The Illinois CPA Society maintains a presence in Springfield to monitor legislation and advocate on behalf of the CPA profession in Illinois.
|
Current Legislative News Below:
|
Legislative Synopsis
The Illinois General Assembly adjourned the spring session prior to the May 31 deadline sending the Governor a partial FY 2011 state budget. Lawmakers provided Governor Quinn with broad emergency budget powers to manage state finances, borrow between state funds and securitization of $1 billion in funds from a multi-year settlement with the tobacco industry. The Senate failed to pass a $3.7 billion borrowing plan central to the state budget to make the state's pension contribution to the public pension funds for this year. Governor Quinn signed legislation for the FY 2011 state operating budget on June 30 and is expected to announce a series of severe cuts to close the $13 billion deficit. The budget bills include budget implementation bills House Bill 859 and Senate Bill 1215, pension borrowing bill Senate Bill 3514, and Senate Bill 3660 which grants the Governor emergency powers. Read Governor's veto of House Bill 859. Read Governor's press release on budget. Read allocation of lump sum appropriation by the General Assembly to the Governor's office. Read Governor's Executive Order 10 requiring additional spending reductions.
STATE LEGISLATURE RETURNS TO SPRINGFIELD FOR FALL VETO SESSION
The Illinois House returns to Springfield for the 2010 fall veto session on November 16, 17, 18, 29, 30 and December 1, and the Illinois Senate has scheduled its veto session for November 16, 17, 18, 29 and December 1 and 2.
IRS PROPOSES TAX PREPARER REGISTRATION PROGRAM
The IRS has proposed regulations about the tax preparer registration program, and the AICPA is requesting that CPAs across the country should IMMEDIATELY contact the IRS to emphasize the burdens CPAs, CPA firms and businesses will face if the IRS fully implements its proposed Tax Preparer Registration Program. While the profession supports the IRS goals, the AICPA thinks the program is moving too far, too fast, especially in the areas of non-signing preparers and requiring an exam for the registered (non-CPA) preparers. Read the regulations. An email from you to the IRS National Public Liaison will help IRS Commissioner Douglas Shulman understand why several of the proposed rules are redundant and unnecessary and how they will lead to higher tax preparation costs for taxpayers. An AICPA legislative alert, sample email and background about the IRS tax preparer registration proposal can be found here. The email should be sent IMMEDIATELY to the National Public Liaison at PublicLiaison@IRS.gov. If you have questions, please send them to IRSconcerns@aicpa.org
IRS REVISES TAX PREPARER RULES
The IRS has announced a new online application system for compensated tax return preparers which will go live in mid-September. The IRS has proposed to require all individuals who receive compensation for preparing all or substantially all of a federal tax return or claim for refund after December 31, 2010, to have a Preparer Tax Identification Number (PTIN). The IRS also proposed regulations that would amend Treasury Circular 230, the rules governing practice before the IRS. The proposed regulations generally would extend current regulations that apply to attorneys, CPAs and other specified tax professionals to all tax return preparers including currently unenrolled tax return preparers. Read IRS New Release.
State Issues
GOVERNOR SIGNS LEGISLATION TO EXTEND REGISTERED CPA OPTION
The Illinois CPA Society, working with Rep. Robert Rita (D-28, Blue Island), introduced legislation to amend the Illinois Public Accounting Act to extend the registered CPA sunset from June 30, 2010 to July 1, 2012 and to update the peer review section to conform to AICPA peer review standards. Governor Quinn signed House Bill 6415 on June 25, 2010 at the request of ICPAS. Read fact sheet. Read ICPAS letter to the Governor.
SEVENTH CIRCUIT COURT OF APPEALS ORDERS SPECIAL ELECTION FOR PRESIDENT OBAMA'S SENATE SEAT
Governor Pat Quinn recently filed the paperwork for a special election to fill President Obama's Senate seat temporarily held by Senator Roland Burris. Illinois residents will pick one Senator for a six-year term in the regular election and another to serve the final weeks of Obama's old term in the special election. The nominees up for election in the six-year term will be carried over into the special election. Read the 7th Circuit Opinion.
GOVERNOR APPOINTS THREE PEOPLE TO THE BOARD OF EXAMINERS
Governor Quinn appointed Thomas Winkler of Schaumburg, Sharon Morrow of Chicago and Dennis Bielke of Belleville to the Illinois Board of Examiners. The three-year appointments fill vacancies that existed on the BOE. Winkler is a CPA, and Morrow and Bielke serve as public members. Read more. Read more on Board of Examiners.
ILLINOIS GENERAL ELECTION TO BE HELD NOVEMBER 2
The Illinois General Election will be held on November 2, 2010. All 118 members of the Illinois House and 23 members of the Senate are up for re-election in addition to the election and special election for a U.S. Senator, Governor and remaining constitutional officers. Read more.
