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An IRS strategy to audit high-income taxpayers is facing significant challenges due to staffing and budget cuts initiated during the Trump administration. A TIGTA report has highlighted that while the IRS aimed to increase audits on high-income individuals, the reduction in funding from the Inflation Reduction Act of 2022 has limited enforcement resources. The IRS has lost about 26% of its workforce this year, which may hinder its ability to meet the goals set by the 2022 Treasury Directive. The report does not provide recommendations, or include responses from IRS officials.

 

Accounting Today

How to Grow CAS With Existing Clients

While attracting new clients is vital, your current clients already know and trust your firm. The question is—are you making the most of that trust to introduce them to new services? We've partnered with CPA.com to bring you the ultimate guide: How to Grow Your Client Advisory Services (CAS) with Current Clients.
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Deloitte Tax LLP has acquired assets from Trust Processing Solutions, enhancing its fiduciary tax services. This merger combines Deloitte's expertise with TPS's specialized knowledge, positioning Deloitte as a leading provider in the U.S. fiduciary tax market. The deal will unify the Deloitte Tax Institutional Trust Group and former TPS employees, creating a stronger team to serve clients. Doug Hart, TPS managing partner, expressed excitement about the collaboration, emphasizing the value it will bring to clients. The acquisition follows Deloitte's trend of expanding through mergers and acquisitions, including a recent deal with SimplrOps.

 

Bloomberg Tax

Accounting Today

Morgan Stanley, Goldman Sachs, and Wells Fargo have agreed to pay a total of $120m to settle a lawsuit alleging they concealed conflicts of interest during the sale of ViacomCBS shares, which contributed to the collapse of Bill Hwang's Archegos Capital Management. The proposed settlement, filed in New York state court, requires judicial approval. Archegos, which once managed $36bn, collapsed in March 2021 after failing to meet margin calls on loans used for significant investments in ViacomCBS and other stocks. The settlement allocates $75m for common stock investors and $45m for preferred stock investors, with lawyers seeking 29% of the fund for fees.

 

Reuters

Two of Facebook parent company Meta’s best known executives, chief executive Mark Zuckerberg and former chief operating officer Sheryl Sandberg, are listed as witnesses in a scheduled eight-day non-jury trial starting tomorrow in Delaware centered on investor allegations of board mismanagement. Shareholders of Meta Platforms sued Zuckerberg and other current and former company leaders, claiming they continually violated a 2012 agreement between Facebook and the Federal Trade Commission to protect users' data. Zuckerberg is accused of operating Facebook as an illegal enterprise that allowed users' data to be harvested without their consent. Zuckerberg and the other defendants have dismissed the allegations in court filings as "extreme claims."

 

Financial Times

Reuters

President Donald Trump's "One Big Beautiful Bill Act" is poised to increase administrative costs for insurers including UnitedHealthcare and Aetna, complicating their management of Medicaid health plans. Experts predict that the insurers may reduce their Medicaid coverage and focus on retaining healthier members. The bill mandates that low-income adults in expanded Medicaid states verify their work status every six months, a requirement that could overwhelm state Medicaid departments. Nikita Singareddy, chief executive of Fortuna Health, said: "The expectation is that states are going to have to be ready by 2026 or 2027, and that's a fast turnaround window." The Congressional Budget Office estimates that these policy changes could leave 7.8m people uninsured by 2034, with disenrollments potentially starting in 2027. Insurers may also adjust their strategies to retain healthy members, which could lead to increased administrative costs in the short term.

 

US News and World Report

Bank of America's latest global fund manager survey indicates that investor sentiment has reached its highest level since February, driven by increased profit optimism and a notable rise in risk appetite. Despite this "toppy" sentiment, the bank suggests that investors are more likely to engage in a "summer of hedging and rotation" rather than retreating from the market, as cash levels have fallen to a low that has triggered a sell signal.

 

Reuters

Short-term rentals have emerged as a profitable investment avenue, particularly with platforms like Airbnb and VRBO. However, navigating the tax landscape can be challenging. CPAs play a vital role in helping property owners optimize their profits through effective tax strategies. One key strategy is the short-term rental tax loophole, which allows owners to offset rental income with property-related losses: "if the average rental period is seven days or less . . . the income is not considered passive." CPAs also assist in maximizing deductions, such as depreciation, and help clients demonstrate material participation to bypass Passive Activity Loss rules. By employing advanced tax strategies, CPAs ensure compliance with tax laws while enhancing the financial outcomes of short-term rental investments.

 

Accounting Today

Recent regulatory changes under the Trump administration have revitalised merger and acquisition prospects for U.S. banks, particularly regional ones. James Stevens, a law partner at Troutman Pepper Locke, noted: "What we've seen from a regulatory standpoint is a lot more clarity and . . . a return to a more permissive environment," which could facilitate larger bank deals. The Federal Reserve's new criteria for 'well managed' bank status eases the path for firms to pursue acquisitions. Industry executives anticipate a rise in M&A activity, especially among regional lenders, as they seek to gain scale. However, larger banks face more scrutiny due to their market share.

 

Reuters

Festus Adenisimi, owner of FA Tax, was sentenced to 57 months in prison for his role in a fraudulent tax scheme that defrauded the IRS of nearly $8m. Adenisimi admitted to falsely preparing tax returns and fraudulently obtaining two Paycheck Protection Program loans totaling $760,415. The IRS estimated the total loss from the fraudulent returns exceeded $7.5m. Three other tax preparers involved in the scheme also received prison sentences, with Sunshyne Endurance Ogungbemi sentenced to 18 months, Chris Mary Tijerina to 15 months, and Cynthia Bradley to 15 months. Acting U.S. Attorney Nancy Larson stated: “We will continue to track down those who attempt to cheat the American people.”

 

CPA Practice Advisor

Aircraft, machinery, cars, chemicals and medical devices are the leading big-ticket items on the latest list of U.S. goods the European Commission has proposed to impose tariffs on if talks with Washington do not yield an agreement on trade. The package is designed to respond to U.S. tariffs on cars and car parts and a baseline tariff, currently at 10%; it also includes electrical and precision equipment as well as agriculture and food products worth a total of €6.35bn ($7.42bn). The European Union’s approach to U.S. tariffs is getting renewed attention this week after President Donald Trump sent a letter to the bloc threatening to impose 30% blanket tariffs on European imports beginning August 1st.

 

Financial Times

Reuters

Wall Street Journal

John Elkann and his siblings, Lapo and Ginevra, from the Agnelli clan, have agreed to pay approximately €175m ($204m) to Italy's Revenue Agency to resolve a tax evasion investigation. A spokesperson confirmed the agreement, although the total amount was not officially disclosed. The deal was reached “with the aim of swiftly” addressing the allegations, according to sources familiar with the situation.

 

Bloomberg Tax

AICPA and CIMA have been recognized as a Great Place to Work in eight countries for 2025, including the United States, United Kingdom, Malaysia, China, India, South Africa, and newly added Poland and Sri Lanka. With over 1,200 employees, the Association emphasizes career advancement, competitive pay, and a values-driven culture. Sue Warman, Chief People Officer, stated, “This achievement is a direct result of our people and the positive culture they help create every day.” The certification, based on a confidential trust index survey by Great Place to Work, reflects employee feedback on key workplace factors. The certification is valid for 12 months and can be renewed annually.

 

CPA Practice Advisor