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Accountancy Slice
USA
29th May 2026
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THE HOT STORY

IRS renews syndicated easement settlement offer as litigation risks mount

The IRS has introduced a new settlement initiative for syndicated conservation easement transactions, maintaining the core economic framework of previous offers while implementing procedural changes. Investors must evaluate their partnership's litigation risks before deciding on the settlement, which allows partners to retain a deduction equal to their investment, pay a 10% penalty on the new tax, and incur interest from the original due date. The offer is valid for 90 days, after which penalties increase. Notably, the IRS will extend this offer to all partnerships, including those that previously declined it. John Kirbo, a senior attorney at Wiggam Law, emphasizes that “investors should calculate what a rejected offer followed by a loss at trial could cost.” Investors are encouraged to weigh the potential costs of litigation against the settlement offer.

VALUE PRICING

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TAX

Warren calls for new AI taxes to spread benefits beyond tech billionaires

Sen. Elizabeth Warren (D-MA) has proposed new taxes on artificial intelligence companies and data centers, arguing that the economic gains from AI should “benefit all Americans” rather than a small group of wealthy technology executives and investors. In an op-ed published in Time magazine, she calls for a redesign of the U.S. tax system to address AI-driven wealth creation, rising energy demands, and job displacement. Warren proposes an excise tax tied to the electricity consumption of AI data centers, saying the revenue could help offset rising utility costs for households. She argues that current tax policies favor automation over hiring workers by effectively giving companies tax advantages for investing in equipment and AI systems instead of human labor. Warren also suggests broader future taxes on AI companies, although she did not provide additional details.

Boston targets AI talent with push against California billionaire tax proposal

Massachusetts is striving to retain its artificial intelligence (AI) talent, which often migrates to Silicon Valley for better opportunities. With prestigious institutions like Harvard and MIT, the state has a wealth of potential, yet none of the top 20 venture-backed AI companies are based there. The proposed 5% wealth tax on billionaires in California could change this dynamic, as startup founders may face significant financial burdens. Ankit Gupta from Y Combinator warned, "There are startup founders that can just straight-up go bankrupt from this." Massachusetts leaders, including Governor Maura Healey, are actively promoting the state to Silicon Valley investors, emphasizing its talent pool and innovation potential. The Massachusetts AI Coalition aims to double the number of billion-dollar tech companies in the state over the next five years, fostering a supportive ecosystem for startups.

Newsom pledges 100% tax on Californians receiving Trump’s $1.8bn fund

California Gov. Gavin Newsom has announced plans to tax 100% of the funds Californians receive from President Trump's $1.776bn “anti-weaponization” fund. “Anyone from California that receives any of those funds, we want to tax 100% of those proceeds,” Newsom said. The fund, which is aimed at compensating Trump allies claiming victimization under the Biden administration, has drawn criticism from both Democrats and some Republicans, including Senator Mitch McConnell, who labeled it a “slush fund.” Newsom's tax proposal would require action from the Democratic-led California Legislature and may face legal challenges. Additionally, he signed Senate Bill 73 to prevent election interference, addressing concerns over threats to election integrity. Newsom anticipates further interference from Trump in the upcoming election, saying: “I absolutely expect the worst again.”

New York approves pied-à-terre tax on luxury second homes

New York lawmakers have approved a new pied-à-terre tax targeting luxury second homes in New York City, marking a victory for Mayor Zohran Mamdani’s push to raise more revenue from wealthy property owners. The tax, included in the state budget and effective July 1st, applies to second homes valued at $5m or more. State officials estimate it could generate up to $500m annually, with around 10,000 properties expected to be affected. Gov. Kathy Hochul, who had publicly opposed broader tax increases on high-income earners and corporations, backed the measure as a way to raise revenue from ultrawealthy nonresidents while avoiding wider tax hikes. The levy could add tens of thousands of dollars annually to owners of qualifying properties, while owners of ultra-luxury residences could face tax bills exceeding $1m per year. 

INDUSTRY

PCAOB launches Inspections Modernization Council

The PCAOB is establishing the Inspections Modernization Council (IMC) to enhance its oversight activities. The council aims to gather insights from experts in capital markets and the PCAOB's inspection program, with applications closing on June 15th. PCAOB Chair Demetrios Logothetis said: "Modernization of PCAOB inspections has the potential to bring improved audit quality and other significant benefits to investors and other stakeholders." The IMC will consist of up to 12 members serving in personal capacities, focusing on firmwide quality control systems rather than just isolated engagement deficiencies. Richard Chambers, senior advisor at Optro, anticipates a shift in PCAOB's approach to audit quality under its current leadership.

ECONOMY

Weekly jobless claims edge higher as layoffs remain limited

Initial claims for U.S. unemployment benefits rose modestly last week, indicating layoffs remain relatively low despite economic uncertainty linked to the ongoing Iran conflict. The Labor Department said initial jobless claims increased by 5,000 to a seasonally adjusted 215,000 in the seven days to May 23rd, slightly above economists’ expectations of 211,000. Claims have largely remained within a 190,000 to 230,000 range throughout 2026. The four-week moving average rose to 209,000 while continuing claims, reported with a one-week lag, increased 15,000 to a seasonally-adjusted 1.786m. “Initial jobless claims continue to run below year-ago levels," commented economist Eliza Winger. "Expectations of AI-driven automation and heightened geopolitical uncertainty haven’t had a meaningful impact on weekly unemployment insurance claims activity so far.”