ILLINOIS ACCEPTS ENROLLMENT FOR NEW HIGH RISK HEALTH INSURANCE POOL
The Illinois Department of Insurance began accepting applications for the new Illinois Pre-Existing Condition Insurance Plan (IPXP), a byproduct of the federal Patient Protection and Affordable Care Act (PPACA), to serve individuals who have gone without health insurance for six months or more due to a pre-existing condition. Read more about IPXP. IPXP enrollment application.
Federal Issues
WALL STREET REFORM AND CONSUMER PROTECTION
President Obama signed the Wall Street Reform & Consumer Protection (Frank-Dodd Act) legislation into law, and it is now Public Law No. 111-203. Read more. The legislation exempted CPAs from the regulatory body when they provide usual and customary accounting services, included a GAO study of the effects of the aiding and abetting standard and gave the PCAOB the flexibility to decide if and how it wants to regulate auditors of "introducing" broker-dealers (those who do not hold client money). The bill also includes an exemption from audits of internal controls for publicly-traded companies with a market capitalization below $75 million. See update on Financial Overhaul and CPAs.
U.S. SUPREME COURT RULES ON CONSTITUTIONALITY OF THE PCAOB
The Free Enterprise Fund challenged in Court the constitutionality of the Public Company Accounting Oversight Board (PCAOB) which was originally established by the Sarbanes-Oxley Act of 2002. The basis of Free Enterprise’s suit is that PCAOB’s members should be appointed by the president rather than the SEC and should be required to be confirmed by the Senate. The Supreme Court ruled against the PCAOB in a 5-4 decision, finding that the way board members are removed by the SEC is unconstitutional. In the ruling, the Court said that limitations on the power to remove the members of the PCAOB only for cause are unconstitutional under the separation of powers doctrine. The Court found that the appointment of board members does not violate the Constitution, and it kept in place the other provisions of the the Sarbanes-Oxley Act under which the PCAOB was established. The result reverses in part, affirms in part and remands to the lowers courts. Read Journal of Accountancy article. Read the Supreme Court's opinion. Read NASBA response to ruling.
AICPA/ICPAS OPPOSES INEQUITABLE EMPLOYMENT TAX TREATMENT OF PROFESSIONAL SERVICE BUSINESSES
The AICPA and ICPAS have been working with members of the U.S. Senate in opposition to Section 413 of HR 4213 (American Jobs and Closing Tax Loopholes Act of 2010). See ICPAS letter to Senator Durbin and Senator Burris. See AICPA letter.
FTC EXTENDS ENFORCEMENT DEADLINE FOR IDENTITY THEFT RED FLAGS RULE
At the request of several members of Congress, the Federal Trade Commission (FTC) is delaying enforcement of the Red Flags Rule through December 31, 2010 so that Congress can consider legislation that would affect the scope of entities covered by the rule. The rule, in response to legislation passed by Congress intended to curb identity theft, was developed under the Fair and Accurate Credit Transactions Act in which Congress directed the FTC and other agencies to develop regulations requiring creditors and financial institutions to address the risk of identity theft. The resulting Red Flags Rule requires all such entities that have covered accounts to develop and implement written identity theft prevention programs to help identify, detect and respond to patterns, practicies or specific activities (known as red flags) that could indicate identity theft. The Red Flags Rule would require CPAs who bill clients monthly to have an internal program designed to detect, prevent and mitigate client identity theft and would have required creditors or financial institutions with covered accounts to have programs to assist in identifying potential identity theft in place by June 1, 2010 (now December 31, 2010). Read FTC news release.
ICPAS ADVOCATES FOR CPA FIRM EXEMPTIONS FROM IRS TAX PREPARER REGISTRATION AND EXAMINATION REQUIREMENTS
ICPAS President & CEO Elaine Weiss wrote to each member of the Illinois Congressional delegation urging members to contact the IRS Commissioner and request CPA firms be exempted from registering non-signing tax preparers and delay the implementation of the IRS preparer examination for non-signing preparers. See ICPAS letter. See AICPA substantive points. Members of Congress sent a letter to Secretary of the Treasury Geithner, signed by 31 members of Congress, requesting that the Treasury Department and the IRS exempt CPA firms from the requirement to register persons working in CPA firms who do not sign a tax return (non-signing preparers) and to delay implementation of the IRS preparer exam until it has been demonstrated that return preparer exams are necessary. Read Congressional letter.
IRS PROPOSES NEW PREPARER REGISTRATION
The Internal Revenue Service released its recommendations regarding tax preparer regulations on Jan. 4. The IRS recommends a number of steps that it plans to phase in beginning with the 2011 filing season:
- All preparers use a common identification number (a “PTIN” number).
- All authorized tax preparers would pay a $50 annual fee to obtain or renew the PTIN number. The fee would be on top of a "reasonable fee" charged by a third-party vendor that will administer the application and renewal process. The new fee will be effective on the date the proposed regulations are finalized. Read more.
- All preparers be subject to Circular 230 requirements.
- An education requirement be implemented – CPAs would be exempt from this requirement.
