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A new TIGTA report evaluating the IRS' efforts to modernize its Income Verification Express Service (IVES) program has found that it failed to create an online system by January 2023, as stipulated by the 2019 Taxpayer First Act (TFA). The IVES system is often used in connection with mortgage applications and other types of loans. The IRS provides return transcript, W-2 transcript and 1099 transcript information generally within approximately two to three business days to mortgage lenders and other third parties with the taxpayer's consent. The TFA aimed to speed up that process by allowing electronic transcript requests, but the IRS still has not met the goal of providing an online system by January of this year. "Despite the Taxpayer First Act requiring the IRS create a new online system to process transcript requests, IRS management has not yet made a decision to require participants to use the new system," said the report. "Until the modernized IVES system becomes mandatory to use, enhanced controls will be needed for electronically faxed transcript requests to ensure that transcripts are not issued to unauthorized individuals." Additionally, TIGTA found that not enough information is being provided to participants and taxpayers. TIGTA made 14 recommendations in the report to modernize and improve the IVES program, including alerts issued to IRS management during the review to address concerns such as ensuring the development of business transcript capability for the modernized IVES system. The IRS agreed with 11 of them, and noted recent improvements to the system, including two new components, the IVES Application Programming Interface and Web-based User Interface.

 

Accounting Today

All services except "Send Submissions" will be unavailable for the IRS' Modernized e-File (MeF) production and testing systems on Sunday from 12:01 a.m. until 10 a.m. Eastern. During this maintenance period, MeF will accept submissions but will not generate acknowledgements or process any state services such as Get Submissions, Send Acknowledgements or Send Receipts. The IRS noted, however, that the MeF Assurance Testing System will be operational during the cutover.

 

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Applications for unemployment benefits fell last week, showing the U.S. labor market remains strong as other signs point to a cooling economy. The Labor Department said that initial jobless claims decreased by 20,000 to a seasonally adjusted 192,000 in the seven days to March 11th. The prior week's claims had increased by 22,000, revised data show, in part due to a jump in New York, where there was a school break. The four-week average of weekly claims fell slightly last week to 196,500, a historically low level. Continuing claims, reported with a one-week lag, decreased by 29,000 to 1.68m. There were notable declines in filings in California, Georgia, Oregon and Minnesota. Claims rose significantly in Indiana and Ohio. Despite job cuts by major technology companies, the labor market has remained resilient, with employers seemingly reluctant to lay off workers after struggling to find labor during the COVID-19 pandemic. “Labor market conditions remain exceptionally tight,” said lead U.S. economist Michael Pearce of Oxford Economics. “There are still few signs that the pick-up in announced layoffs in recent months, particularly in the tech sector, is feeding through to a rise in unemployment. Many announced layoffs don’t end up happening, and those that have been laid off are quickly finding work elsewhere, reflecting the ongoing imbalance between labor demand and supply,” he added.

 

Market Watch

Reuters

Wall Street Journal

U.S. supplier prices fell in February from a month earlier, a possible sign of a recent easing in inflationary pressures. The Labor Department's producer-price index, a reflection of supply conditions across the country, fell 0.1% in February from the prior month. In the 12 months through February, the PPI increased 4.6% after rising 5.7% in January. Economists polled by Reuters had forecast the PPI gaining 0.3% on the month and advancing 5.4% year-on-year. Excluding food, energy and trade, the index rose 0.2%, down from the 0.5% gain in January. On an annual basis, that reading was up 4.4%.

 

CNBC

Reuters

Wall Street Journal

More than $2bn was transferred to Sam Bankman-Fried from FTX entities, according to bankruptcy court filings made by the new management of the cryptocurrency exchange on Wednesday night. Mr. Bankman-Fried and five members of his inner circle transferred a total of $3.2bn to their personal accounts in the form of “payments and loans.” The money primarily came from Alameda Research, a crypto trading hedge fund affiliated with FTX. Mr. Bankman-Fried faces 12 federal charges and is awaiting trial after pleading not guilty to fraud.

 

Fox News

Financial Times

The Guardian

PCAOB officials are to begin a fresh round of inspections in Hong Kong on Chinese companies' auditors as soon as next week. A group of Chinese officials will be dispatched by the China Securities Regulatory Commission and the Ministry of Finance to assist the inspection of work by EY, Deloitte, PwC and other firms. The first inspections were carried out last year, removing the immediate risk that around 200 Chinese companies could be booted off U.S. stock exchanges. Under the PCAOB's inspection guidelines, in general, each auditing firm is subject to inspection either annually, if the firm provides audit opinions for more than 100 issuers, or otherwise once every three years, said Jessica Zhou, partner at law firm White & Case. PCAOB staff identified "numerous potential deficiencies" in their inspection work last year, and inspection reports will be finalised and made public this year.

 

Reuters

Amazon has argued that the EU decision ordering the firm to pay about €250m in back taxes is without merit. In 2017, the European Commission said a Luxembourg tax arrangement, codenamed Project Goldcrest by the firm, allowed Amazon to channel profits to a holding company tax-free, meaning it paid no taxes on almost three-quarters of its profits from EU operations. The online retailer challenged the EU tax order in 2021, convincing a tribunal to scrap the back tax ruling. The commission has since appealed to Europe's highest court, the Court of Justice of the European Union. 

 

Reuters

The Seattle Times

The National Retail Federation says that St. Patrick's Day spending in the U.S. could hit $6.9bn this year, an all-time high since the retail collective began surveying consumers about their March 17th plans more than a decade ago. Average per-person spending is projected to be $43.84, with men expected to spend almost $10 more than women. 

 

Market Watch