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Top Senate Democrats are demanding answers from Treasury Secretary Scott Bessent and IRS chief executive Frank Bisignano over a controversial settlement between President Donald Trump and the IRS that created a $1.776bn “Anti-Weaponization Fund” for individuals claiming they were improperly targeted under the Biden administration. In a letter sent by Sens. Elizabeth Warren (D-MA) and Ron Wyden (D-OR), the lawmakers criticized the agreement as potentially corrupt and raised concerns that the fund could benefit Trump allies or individuals connected to the January 6th Capitol attack. They also questioned provisions that appear to shield Mr. Trump, his family, and affiliated businesses from certain ongoing or potential IRS audits and investigations. The settlement stems from Trump’s $10bn lawsuit against the IRS after a former government contractor pleaded guilty to leaking confidential tax records of Trump and other wealthy individuals. “This is an unprecedented remedy,” said former IRS Commissioner Daniel Werfel. “People expect the same tax rules and enforcement framework to apply to everybody.” “The president and his affiliates might not pay the taxes they should,” added Brandon DeBot, policy director at New York University’s Tax Law Center. “This is giving the president and his affiliates completely different set of rules than everyday taxpayers.”

 

ABC News

AP News

New York Times

What AI actually looks like inside a tax workflow

AI is quickly becoming part of how tax work gets done. But the real question now is where does it actually create value? 

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Amid the controversy around his settlement with the IRS, President Donald Trump will today visit one of the country’s most competitive congressional districts in New York as Republicans seek to promote last year’s tax law ahead of the midterm elections, despite weakening public approval of the president’s handling of the economy. Mr. Trump is appearing alongside Republican Rep. Mike Lawler in the Hudson Valley district, where the president plans to highlight provisions in the tax legislation, including a significant increase in the state and local tax deduction cap from $10,000 to $40,000. The change is particularly important in high-tax states such as New York and was strongly backed by Lawler during negotiations over the bill. The White House is using the event to emphasize what it describes as Mr. Trump’s efforts to lower costs for working families, even as recent polling shows declining confidence in the administration’s economic management amid rising gasoline prices linked to the conflict involving Iran.

 

US News and World Report

In a recent interview with CNBC's Andrew Ross Sorkin on “Squawk Box,” Jeff Bezos highlighted the disparity in tax contributions, stating that the top 1% of taxpayers contribute about 40% of total tax revenue, while the bottom half only pay 3%. Mr. Bezos argued for the elimination of federal income taxes for the lower half of earners, saying: “I don't think it should be 3%. I think it should be zero.” He emphasized the need to support struggling individuals, suggesting that instead of taxing them, the government should apologize. According to the Tax Foundation, the bottom half of taxpayers had an adjusted gross income of just under $54,000 in 2023, while the top 1% earned at least $676,000. The average tax rate for the bottom half was 3.7%, compared to 26.3% for the top 1%.

 

CPA Practice Advisor

Sales and use tax has shifted from a minor concern to a critical issue for small businesses, especially following the Supreme Court's ruling in South Dakota v. Wayfair. Mark Friedlich, Esq., CPA, emphasizes that "sales tax is now a core small business advisory issue," affecting various aspects of business operations. The 2025 data reveals a significant increase in sales tax rate changes, with 681 adjustments reported, indicating a growing complexity in compliance. Small businesses often face challenges due to misconceptions about tax obligations, particularly regarding digital goods and services. To navigate this landscape, advisors should conduct thorough nexus reviews, assess taxability by jurisdiction, and ensure valid exemption certificates. As technology advances, skilled tax professionals are essential to guide businesses through the evolving sales tax environment.

