Accounting
At the end of a smooth tax season, an uncertain home stretch
Published
2 days agoon

Although filing season began smoothly and proceeded with little fanfare, there are still some issues that are on the minds of tax pros.
“While it began looking like a smooth year, it has been anything but,” said, according to Misty Erickson, tax content manager at the National Association of Tax Professionals. She listed the following as contributing to the angst felt by many preparers:
- With
the IRS laying off employees , there are a lot of questions on how this will impact the filing season. The IRS will shift staff to help with return processing, but if a return stops for review, or if it is paper filed, there may be a delay. To help combat this, tax pros should double check the return before filing and compare last year’s return to this year’s; they should also ask about any missing income or other discrepancies. - There’s also concern about the likelihood of delayed response from the agency. Erickson recommended using online tools whenever possible. The IRS has online accounts for individuals, businesses and tax professionals that can be utilized to reduce the need to call for assistance. Those who need to call should expect to be on hold for some time
- Dealing with current law versus campaign rhetoric around not taxing overtime, tips, or Social Security. Until these promises become law there will be no changes. The challenge, Erickson warned, will be to convince clients that even though this has been in the news, it is not certain until it is signed into law.
Beneficial ownership information reporting for small businesses is an ever-changing landscape. Any enforcement actions have currently been suspended, and it appears that the focus will be on foreign entities reporting their BOI.
There has not been a lot of last-minute legislative changes, so the chores this tax season have revolved around all the other compliance work layered in, according to Kelly Myers, of Myers Consulting Group LLC, who spent 30 years at the IRS, including 20 as a senior technical advisor at the SB/SE Division.
(Read more:
“A lot is crystal ball work — how to make strategic decisions to minimize the tax effect influencing future returns,” he said. “The IRS is still trying to process Employee Retention Credits, with taxpayers waiting for refunds. There are ERCs from 2020 still in the queue. Meanwhile the statute of limitations is running, so make sure to get the claim in before it runs.
“There was a bit of a domino effect,” he added. “When they released 6,700 employees, it caused compliance efforts to stop. People have called in regarding an audit and were told that it had gone on hold until further notice. They had new and probationary hires working on audits, but now those are gone.”

“The reality is we really don’t know what the future holds regarding people getting reinstated,” said Myers. It’s a season of adjustment — that’s different because the technical side of tax season is not here. When four probationary hires leave, the audits they were working have to go to someone. What do you do with clients when the IRS has shortages in the field causing the process to change? It affects filing season indirectly because things take a lot more time when the practitioner is dealing with the ripple effect of IRS staffing.”
Myers praised industry associations and professional organizations for stepping up and providing free membership and advice to departing IRS agents and outgoing staff to help them land jobs.
Waiting for the other shoe to drop
“We have had no major issues or delays,” said Mark Steber, chief tax Officer at Jackson Hewitt Tax Services. “As with IRS guidance, we continue to see refunds being issued for nine out of 10 taxpayers within 21 days, and in many cases even faster than that. We also have not had any disruption in communication with the IRS.”
Bill Nemeth, immediate past president and education chair of the Georgia Association of Enrolled Agents, agreed.
“E-filed returns are being accepted and refunds are being disbursed in a timely fashion just like we would expect,” he observed. “But as we get deeper into filing season, we may have more complicated paper returns that we have to mail in, and we are concerned whether they will be processed in a timely fashion. Someone has to open the envelope, and read and review the return. That’s our biggest concern — it’s still early but we are crossing our fingers.”
“Another concern is that tax revenues may be down 10% this year. If the IRS is not going to pursue people, fewer will file or file correctly,” he added.
Nemeth files an extension for every return. “I then file the return later on. If I discover by looking at the transcript if something was left out, I can file a superceding return — a replacement return. Some people had two jobs in 2024 and forgot one of them. Kids are terrible at giving documents to their preparer, especially 1098-T,” he observed.
“When we call the IRS, the answering assister will give their name and employee number,” Nemeth remarked. “New employees start with ‘100,’ which means that you’re talking to a ‘newbie’ that may not know what they’re doing. I always prefer to speak to someone with a number that begins with a number over ‘100’ that has been there awhile.”