- An entry testing requirement be implemented – CPAs would be exempt from this requirement.
The IRS will assess the CPE and entry-level testing exemptions for CPAs (and enrolled agents and attorneys) at a later time. The AICPA has been in discussion with IRS and congressional officials on this matter and supports that IRS plan to register all preparers. Read more. ICPAS Taxation Executive Committee submitted extensive comments in response to the IRS’ request for comments and participated in an IRS Public Forum held in Chicago on Sept. 30. Read more. Read more on IRS proposal.
The IRS is also in the process of sending approximately 10,000 letters to tax return preparers about errors the service frequently sees on specific types of returns. Read more.
The IRS has published questions and answers on the impact of the proposed regulations on registered and public accountants. Read more.
AICPA SUBMITS COMMENTS ON ISSUANCE OF PREPARER TAX ID NUMBERS
The AICPA's Tax Executive Committee submitted formal comments in response to the Internal Revenue Service's Proposed Regulations Relating to the Issuance of Preparer Identification Numbers by the IRS to Tax Return Preparers. Read cover letter. Read AICPA comments.
AICPA RESPONDS TO IRS ANNOUNCEMENTS ON UNCERTAIN TAX POSITIONS
The AICPA has responded to the IRS disclosure of uncertain tax positions. Read AICPA comments.
ICPAS OPPOSES AMENDING SOX SECTION 404(b) REQUIREMENTS IN RESTORING AMERICAN FINANCIAL STABILITY ACT
ICPAS President and CEO Elaine Weiss has sent letters to Illinois Senators Durbin and Burris in opposition to exempting some public companies from Section 404(b) requirements of the Sarbanes-Oxley (SOX) Act of 2002. Read letter.
Regulatory Issues
ILLINOIS DEPARTMENT OF REVENUE ADDS COMMON ERRORS ON BUSINESS TAX RETURNS
The Department of Revenue recently added a new section to their website that highlights common errors that its Audit Division finds on audits of business taxpayers. They also will be issuing Compliance Alerts in the future which will identify issues they find in both audits and processing of returns. Read More.
ILLINOIS BOARD OF EXAMINERS UPDATES ADMINISTRATIVE RULES ON EDUCATIONAL REQUIREMENTS
The Illinois Board of Examiners has proposed updated administrative rules for educational requirements to sit for the uniform CPA examination. The proposed rules provide for a new definition section that further defines terms used throughout Chapter 23, Section 1400.90 of the Administrative Code. The rules further clarify classes that will be accepted for the 150 semester credit hour requirements and accounting course requirements. See proposed rules. See current rules. The Board of Examiners has proposed an effective date of July 2013 to allow adequate time for colleges and universities to implement the change and to allow current students in the pipeline to complete course requirements.
Government Relations Office
LEGISLATIVE CONTACT PROGRAM
Members of the Legislative Contact Program were called upon to assist with the passage of Senate Bill 1970 out of the Senate Judiciary Committee, full Senate Chamber, House Judiciary Committee and the full House Chamber. Strategic legislative alerts were sent to legislative contacts asking them to contact committee members for passage out of committee and the full Senate and House. Legislative contacts have been responsive in contacting members of the General Assembly.
Legislative contacts are needed for the following state officials:
Representatives: Senator:
Edward Acevedo (D-2, Chicago) John Sullivan (D-47, Rushville)
Mary Flowers (D-31, Chicago)
Andre Thapedi (D-32, Chicago)
Ed Sullivan, Jr. (R-51, Mundelein)
Call 800.572.9870 or send an email to BrickerC@icpas.org to volunteer to be a legislative liaison to these and/or other legislators. Read more about the program.
MOBILITY UPDATE
Public Act 95-0386 became effective on January 1, 2008. The original legislation, Senate Bill 745, was a society initiative to bring mobility to Illinois. The Government Relations staff has been working with the Illinois Department of Financial and Professional Regulation on mobility implementation and has developed informational questions and answers to assist practitioners in resolving mobility issues. Mobility and/or licensure questions may be directed to the Government Relations office at 217.789.7914 or 800.572.9870 or email Jill Loeser. See National Association of State Boards of Accountancy State Mobilty Law Index.
The staff in the ICPAS Springfield office strives to keep you informed of all legislation and regulations that impact the accounting profession in Illinois. Contact:
Marty Green, Vice President, Government Relations
800.572.9870 (IL only) or 217.789.7914
|
- Legislative Issues
- Regulation & Legislation Committee
- Illinois CPAs for Political Action
|
Connie McKamy, Director, Legislative Contact and Communications
800.572.9870 (IL only) or 217.789.7914
|
- Capitol Assets
- Events for Legislators
- Illinois CPAs for Political Action
- Legislative Issues
- Legislative Contact Program
- Regulation & Legislation Committee
|
Jill Loeser, Manager, Government Relations
800.572.9870 (IL only) or 217.789.7914
|
- Certification, Licensing & Registration
- Registration for Legislative Events
- Status of Illinois Legislation
|