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House Democrats have unveiled a comprehensive package of social and climate change proposals, including a boost for millions of Americans with a permanent expansion of the earned income tax credit (EITC). The American Rescue Plan increased the benefit for these individuals up to $1,502 in 2021, almost triple the former write-off. The measure also widened eligibility by raising the earned income limit to $21,430 ($27,380 for married couples) and expanded age ranges to include Americans as young as 19 and filers over 65. House Democrats want to make the temporary expansions of the earned income tax credit permanent, according to a 645-page bill released Friday, effective after December 31st 2021.

 

CNBC

Hurricane Ida victims in parts of New York and New Jersey may now have until January 3rd to file federal personal and business tax returns. The IRS said eligible filers have the same extension for quarterly estimated tax payments, normally due September 15th; to qualify, someone must live in an area designated for individual or public assistance by the Federal Emergency Management Agency. The tax relief is similar to what’s available for Louisiana residents and does not include 2020 payments or returns that were due May 17th. Many taxpayers will automatically receive filing and penalty relief, as long as they have an address of record in a disaster area. However, those who receive a late payment notice may call the number provided to waive the fee. 

 

CNBC

The IRS plans to close its paper return processing center in Fresno, California, permanently at the end of this month, so taxpayers and tax professionals in some Western states will need to begin using a new mailing address. The IRS has been experiencing long delays in processing paper tax returns as a result of the pandemic, so the closure does not come at a good time for the agency. However, the closure was originally announced in 2016 and is part of a larger, ongoing efficiency strategy to adjust to the fact most taxpayers now file electronically.

 

Accounting Today

Internal auditors are seeing far-reaching effects from the COVID-19 pandemic on the way they do their work, according to a new survey from audit tech company AuditBoard. The firm found that  91% of the more than 175 chief audit executives who responded believe the use of technology will be more critical to conducting internal audits in the future, while 68% of the survey respondents believe internal audit teams will probably not return to traditional workplaces, but will work remotely all or part of the time. In addition, 68% of the respondents think audit teams will be more focused on innovative means to gather and analyze evidence as part of internal audit processes. New technology employed in the past year includes drones, pre-positioned security camera video feeds, and video documentation by smart phones and other devices. Chief audit executives said the use of drones to document the physical existence of assets or control effectiveness has given them sufficient evidence more efficiently than traditional means of auditing.

 

Accounting Today

EY is integrating its blockchain products with Polygon to mitigate the high fees and congestion associated with transacting on the Ethereum mainnet for its enterprise clients. EY emphasized that its enterprise clients will have access to increased transaction throughput with predictable fees and settlement times using Polygon. The Big Four firm also revealed it is working with Polygon to offer permissioned, private optimistic rollup chains. Rollups are a layer-two scaling solution that provides increased security and efficiency compared to transacting on the Ethereum mainnet. Demand for Ethereum scaling solutions has surged in recent months amid the persistently high fees associated with transacting on the mainnet. As such, the total value locked on the Polygon network has surged from roughly $1bn at the start of April to $8.5bn.

 

Cointelegraph

BKD Analytics, a national practice unit of BKD CPAs & Advisors, has released a new product, Payment Risk Analytics. The solution is designed to assist in the detection of fraud and help identify conflicts of interest and areas for process improvement. Payment Risk Analytics, which works by examining whole data sets instead of samples to help provide better insight, includes three focus areas: accounts payable risk analytics, purchasing card risk analytics and payroll risk analytics.

 

Accounting Today

Underlying U.S. consumer prices increased at their slowest pace in six months in August, the Labor Department reported Tuesday, as used motor vehicle prices tumbled, suggesting that inflation had probably peaked, though it could remain high for a while amid persistent supply constraints. The Consumer Price Index rose 5.3% in August from a year earlier, the data showed. That was a slightly slower annual pace than the 5.4% increase in July. On a monthly basis, price gains moderated to a 0.3% increase between July and August, down from 0.5% the prior month. The core inflation index, which strips out volatile food and fuel prices to try to get a cleaner read of underlying price trends, picked up 0.1% on the month and 4% annually. 

 

New York Times

Reuters

Wall Street Journal

New commercial bankruptcy filings have continued to fall throughout 2021, but experts say the favorable conditions that have allowed businesses to stave off Chapter 11 for the time being won’t last forever as the consequences of questionable deals and underlying operational problems come to the fore. The total number of new Chapter 7 and Chapter 11 bankruptcy cases filed for the 12 months ending June 30, 2021 were the lowest since 1985, according to the Administrative Office of the U.S. Courts. Commercial filings fell 17.7% to 18,511 compared with the previous year.

 

Reuters

Pay for directors at the biggest U.S. companies held steady last year, a first in more than a decade. An analysis of the 100 largest publicly-traded U.S. companies by revenue found that median pay for directors in 2020 was $310,000, flat from 2019 and up from $305,000 in 2018. Consulting firm Compensation Advisory Partners (CAP), which produced the report, found that about 15% of boards reduced director pay during the height of the pandemic last year, typically by suspending cash compensation for several months. “There’s still some sensitivity to the optics around COVID and where the world is at,” Daniel Laddin, founding partner of the firm, said. “As the year progresses, we expect more boards to feel comfortable not only reviewing the director pay programs, but approving increases.”

 

Wall Street Journal

Americans last year saw their first significant decline in household income in nearly a decade, government data showed. The Census Bureau's annual assessment of the nation's financial well-being revealed that median household income was about $67,500 in 2020, down 2.9% from the prior year, when it hit an inflation-adjusted historical high. It came as the U.S. last year saw millions lose their jobs and national unemployment soar from a 50-year low to a high of 14.8%. The last time median household income fell significantly was 2011, in the aftermath of the 2007-09 recession. The headline income figure includes unemployment benefits but doesn’t account for income and payroll taxes nor stimulus checks or other noncash benefits like federal food programs. If those had been counted, the median household income would have risen 4% to $62,773. The bureau said the traditional poverty rate in 2020 was 11.4%, an increase of one percentage point from 2019 and the first increase after five consecutive years of declines. That translated to 37.2m people in poverty, an increase of 3.3m from 2019. The distribution of incomes changed little. The top fifth of households - with incomes above $141,100 - collected 52.2% of household income, while the top 5% alone - with incomes above $273,700 - collected 23%. The bureau reported that the income shares collected by the lowest groups dropped slightly. The lowest fifth of households - making less than $27,000 - collected 3%, down from 3.1% in 2019.  Median incomes were highest in the Northeast ($75,211) and the West ($74,951), followed by the Midwest ($66,968) and the South ($61,243).

 

NPR

Washington Post

Wall Street Journal

Congresswoman Alexandria Ocasio-Cortez (D-NY) took to the 2021 Met Gala on Monday evening with a bright red message for Americans: "Tax the Rich." Making her Met Gala debut, Ms. Ocasio-Cortez completed the look with trademark gold hoops and a single pink flower pinned into her hair bun. "When we talk about supporting working families and when we talk about having a fair tax code, oftentimes this conversation is happening among working and middle class people (on) the senate floor. "I think it's time we bring all classes into the conversation," she continued.

 

CNN