“If you’re talking to a newbie, a polite way to end the call is simply to hang up while you’re talking,” he suggested. “It sounds like an equipment failure on your end as opposed to saying, ‘You don’t know what you’re doing.’ The other trick is calling during lunch time. Managers will often answer their own phone, and they’re the ones you want to talk to. They can make decisions while clerks cannot.”
BOI, EV, Etc.
“The Treasury said they would not enforce the BOI requirements to file, so that’s taken a load off a lot of preparers,” said Stephen Mankowski of Mankowski Associates CPA LLC, a former tax chair of the National Conference of CPA Practitioners. “It was absolutely the right call, since there was no way they were going to get 20 million-plus reports filed, especially during filing season. It was almost as if they were setting us up just to be able to issue a whole lot of fines. The AICPA did a lot on their end. We don’t know if they might come up with something after filing season. I don’t know what filing that report has to do with money laundering because the bad guys will not file.”
“If you were a money launderer would you file?” he asked. “They were just going to get a bunch of moms-and-pops, with carve outs for really small businesses. So keep on top of it pending further action, but for now nothing needs to be done.”
The majority of returns are getting accepted and refunds are being issued in a timely manner, Mankowski said: “We always get a couple of juicy rejects, but even with those, we know what to do to get things resolved. That’s been good so far. The only potential hiccup is the giant elephant in the room: how the reduction in force at the IRS will affect filing season. I’ve been fortunate not to have to call the IRS, but I’ve heard mixed reviews. Some had a hard time while others have gotten straight through.”
The bigger issue is how it will play out with IRS employees at retirement age. “The problem is when people take retirement, they have the knowledge base that goes along with their career,” he explained. “‘Probationary’ just means new to a specific department or a switch from IRS to Treasury, but when all is said and done you could have 10 years and be viewed as probationary. The fact that the IRS is putting together a workforce reduction plan during tax season is almost a power play to other departments — they can say if the IRS is doing this, what’s your problem?”
Tax attorney Barbara Weltman, author of J.K. Lasser’s Small Business Taxes 2025, noted that, new for 2024, the clean vehicle credit for buying new electric vehicles and the previously owned clean vehicle credit for used EVs can effectively be “sold” to the dealer to reduce the purchase price of the EV.
“Opting to transfer the credit to the dealer means the taxpayer does not have to wait to file a return in order to reap the tax savings from the credit,” she said. “The Treasury says that about 90% of the qualifying consumers buying a new EV have transferred their credits to dealers. But the taxpayer must file Form 8936 and Schedule A of this form. The taxpayer should have received a time-of-sale report from the dealer, which has information necessary to complete the form and schedule.”
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Accounting
Accountants tackle tariff increases after ‘Liberation Day’
Published
8 minutes agoon
April 3, 2025
President Trump’s imposition of steep tariffs on countries around the world is likely to drive demand for accounting experts and consultants to help companies adjust and forecast the ever-changing percentages and terms.
On April 2, which Trump dubbed “Liberation Day,” he announced a raft of reciprocal tariffs of varying percentages on trading partners across the globe and signed an
“A lot of CFOs are thinking they are going to pass along the tariffs to their customer base, and about another half are thinking we’re going to absorb it and be more creative in other ways we can save money inside our company,” said Tom Hood, executive vice president for business engagement and growth at the AICPA & CIMA.
The AICPA & CIMA’s most recent
“CFOs in our community are telling us that, effectively, they’re looking at this a lot like what happened over COVID with a big disruption out of nowhere,” said Hood. “This one, they could see it coming. But the point is they had to immediately pivot into forecasting and projection with basically forward-looking financial analysis to help their companies, CEOs, etc., plan for what could be coming next. This is true for firms who are advising clients. They might be hired to do the planning in an outsourced way, if the company doesn’t have the finance talent inside to do that.”
The tariffs are not set in stone, and other countries are likely to continue to negotiate them with the U.S., as Canada and Mexico have been doing in recent months.
“The one thing that I think we can all count on is a certain amount of uncertainty in this process, at least for the next several months,” said Charles Clevenger, a principal at UHY Consulting who specializes in supply chain and procurement strategy. “It’s hard to tell if it’s going to go beyond that or not, but it certainly feels that way.”
