, union leaders, and some IRS staff have raised concerns about his effectiveness and authority, criticizing a lack of clear strategy, bottlenecks in contracting processes, and claims that he is acting as an enforcer of White House directives rather than an independent administrator. Bisignano is set to face further scrutiny at a Senate Finance Committee hearing on April 15th.

FIRMS

EY tightens hybrid policy with three-day office requirement for U.S. tax staff

EY has instructed its U.S. tax employees to work in the office or at client sites an average of three days per week, requiring at least 12 in-person days per month starting July 1, as it tightens its hybrid working policy. The firm said the move is intended to strengthen collaboration, learning, and mentorship, while still allowing flexibility in how employees schedule their office time. The change reflects a broader trend across financial and professional services firms toward increased in-person work following pandemic-era remote policies.

ECONOMY

U.S. retail sales rebound in February, signalling resilient consumer demand

U.S. retail sales increased 0.6% in February, outperforming expectations of a 0.4% rise and reversing a revised 0.1% decline in January, indicating that consumer spending remains resilient despite a backdrop of weak job growth and subdued sentiment. The rebound was broad-based, with spending rising across most categories, led by department stores, up 3%, personal care, up 2.3%, and clothing, up 2%, while only grocery and furniture sales declined by 1% each. Underlying demand also strengthened, with the closely watched “control group” measure, excluding volatile categories such as autos, fuel, and building materials, rising 0.45%, above forecasts of 0.3%. However, the data reflects conditions before the recent escalation of the Middle East conflict, which has pushed oil prices above $100 per barrel and gasoline prices past $4 per gallon. Economists warn that higher energy costs, increased inflationary pressure, and heightened geopolitical uncertainty could weigh on consumer spending in the coming months, potentially dampening the current momentum.

Manufacturing sector expands as inflation pressures surge

U.S. manufacturing activity expanded in March, with the ISM purchasing managers’ index rising to 52.7 from 52.4 in February, remaining above the 50-mark separating expansion from contraction, and beating analyst expectations. However, the survey also signalled intensifying inflationary pressures, with the prices index jumping to 78.3, its highest level since 2022, as all tracked commodity categories recorded price increases, driven in part by disruption and higher costs linked to the war in Iran. Employment remained in contraction at 48.7, highlighting ongoing weakness in manufacturing jobs despite broader activity growth. A separate report on Thursday also indicated manufacturing sector growth, with the S&P Global Manufacturing PMI rising to 52.3 from 51.6, marking an eighth consecutive month of growth despite ongoing geopolitical tensions. Additionally, it suggested sharp increases in input costs driven by higher oil prices, worsening supplier delays, and early signs of stockpiling, while hiring has slowed as firms brace for potential disruption to demand, supply chains, and production in the months ahead.

Chicago business activity slows but remains in expansion territory

Business activity in the Chicago region continued to expand in March, though at a slower pace, with the Chicago Business Barometer falling to 52.8 from 57.7 in February and below expectations of 55.1. While readings above 50 indicate growth, the slowdown was driven by declines in employment, production, and new orders, with employment returning to contraction and production and orders weakening but remaining in expansion. Order backlogs rose to their highest level since December 2022, while input costs increased, with the prices paid index reaching its highest level since December amid rising metals prices and geopolitical pressures.

REGULATORY

CFTC official says agency will focus on core misconduct areas

David Miller, the new enforcement director at the Commodity Futures Trading Commission (CFTC), has said the regulator will focus on ‌policing misconduct including insider trading in prediction markets and manipulation in energy markets. The agency, which oversees commodities and swaps markets, will focus on a handful of enforcement areas, also including market abuse such ​as spoofing and willful violations of laws designed to prevent money laundering, Miller ​said in his first public remarks since joining the CFTC last month. “Unfortunately there’s a myth in mainstream media and social media that insider trading doesn’t apply in the prediction markets,” Miller said at a panel at New York University. “That is wrong.”

LEGAL

Supreme Court doubtful over Donald Trump’s birthright citizenship challenge

A majority of Supreme Court justices appeared skeptical of the Trump administration’s attempt to end automatic citizenship for those born in the country, in oral arguments ahead of a ruling that is expected by early July. The case, which tests what it means to be an American, could affect an estimated 250,000 children born to undocumented immigrants and temporary visitors each year. The administration says Trump's order, which would restrict birthright citizenship to babies with at least one parent who is a U.S. citizen or green-card holder, would not apply retroactively, but Democrats say it would also strip millions of current Americans of their citizenship, as well as their ability to vote and obtain passports. Chief Justice John Roberts dismissed contentions by President Donald Trump’s top Supreme Court lawyer, Solicitor General D. John Sauer, that the U.S. faced a “new world” in which so-called birth tourism was undermining the historic understanding of the nation. “Well, it’s a new world,” Roberts said. “It’s the same Constitution.”

IRS wins court battle over micro-captives

The IRS recently secured a court victory regarding micro-captive insurance arrangements, allowing it to enforce reporting requirements deemed potentially tax abusive. The U.S. District Court for the Eastern District of Tennessee upheld these regulations, stating that the IRS did not exceed its statutory authority. However, challenges to these regulations are expected to continue, particularly from Ryan LLC in Texas, which argues that the IRS's actions are arbitrary and capricious.

SMALL BUSINESS

Amazon selects U.S. Bancorp to issue new small-business credit cards

Amazon has chosen U.S. Bancorp to issue its relaunched small-business credit cards, replacing American Express and shifting the program onto Mastercard’s network. The new Prime Business and Amazon Business cards will offer enhanced rewards, including on spending beyond Amazon, as U.S. Bancorp looks to expand its payments and small-business banking services. The move marks a setback for American Express, which had partnered with Amazon on small-business cards since 2018, and supports U.S. Bancorp’s strategy to grow its payments division under new leadership.

INTERNATIONAL

Super-rich may be hiding $3.55tn offshore, Oxfam warns

Oxfam estimates that the world’s wealthiest individuals may have concealed up to $3.55tn from tax authorities through offshore holdings, despite increased transparency measures introduced in recent years. The charity said total offshore wealth reached $13.25tn in 2023, with the majority of hidden assets likely held by the richest 0.1% of households, and it renewed calls for a global wealth tax and stronger international cooperation to close tax loopholes and improve reporting standards.

KPMG Canada appoints Ali Jaffery as chief economist

KPMG Canada has appointed Ali Jaffery as its first chief economist, effective April 1st, to lead the firm’s economic advisory services and expand its research on key issues such as trade, productivity, and competitiveness. Based in Ottawa as a partner, Jaffery brings over 15 years of experience across government, central banking, and the private sector, most recently serving as a senior economist at CIBC. His appointment is aimed at strengthening KPMG’s ability to help clients navigate economic uncertainty and geopolitical challenges, and follows the firm’s recent investment in new leadership roles, including an AI research head.
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