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Intuit expects third-quarter profit to fall short of Wall Street estimates as it ramps up marketing and customer support spending during the peak U.S. tax season, sending its shares down about 4% in after-hours trading. The company forecast adjusted earnings of $12.45-$12.51 per share for the quarter ending April 30th, below analysts’ expectations of $12.95. Intuit said the increased spending is aimed at attracting more customers to its TurboTax and QuickBooks products and boosting growth in assisted tax services. Revenue is expected to rise about 10% in the third quarter, roughly in line with market estimates. The tax season, which runs through April 15th, is typically Intuit’s strongest period. For the second quarter, revenue climbed 17% to $4.65bn, beating expectations of $4.53bn.

 

Reuters

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The National Association of Tax Professionals emphasizes the crucial role tax practitioners play in the tax system, saying: "Tax practitioners shouldn't be treated as an afterthought in IRS reform." They advocate for the inclusion of tax professionals in discussions about improving IRS administration and taxpayer service. While acknowledging progress made by the IRS, they highlight the need for clearer communication and more reliable systems to enhance taxpayer experiences. Practitioners often help clients navigate complex IRS correspondence, which can lead to confusion and delays. The article calls for modernization efforts to be paired with clear guidance and accessible tools, ensuring that tax professionals can effectively assist taxpayers. Ultimately, the NATP urges ongoing engagement between tax professionals and policymakers to create a tax system that truly serves the needs of taxpayers.

 

Bloomberg Tax

In his State of the Union address on Tuesday, President Donald Trump highlighted new tax benefits for tipped workers, promising the largest tax refunds in American history due to recent tax cuts. "With the great big beautiful bill, we gave you no tax on tips," Trump said, introducing Megan Hemhauser, a waitress who anticipates an extra $5,000 in take-home pay. Despite the optimism, many Americans express dissatisfaction with Trump's economic management, as shown in a recent NPR/PBS News/Marist poll. Garrett Watson from the Tax Foundation noted that average refunds for the middle class are expected to rise this year, thanks to new tax policies. However, confusion remains about eligibility for the $25,000 deduction for tipped workers, which includes bartenders and waiters. As the deduction is set to expire in 2028, many workers hope for its permanence to alleviate financial pressures.

 

NPR

The IRSand the Treasury Department announced plans to issue proposed regulations under Section 987 of the Tax Code, focusing on taxable income and foreign currency gains or losses for qualified business units. In Notice 2026-17, they revealed that taxpayers could elect the equity and basis pool method for calculating unrecognized Section 987 gains or losses. The proposed regulations aim to simplify compliance and refine existing rules, particularly for controlled foreign corporations, which may not need to recognize foreign currency gains or losses under certain conditions. "The rules relating to this election will be described more fully in future guidance," the notice stated, indicating further clarifications will follow.

 

Accounting Today

In a world where financial complexity is increasing, CPAs are uniquely positioned to lead the charge in enhancing financial literacy. Melissa Linn, a CPA/PFS, emphasizes that “CPAs occupy a rare position of trust, technical authority, and long-term visibility into their clients' financial lives.” The FINRA Foundation's 2024 National Financial Capability Study reveals that only 27% of Americans can answer basic financial questions correctly, highlighting the urgent need for education. Julia Bush, a CPA, notes that “financial literacy education is a great benefit not only to the individual but to communities and even our entire country.” With 30 states expected to implement financial literacy requirements in high schools by 2025, CPAs can play a crucial role in supporting educators and advocating for financial education as a core life skill. The future of financial literacy depends on the engagement of financial professionals to shape a financially informed generation.

 

Journal of Accountancy

New applications for U.S. unemployment benefits rose modestly last week, signaling a stabilizing labor market despite ongoing economic uncertainty. Initial jobless claims in the seven days to February 21st increased by 4,000 to a seasonally adjusted 212,000, slightly below the 215,000 expected among economists surveyed by the Wall Street Journal. The four-week moving average was little changed at 220,250, while continuing claims, reported with a one-week lag, fell by 31,000 to 1.83m, suggesting steady hiring conditions. "Initial jobless claims are consistent with our view that labor market conditions have stabilized and will improve as 2026 unfolds," commented Nancy Vanden Houten, lead U.S. economist at Oxford Economics. "The low hiring rate remains the most concerning aspect of the labor market, but continued claims signal that employers aren't pulling back further."

 

The Detroit News

Bloomberg

Nasdaq

Wall Street Journal

Fintech company Block has announced it will lay off over 4,000 workers, or nearly half of its workforce, as artificial intelligence transforms operational dynamics. Jack Dorsey, co-founder and head of Block, emphasized that the layoffs are not due to financial issues but rather a shift in how companies operate. “We're already seeing that the intelligence tools we're creating and using . . . are enabling a new way of working,” he said. Dorsey said he opted for immediate cuts to avoid prolonged uncertainty, explaining: “Repeated rounds of cuts are destructive to morale.” Block aims to complete the workforce reduction by the end of the second quarter of fiscal year 2026. Dorsey plans to address employees directly in a live session, keeping communication channels open for farewells.

 

Los Angeles Times

A federal judge ruled on Thursday that the IRS unlawfully shared taxpayer addresses with Immigration and Customs Enforcement (ICE) approximately 42,695 times. U.S. District Judge Colleen Kollar-Kotelly found that the IRS violated IRS Code 6103, which protects taxpayer confidentiality, by disclosing information to ICE without meeting statutory requirements. Under the government’s process, she wrote, ICE could have submitted a request with an address like “Don’t Care 12345” or simply “00000” and still received a taxpayer’s home address from the agency. Dottie Romo, the IRS' chief risk and control officer, revealed that the agency provided data on 47,000 individuals from a request for 1.28m.