 

Accounting Today

Michigan is facing a significant imbalance in its tax auditing resources, focusing more on in-state taxpayers while neglecting out-of-state corporations that contribute a substantial portion of tax revenue. In 2022, out-of-state taxpayers generated approximately $7.1bn, compared to $6.1bn from in-state sources. Clay Cornelius, the Treasury Department's state assistant administrator, expressed concern, saying: “If that money declines, who's going to carry that burden? In-state.” The number of auditors assigned to out-of-state audits has drastically decreased from 28 in 2019 to just eight in 2025. This shift has led to increased pressure on in-state taxpayers, as fewer audits of out-of-state entities mean more reliance on local businesses. State Rep. Jay DeBoyer is advocating for better oversight and has suggested an independent audit of the Treasury's operations.

 

CPA Practice Advisor

The PCAOB has appointed Randy Thornton as chief operating officer after he served in the role on an acting basis since July 2025. Thornton, who has also been the PCAOB’s chief human resources officer since December 2022, will oversee the organization’s HR, finance, technology, enterprise strategy, project management, facilities, and operations functions. PCAOB chair Demetrios Logothetis said Mr. Thornton’s leadership and operational expertise would support the regulator’s efforts to modernize operations and strengthen resource management. He joined the PCAOB in 2022 as deputy director for HR Delivery and previously held senior management positions at the Federal Deposit Insurance Corporation, the US Department of the Treasury, the Environmental Protection Agency, and the Department of Labor.

 

The Accountant Online

Professional-services firms including PwC, McKinsey, EY, Deloitte, and KPMG are cutting executive assistant and other support roles as they look to reduce costs, improve profitability, and invest more heavily in artificial intelligence. The layoffs come amid slowing growth in consulting and professional services following the post-pandemic boom, with firms increasingly relocating support jobs from expensive hubs such as New York and London to lower-cost locations including Florida, Poland, India, Argentina, and the Caribbean. Executive assistants, who can earn more than $100,000 annually at top firms, are seen as particularly vulnerable to AI because many administrative tasks - including scheduling, travel booking, expense management, and document preparation - can increasingly be automated. PwC’s US business reportedly cut about 600 support staff earlier this year, while other firms including Grant Thornton, Baker McKenzie, and Standard Chartered have also announced reductions or restructuring plans affecting support functions. Industry experts say firms are prioritizing higher-paid revenue-generating employees in areas such as AI, cybersecurity, and private equity, while support staff are often the first targets during cost-cutting efforts. Some observers also believe companies are overstating AI’s immediate impact to justify layoffs that were already planned. Despite the pressure on traditional assistant roles, some firms are beginning to reshape positions around AI-enabled workflows, with new job postings focused on using automation and AI tools to improve productivity rather than eliminate support functions entirely.

 

Bloomberg

New U.S. unemployment claims fell last week, signaling continued labor market resilience despite rising inflation pressures tied to the conflict involving Iran and ongoing global supply chain disruptions. Initial claims for state unemployment benefits declined by 3,000 to 209,000 for the week ended May 16th, remaining near historically low levels even as technology companies continue to announce layoffs linked to artificial intelligence adoption. The four-week moving average fell to 202,500, the lowest since 2024, while continuing claims, reported with a one week lag, increased 6,000 to a seasonally-adjusted 1.782m. "We still can't rule out some spillover effects from the war and the spike in oil prices on to the labor market, which ​we have always expected would come with a lag," commented Matthew Martin, a senior U.S. economist at Oxford Economics. "But for now, we think the labor market ​is showing enough stability to allow the Fed to feel comfortable keeping policy steady."

 

ABC News

Bloomberg

Reuters

Wall Street Journal

U.S. manufacturing activity accelerated to its strongest level in four years in May as businesses increased inventories to protect against supply disruptions and rising costs linked to the conflict involving Iran, according to an S&P Global survey. S&P Global’s flash manufacturing PMI rose to 55.3 in May from 54.5 in April, marking the highest reading since May 2022 and beating economists’ expectations for a decline to 53.8. A reading above 50 indicates expansion. The increase offset a slight slowdown in services activity, leaving the flash U.S. Composite PMI Output Index unchanged at 51.7. Manufacturers boosted input inventories to an 11-month high amid concerns over shortages and price increases tied to shipping disruptions in the Strait of Hormuz, which have affected supplies of goods including fertilizers, aluminum, and consumer products. Supplier delivery times also lengthened to levels last seen in August 2022. The report also showed mixed labor trends, with manufacturing employment improving, while services sector hiring weakened, pushing overall private-sector employment to a 21-month low.