Accountants will need to make sure their companies and clients stay compliant with whatever conditions are imposed by the U.S. and its trading partners. “This is a more complex tariff environment than most companies have experienced in the past, or that seems to be where we’re headed, and so ensuring compliance is really important,” said Clevenger.
Big Four firms are advising caution among their clients.
“Our point of view is we’re advising all of our clients to do a few things right out of the gate,” said Martin Fiore, EY Americas deputy vice chair of tax, during a webinar Thursday. “Model and analyze the trade flows. Look at your supply chain structures. Understand those and execute scenario planning on supply chain structures that could evolve in new environments. That is really important: the ability for companies to address the questions they’re getting from their C-suite, from their stakeholders, is critical. Every company is in a different spot according to the discussions we’ve had. We just are really emphasizing, with all the uncertainty, know your structure, know your position, have modeling put in place, so as we go through the next rounds of discussions over many months, you have an understanding of your structure.”
Scenario planning will be especially important amid all the unpredictability for companies large and small. “They’re going to be looking at all the different countries they might have supply chains in,” said Hood. “And then even the smaller midsized companies that might not be big, giant global companies, they might be supplying things to a big global company, and if they’re in part of that supply chain, they’ll be impacted through this whole cycle as well.”
Accountants will have to factor the extra tariffs and import taxes into their costs and help their clients decide whether to pass on the costs to customers, while also keeping an eye out for pricing among their competitors and suppliers.
“It’s just like accounting for any goods that you’re purchasing,” said Hood. “They often have tariffs and taxes built into them at different levels. I think the difference is these could be bigger and they could be more uncertain, because we’re not even sure they’re going to stick until you see the response by the other countries and the way this is absorbed through the market. I think we’re going through this period of deeper uncertainty. Even though they’re announced, we know that the administration has a tendency to negotiate, so I’m sure we’re going to see this thing evolve, probably in the next 30 days or whatever. The other thing our CFOs are reminding us of is that the stock market is not the economy.”
Amid the market fluctuations, companies and their accountants will need to watch closely as the rules and tariff rates fluctuate and ensure they are complying with the trading rules. “Do we have country of origin specified properly?” said Clevenger. “Are we completing the right paperwork? When there are questions, are we being responsive? Are we close to our broker? Are we monitoring our customs entries and all the basic things that we need to do? That’s more important now than it has been in the past because of this increase in complexity.”
Accounting
How to use opportunity zone tax credits in the ‘Heartland’
Published
41 minutes agoon
April 3, 2025
A tax credit for investments in low-income areas could spur long-term job creation in overlooked parts of the country — with the right changes to its rules, according to a new book.
The capital gains deferral and exclusions available through the “opportunity zones” credit represent one of the few areas of the Tax Cuts and Jobs Act of 2017 that drew support from both Republicans and Democrats. The impact of the credit, though, has proven murky in terms of boosting jobs and economic growth in the roughly 7,800 Census tracts qualifying based on their rates of poverty or median family incomes.
Altering the criteria to focus the investments on “less traditional real estate and more innovation infrastructure” and ensuring they reach more places outside of New York and California could “refine the where and the what” of the credit, said Nicholas Lalla, the author of “
“I don’t want to sound naive. I know that investors leveraging opportunity zones want to make money and reduce their tax liability, but I would encourage them to do a few additional things,” Lalla said. “There are communities that need investment, that need regional and national partners to support them, and their participation can pay dividends.”
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A call to action
In the book, Lalla writes about how the Innovation Labs received $200 million in fundraising through public and private investments for projects like a startup unmanned aerial vehicle testing site in the Osage Nation called the Skyway36 Droneport and Technology Innovation Center. Such collaborations carry special relevance in an area like Tulsa, Oklahoma, which has a history marked by the wealth ramifications of the
“This book is a call to action for the United States to address one of society’s defining challenges: expanding opportunity by harnessing the tech industry and ensuring gains spread across demographics and geographies,” he writes. “The middle matters, the center must hold, and Heartland cities need to reinvent themselves to thrive in the innovation age. That enormous project starts at the local level, through place-based economic development, which can make an impact far faster than changing the patterns of financial markets or corporate behavior. And inclusive growth in tech must start with the reinvention of Heartland cities. That requires cities — civic ecosystems, not merely municipal governments — to undertake two changes in parallel. The first is transitioning their legacy economies to tech-based ones, and the second is shifting from a growth mindset to an inclusive-growth mindset. To accomplish both admittedly ambitious endeavors, cities must challenge local economic development orthodoxy and readjust their entire civic ecosystems for this generational project.”