 

Courthouse News Service

US News and World Report

Washington Post

According to a global study by AICPA and CIMA, in collaboration with North Carolina State University, there is a significant disparity in artificial intelligence (AI) adoption among organizations. While a select group of “AI-Transformed Entities” is reaping strategic benefits, most companies lack the necessary talent, systems, and governance to effectively implement AI. Mark Beasley, Director of the ERM Initiative at North Carolina State, emphasizes that “governance, talent, and infrastructure are critical, not optional.” The study reveals that only 24%-27% of organizations feel adequately prepared in these areas, with smaller firms being the least equipped. The findings also highlight that AI adoption varies by region and industry, with emerging markets showing stronger transformation.

 

CPA Practice Advisor

The Trump administration has proposed new Affordable Care Act (ACA) rules that would allow insurers to offer lower-premium plans with significantly higher deductibles - potentially up to $15,000 for individuals and $31,000 for families - shifting more health care costs onto consumers. Officials, including Medicare and Medicaid Administrator Dr. Mehmet Oz, say the changes aim to increase choice and lower monthly premiums without requiring congressional approval. The proposal expands the availability of “catastrophic” or “skinny” plans, which typically carry high out-of-pocket costs and limited coverage. Supporters argue such plans encourage consumers to shop for care and reduce unnecessary spending. Critics warn the changes could make health care unaffordable, especially for people with chronic conditions, and may lead to higher medical bills before insurance coverage begins. Some experts say the high deductibles far exceed those in typical employer-sponsored plans and could discourage people from seeking care. The proposal also includes other changes to ACA markets, such as redefining essential benefits, potentially dropping adult dental coverage, and making enrollment more difficult. Administration estimates suggest up to two million people could lose coverage by 2027. The debate comes after enhanced ACA subsidies expired, leading to rising premiums and over a million people leaving marketplace plans this year. Opponents argue the administration should instead restore subsidies to maintain broader, more affordable coverage rather than expand high-deductible options.

 

New York Times

S corporations are increasingly favored by small to mid-size businesses due to their tax advantages and liability protections. They offer a blend of corporate benefits and LLC simplicity, but come with specific compliance requirements. An S corp is not a business type but an IRS election that allows profits and losses to pass through to owners' personal tax returns, avoiding double taxation for C corporations and reducing self-employment taxes for LLCs. Nellie Akalp, chief executive of CorpNet.com, emphasizes the importance of understanding payroll and distribution processes to maximize tax savings while ensuring compliance. "Choosing S corp status can reap significant tax benefits for businesses," she notes. However, businesses must adhere to IRS guidelines regarding reasonable compensation to avoid penalties.

 

CPA Practice Advisor

Fund manager Vanguard Group is to pay $29.5m to settle a lawsuit by 13 Republican state attorneys general who claimed the firm and rivals violated antitrust law through climate activism. Reuters notes that the suit in the U.S. District Court in the Eastern District of Texas has been closely watched as a test of how far Republicans from energy-producing states would push Wall Street firms they accused of overemphasizing environmental matters. Kansas Attorney General Kris Kobach, one of the plaintiffs, said Vanguard "agreed to strict passivity commitments" which prohibit the firm from dictating the strategy of companies in which it invests or to push shareholder proposals related to environmental or social concerns. Vanguard decided to settle the litigation to avoid the potential for tens of millions of dollars in legal fees and to get rid of the “distraction”, said sources.

 

Financial Times

Reuters

AT&T is to settle a lawsuit by four New York City public pension funds by letting shareholders vote on whether it should disclose the breakdown of its 133,000-person workforce by race, ethnicity and gender. The funds last week sued to block the Dallas-based firm from soliciting shareholder proxies that would have excluded their diversity proposal from consideration at its 2026 annual meeting.

 

Reuters

Google has disrupted the operations of a Chinese-linked hacking group known as UNC2814 which had breached at least 53 organizations across 42 countries. The group used Google Sheets to execute their surveillance and data theft, successfully blending their activities into normal network traffic, according to Google Threat Intelligence analysts. John Hultquist from Google's team said: “This was a vast surveillance apparatus used to spy on people and organizations throughout the world.”

 

Reuters

The IRS is set to replace its Filing Information Returns Electronically (FIRE) system with the new Information Returns Intake System (IRIS) next year. Tax practitioners must ensure their vendors are prepared for this transition and also check on state government readiness. Wendy Walker, vice president of regulatory affairs at Sovos, highlighted that many states, which have relied on the FIRE system since the 1980s, are not adequately prepared for the switch. "What we see already is they require Excels, CSVs," she noted, indicating that states are struggling with the new requirements. With the FIRE system retiring for the 2026 tax year, states will need to develop unique solutions to adapt. Walker warns that the transition will be "bumpy" for the next several years, emphasizing the importance for businesses to confirm their providers are equipped for state reporting as well.

 

Accounting Today

Japan's professional accounting body is raising the minimum number of Certified Public Accountants required for firms auditing publicly listed companies. This change aims to ensure adequate staffing to detect accounting irregularities and promote industry consolidation. Experts say the move may see smaller firms consider mergers.

 

Bloomberg Tax