 

Reuters

U.S. housing starts declined in April as construction of single-family homes posted its sharpest monthly drop in nearly a year, signaling growing caution among homebuilders amid elevated mortgage rates and affordability pressures. New residential construction fell 2.8% to an annualized rate of 1.47m homes, according to the Commerce Department. Single-family housing starts dropped 9% to an annualized pace of 930,000, the largest decline since August, while single-family building permits fell 2.6% to their lowest level in eight months. By contrast, multifamily housing starts rose more than 10% to their highest level since May 2023, helping offset some of the broader weakness in residential construction. Construction activity declined in the South but increased in the other three U.S. regions, largely due to gains in multifamily projects. Single-family construction, however, fell across all four regions.

 

Bloomberg

Reuters

The Democracy Forward Foundation (DFF) has raised concerns regarding the U.S. Department of Justice's (DOJ) recent settlement in the case of Trump v. Internal Revenue Service, which involves a $1.7bn "Anti-Weaponization Fund." The DFF argues that the settlement lacks transparency and risks collusion between parties with common interests. They emphasize the need for the DOJ to preserve all records related to the settlement, stating: "These records are federal records that must be preserved under the Federal Records Act." The DFF has requested confirmation of preservation measures by May 21st 2026, highlighting the potential loss of crucial documents if immediate action is not taken.

 

Tax Notes

The threat posed to workers by artificial intelligence is giving employers more leverage, and CEOs are increasingly demanding results and holding people accountable for them. The focus now is on building a “performance culture” - a phrase used 633 times on earnings calls and in corporate documents, up from about 460, across companies in the S&P 500 Index last year - where expectations of workers soar, underperformers risk getting managed out and executives are less forgiving of bureaucratic impediments to efficiency. Ben Bryant, a professor of leadership and organization at Switzerland’s IMD Business School, wonders: “What will be sacrificed in the interests of performance?” Bloomberg observes that employee mental health, which business leaders prioritized during the pandemic, could once again get short shrift. 

 

Bloomberg

Verizon has said software flaws rather than stolen passwords have become the dominant entry point for hackers. In a review of more than 31,000 incidents in its annual Data Breach Investigations Report, Verizon found 31% started with vulnerability exploitation. The report said attackers are using AI to spot and exploit known vulnerabilities at machine speed, with the technology accelerating attacks from months to hours. Hackers are “demonstrably using GenAI to help at different stages of attack including targeting, initial access, and development of malware and other tools . . . AI’s primary impact is currently operational: automating and scaling techniques defenders already know how to detect, not yet unlocking these novel or rare attack surfaces.” Meanwhile, employees are not waiting for IT approval before adopting AI tools. Unapproved AI usage at work tripled from 15% to 45% of the workforce, making “shadow AI” the third most common source of non-malicious data leakage.

 

BankInfoSecurity

InfoSecurity Magazine

Techzine Global

President Donald Trump has postponed plans to sign an executive order on artificial intelligence because he said he was worried the measure could weaken America’s edge on AI technology.  “I didn’t like certain aspects of it,” Trump said of the order. “We’re leading China, we’re leading everybody, and I don’t want anything that’s going to get in the way of that lead.” AI was also “bringing in a lot of jobs”, Trump said. The order would have established a framework for the government to vet the national security risks of the most advanced AI systems before their public release, according to a person familiar with White House deliberations. It was not immediately clear when the signing might be rescheduled.

 

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Financial Times

Politico