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Researching the shortcomings
And that’s where an “opportunity zones 2.0” program could play an important role in supporting local tech startups, turning midsized cities into innovation engines and collaborating with philanthropic organizations or the federal, state and local governments, according to Lalla.
In
Other research suggested that opportunity-zone investments in metropolitan areas generated a 3% to 4.5% jump in employment, compared to a flat rate in rural places,
“It creates a strong incentive for taxpayers to make investments that will appreciate greatly in market value,” Tax Foundation President Emeritus Scott Hodge wrote in the analysis, “Opportunity Zones ‘Make a Good Return Greater,’ but Not for Poor Residents” shortly after the Treasury study.
“This may be the fatal flaw in opportunity zones,” he wrote. “It explains why most of the investments have been in real estate — which tends to appreciate faster than other investments — and in Census tracts that were already improving before being designated as opportunity zones.”
So far, three other research studies have concluded that the investments made little to no impact on commercial development, no clear marks on housing prices, employment and business formation and a notable boost in multifamily and other residential property,
The credit “deviates a lot from previous policies” that were much more prescriptive, Feldman said.
“It didn’t want the government to have a lot of oversay over what was going on, where the investment was going, the type of investments and things like that,” she said. “It offered uncapped tax incentives for private individual investors to invest unrealized capital gains. So this was the big innovation of OZs. It was taking the stock of unrealized capital gains that wealthy individuals, or even less wealthy individuals, had sitting, and they could roll it over into these funds that could then be invested in these opportunity zones. And there were a lot of tax breaks that came with that.”
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A ‘place-based’ strategy
The shifts that Lalla is calling for in the policy “could either be narrowing criteria for what qualifies as an opportunity zone or creating force multipliers that further incentivize investments in more places,” he said. In other words, investors may consider ideas for, say, semiconductor plants, workforce training facilities or data centers across the Midwest and in rural areas throughout the country rather than trying to build more luxury residential properties in New York and Los Angeles.
While President Donald Trump has certainly favored that type of economic development over his career in real estate, entertainment and politics, those properties could tap into other tax incentives. And a refreshed approach to opportunity zones could speak to the “real innovation and talent potential in midsized cities throughout the Heartland,” enabling a policy that experts like Lalla describe as “place-based,” he said. With any policies that mention the words “
“We can’t have cities across the country isolated from tech and innovation,” he said. “When you take a geographic lens to economic inclusion, to economic mobility, to economic prosperity, you are including communities like Tulsa, Oklahoma. You’re including communities throughout Appalachia, throughout the Midwest that have been isolated over the past 20 years.”
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Hope for the future?
In the book, Lalla compares the similar goals of opportunity zones to those of earlier policies under President Joe Biden’s administration like the Inflation Reduction Act, the CHIPS and Science Act, the American Rescue Plan and the Infrastructure Investment and Jobs Act.
“Together, these bills provided hundreds of millions of dollars in grant money for a more diverse group of cities and regions to invest in innovation infrastructure and ecosystems,” Lalla writes. “Although it will take years for these investments to bear fruit, they mark an encouraging change in federal economic development policy. I am cautiously optimistic that the incoming Trump administration will continue this trend, which has disproportionately helped the Heartland. For example, Trump’s opportunity zone program in his first term, which offered tax incentives to invest in distressed parts of the country, should be adapted and scaled to support innovation ecosystems in the Heartland. For the first time in generations, the government is taking a place-based approach to economic development, intentionally seeking to fund projects in communities historically disconnected from the nation’s innovation system and in essential industries. They’re doing so through a decidedly regional approach.”
Advisors and
“This really is a bipartisan issue. Opportunity zones won wide bipartisan approval,” he said. “Heartland cities can flourish and can do so in a complicated political environment.”
