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20th October 2021
Democrats scale back IRS bank reporting plans
Senior Democrats in Congress have agreed to raise their proposed tax reporting threshold for bank account inflows and outflows to $10,000 a year, with exemptions for wage income, from an earlier proposal of $600 that drew criticism for being too intrusive.  U.S. Senate Finance Committee Chairman Ron Wyden (D-OR) on Tuesday said the new $10,000 IRS reporting threshold, to be included in Democrats' sweeping "reconciliation" social spending and tax hike legislation, was chosen after consultations with the U.S. Treasury because it is a level frequently used in other bank reporting requirements. These include requirements for banks to report daily aggregate cash transactions of $10,000 or more under anti-money laundering rules. “We’re adding language to ensure enforcement efforts are focused on the very wealthy,” Mr. Wyden said Tuesday. He added that the $10,000 figure was chosen because it is used in other instances. It is the threshold for when cash transactions must be reported to the government. Raising the reporting level is insufficient, banking industry executives said. Moreover, exempting certain payments would make it more complicated for financial institutions to determine which accounts should be subject to reporting, industry representatives added. “Banks aren’t the answer here,” said Greg Carmichael, chief executive of Fifth Third Bancorp. “We would hate to see [the requirement] materialize and be asked to police that space.”
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Congressional proposal would speed disaster tax relief
The IRS has been extending tax relief to Americans affected by natural disasters like hurricanes and wildfires, but recent legislation could make it easier to qualify for federal tax relief. Last month, a group of senators introduced a bipartisan bill known as the Filing Relief for Natural Disasters Act that would offer relief to taxpayers in states that have issued state-level emergency declarations. The IRS currently has the authority to delay tax-filing deadlines only when there’s a presidentially-declared federal disaster, but not for state-level emergencies. Congress is currently considering the Biden administration’s Build Back Better Act, which contains an array of climate-related provisions as well as tax and social safety net proposals. The Filing Relief for Natural Disasters Act isn’t part of it right now, but given the ongoing divisions in Congress over the multitrillion-dollar package between Republicans and Democrats, and among Democrats themselves, the bipartisan proposal could potentially fit into the Democrats’ bill as one possible area of agreement.
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Texas voters to decide in 2022 on property tax drop
Texas voters will decide next year whether homeowners will get a trim in their property tax bills after lawmakers rammed through a proposed constitutional amendment through both chambers shortly after it was first proposed Monday evening. The measure would raise the state’s homestead exemption from $25,000 to $40,000 for school district property taxes, netting the average homeowner about $176 in savings on their annual property tax bill, according to Houston Republican Sen. Paul Bettencourt, the proposal’s author. With the two chambers unable to reach an agreement on the Senate’s priority bill to reduce property tax rates, Texas lawmakers started from scratch on new legislation intended to lower homeowners’ property tax bills through an expansion of school district homestead exemptions. In the span of less than an hour, the bill sailed through a key committee and wound up back on the Senate floor where it passed unanimously — all before the text of the legislation became publicly available and without an opportunity for public comment. The proposal will cost the state more than $600m annually if voters approve it next May. 
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GASB renames financial report to avoid racist connotations
The Governmental Accounting Standards Board (GASB) is changing the term "Comprehensive Annual Financial Report" to "Annual Comprehensive Financial Report" because the abbreviation is often pronounced the same way as a derogatory term for Black South Africans. The changes in the name and acronym were widely supported by individuals and stakeholder groups that responded to an exposure draft it issued in April proposing the changes.
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PwC sells mobility unit to CD&R
PwC is to sell its mobility services division to private equity firm Clayton, Dubilier & Rice in a $2.2bn deal. The unit, which advises more than 3,000 organizations on tax and immigration issues when they move staff abroad, currently operates in about 40 territories. The business will be rebranded and led by new chief executive Peter Clarke, who is currently global managing partner for global employee mobility at PwC. The sale is expected to close in the first half of 2022. 
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Deloitte Launchpad announces second cohort with 7 new startups
Deloitte Launchpad has announced the seven new startups that will take part in its second cohort. The initiative, which is run by Deloitte, launched in 2020 and supports Israeli growth-stage startups and their desires to penetrate the U.S market by providing services to Deloitte’s global network. The chosen companies - Agora, BlazePod,, DigitalOwl, Hyro, IVIX, and SavorEat - will receive guidance from teams in the U.S and Israel to address three major challenges: laying foundations for relocation to the states, establishing strong and sustainable sales infrastructure, and support for funding.
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U.S. homebuilding stumbles as supply constraints mount
U.S. homebuilding unexpectedly fell in September and permits dropped to a one-year low amid acute shortages of raw materials and labor, supporting expectations that economic growth slowed sharply in the third quarter. The Commerce Department said that housing starts dropped 1.6% to a seasonally adjusted annual rate of 1.555m units last month, the lowest level since April. Economists polled by Reuters had forecast starts would rise to a rate of 1.62m units. Single-family starts, which account for the largest share of the housing market, were unchanged at a rate of 1.080m units last month. Single-family homebuilding rose in the West and Midwest, but fell in the Northeast and the densely populated South. Applications to build, a proxy for future construction, fell 7.7% to an annualized 1.59 million units in September, the largest monthly decline since February. The number of single-family homes authorized for construction but not yet started - a measure of backlogs - edged lower to 144,000 in September but remains near a 15-year high. 
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IRS begins using videoconferencing to meet with big businesses
The IRS' large business division has started accepting all taxpayer requests to meet with IRS employees using secure videoconferencing, extending the practice used during the pandemic to accommodate taxpayers who sought more than meeting with an IRS employee over telephone calls. The new guidance requires Large Business and International Division (LB&I) employees to grant large business taxpayer requests for a secure video meeting with IRS-approved platforms in lieu of an in-person or telephone discussion with a compliance function. The videoconferencing move represents a step forward in the IRS’s effort to work with taxpayers in a virtual environment, including the expanded use of secure email and the launch of a virtual reading room environment to enable large LB&I taxpayers and IRS agents to share certain privileged taxpayer documents in a read-only capacity.
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Tax Authority owes Israelis $1.1bn, ombudsman says
Tax authorities in Israel owe citizens more than $1bn from excess taxes that were collected, according to the annual report on the economy and infrastructure  from the State Comptroller's Office. The ombudsman said various errors have resulted in hundreds of thousands of people missing out on benefits, and the report charged the Israel Tax Authority with not doing enough to remedy underlying problems, even though they were highlighted in an ombudsman report from 2015. “Tax money collected from citizens is private money and the state must return it. The Israel Tax Authority is not being proactive in giving tax refunds to those eligible,” State Comptroller Matanyahu Englman wrote in the report.
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