U.S. Q1 GDP growth revised down to 1.6%

The U.S. economy grew at an annualized rate of 1.6% in the first quarter of 2026, revised down from an earlier estimate of 2%, according to updated Commerce Department data. The downgrade was primarily driven by weaker inventory investment, while consumer spending growth was also revised lower. Consumer spending increased at a 1.4% annual rate during the quarter, down from the prior estimate of 1.6%, with softer spending on services such as healthcare contributing to the revision. Despite slower economic growth, corporate profits remained strong. Profits after tax, excluding inventory valuation and capital consumption adjustments, rose 3.3% from the previous quarter and climbed 17% year over year, marking the strongest annual increase since the fourth quarter of 2021.

New home sales fell sharply in April

Sales of new U.S. single-family homes fell 6.2% in April to an annualized rate of 622,000, missing economists’ forecasts and signaling continued weakness in the housing market despite aggressive builder incentives. Government data showed sales declined more sharply than the 660,000 pace expected by economists, as higher mortgage rates and affordability concerns continued to weigh on buyers during the spring selling season. The housing sector has struggled through a prolonged downturn, with builders attempting to stimulate demand through lower-priced homes and incentives. However, rising borrowing costs and financial pressure on lower-income households have continued to limit activity. The inventory of new homes for sale eased to 489,000 in April, representing a 9.4-month supply at the current sales pace. Meanwhile, the median sales price for a new home rose 2.2% year over year to $422,500, driven by stronger sales in the $400,000 to $500,000 price range. Regional performance was mixed. Sales in the South, the nation’s largest housing market, fell nearly 10%, while Midwest sales dropped 25% to their lowest level in more than a year. In contrast, sales in the West climbed 18.7% to the fastest pace since October.

LEGAL

U.S. Tax Court upholds 40% penalty in microcaptive insurance case

A U.S. Tax Court judge has ruled that businessman Curtis Kadau must pay a 40% penalty, rather than the standard 20%, on tax underpayments tied to a microcaptive insurance arrangement that used a life insurance policy and annuity as its primary investments. Judge Christian Weiler found that the arrangement lacked economic substance and was not adequately disclosed on tax returns filed between 2012 and 2015. The court said the structure appeared to function more as an estate-planning vehicle than a legitimate insurance arrangement designed to hedge business risk. Kadau, owner of Surface Engineering & Alloy Co., established the microcaptive insurer in Nevis in 2012 following advice from financial advisors. The captive insurer was funded through a $6m life insurance policy and an annuity. The IRS argued the insurance premiums paid into the arrangement were significantly higher than comparable commercial insurance premiums. The decision could have implications for advisors and taxpayers using life insurance policies or annuity contracts within microcaptive insurance structures, with experts suggesting affected clients review arrangements with tax counsel.

PERSONAL FINANCE

Treasury launches Trump Accounts app ahead of nationwide rollout

The U.S. Treasury Department has launched the Trump Accounts app nationwide, advancing a Trump administration initiative aimed at creating investment accounts for millions of American children. The program, established under President Donald Trump’s “One Big Beautiful Bill Act,” is scheduled to officially launch on July 4th. Under the plan, the Treasury will deposit $1,000 into investment accounts for children born between 2025 and 2028 who have valid Social Security numbers. Treasury Secretary Scott Bessent said the app will allow families to open accounts, contribute funds, and track investment growth, describing the initiative as a way to expand financial access and encourage long-term wealth building. The app was developed in partnership with trading platform Robinhood and custodian bank BNY. The administration has also encouraged private companies to contribute to accounts for employees’ children. JPMorgan Chase, Wells Fargo, Bank of America, and Visa are among the firms that have pledged support for the program.

TECHNOLOGY

OpenAI Foundation commits $250m to help workers navigate AI disruption

OpenAI’s foundation, the non-profit that controls the start-up, has said it will grant $250m to promote research into AI’s impact on the economy and jobs. The ‌funds will support research into AI's impact on the labor market, support workers and communities facing near-term displacement and ​explore new ways to distribute economic gains from the technology more ​broadly. "The current pace of change means the window to get ⁠this right is shorter than we're used to, and the ​cost of getting it wrong is profound," OpenAI said in a statement.

INTERNATIONAL

KPMG Australia’s CEO resigns amid whistleblower claims

Andrew Yates, chief executive of KPMG Australia, has resigned after the accounting firm said investigations into a whistleblower’s claims had fallen short of its standards. It was alleged that KPMG improperly used confidential information from its client Lendlease to win audit work with Westpac and Dexus, and that it had repeatedly failed to act on the whistleblower’s complaint. “The initial internal investigation, that did not substantiate the allegations raised by the whistleblower, was in hindsight not conducted with the necessary rigour required,” the firm said in a statement, adding that an external investigation into the whistleblower’s complaints by law firm Allens would continue “with new evidence and an expanded scope.” KPMG said it was “continuing to challenge the conclusions reached in prior investigations.”

Europe 'less able than U.S. to contain crypto-bank shocks'

Elena Carletti, UniCredit's deputy vice chair and head of the board's ​risk committee, has said Europe may struggle to respond to risks from links between crypto assets and lenders in the way U.S. authorities contained ​damage during the 2023 Silicon Valley Bank (SVB) crisis. "The coverage and protection . . . was given to all ​deposits, including stablecoin companies, and that also allowed to maintain the stability of the ‌stablecoin," ⁠Carletti told attendees at a banking conference organized by Madrid's IESE business school.  "The same decision cannot be easily taken in Europe," she said.
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