Accounting
Ramp releases tool to detect fraudulent AI-generated receipts
Published
1 hour agoon
April 3, 2025
Dave Wieseneck, an “expert in residence” at Ramp who administers the company’s own instance of Ramp, noted that faking receipts is not a new practice. What’s changed is that, with the recent
“So while it’s always been possible to create fake receipts, AI has made it super duper easy, especially OpenAI with their latest model. So I think it’s just super easy now and anybody can do it, as opposed to experts that are in the know,” he said in an interview.

Rather than try to assess the image itself, the software looks at the file’s
“When we see that these markers are present, we have really high confidence of high accuracy to identify them as potentially AI generated receipts,” said Wieseneck. “I was the first person to test it out as the person that owns our internal instance of Ramp and
While the speed at which they produced this solution may be remarkable, he said it is part of the company culture. The team, especially small pods within it, will observe a problem and stop what they’re doing to focus on a specific need. They get a group together on a Slack channel, work through the problem, code it late at night and push it out in the morning.
Wieseneck conceded it is not a total solution but rather a first line of defense to deter the casual fraudster. He compared it to locking your door before going out. If the front door is unlocked, a person can just stroll in and steal everything, but will likely give up if it is locked. A professional criminal with tons of breaking and entering experience, however, is unlikely to be deterred by a lock alone, versus a lock plus an alarm system plus an actual security guard.
“But that doesn’t mean that you don’t lock your door and you don’t add pieces of defense to make it harder for people to either rob your house or, in this case, defraud your company,” he said.
This isn’t to say there’s no plans to bolster this solution further. After all, the feature is only days old. He said the company is already looking into things like pixel analysis and textual analysis of the document itself to further enhance its AI detection capabilities, though he stressed that they want to be very confident it works before pushing it out to customers.
“We’re focused on giving finance teams confidence that legitimate receipts won’t be falsely flagged. So we want to tread carefully. We have lots of ideas. We’re going to work through them and kind of solve them in the same process we’ve always done here at Ramp,” he said.
This is likely only the beginning of AI image generators being used to fake documentation. For instance, it has recently been found that bots are also very good at forging
AI fraud ascendant
This speaks to an overall trend of AI being used in financial crimes which was highlighted in a
The poll found that 61% of respondents say use of AI by cybercriminals is a leading catalyst for risk exposure, such as through the generation of deep fakes and, likely, AI-generated financial documents. While 57% think AI will help against financial crime, 49% think it will hinder (Kroll said they are likely both right).
“The rapid-fire adoption of AI tools can be a blessing and a curse when it comes to financial crime, providing new and more efficient ways to combat it while also creating new techniques to exploit the broadening attack surface — be it via AI-powered phishing attacks, deepfakes, or real-time mimicry of expected security configurations,” said the report.
Yet, many professionals do not feel their current programs are up to the task. The rise in AI-guided fraud is part of an overall projected 71% increase in financial crime risks in 2025. Meanwhile, only 23% rate their compliance programs as “very effective” with lack of technology and investment named as prime reasons. Many also lack confidence in the governance infrastructure overseeing financial crime, with just 29% describing it as “robust.”
They’re also not entirely convinced that more AI is the solution. The poll found that confidence in AI technology has dropped dramatically over the past two years: those who say AI tools have had a positive impact on financial crime compliance have gone from 39% in 2023 to only 20% today. Despite this, there remains heavy investment in AI. The poll found 25% already say AI is an established part of their financial crime compliance program, and 30% say they are in the early stages of adoption. Meanwhile, in the year ahead, 49% expect their organization will invest in AI solutions to tackle financial crime, and 47% say the same about their cybersecurity budgets.
To help combat AI-enabled financial crime, Kroll recommended companies form cross-functional teams that go beyond IT and cybersecurity and involve those in AML, compliance, legal, product and senior management. Further, Kroll said there has to be focused, hands-on training with new AI tools that are updated and repeated as the organization implements new AI capabilities and the regulatory and risk landscape changes. Finally, to combat AI-related fraud, Kroll recommended companies maintain a “back to the basics” approach. Focus on fundamental human intervention and confirmation procedures — regardless of how convincing or time-sensitive circumstances appear.

Accountants tackle tariff increases after ‘Liberation Day’

How to use opportunity zone tax credits in the ‘Heartland’

Ramp releases tool to detect fraudulent AI-generated receipts

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