Tax Executive Committee initiatives.

• Author: Purcell, Thomas J., III

In 1999, the AICPA restructured to provide more cost-effective service to its constituents. As part of the restructuring, the Tax Executive Committee (TEC) continued its role of representing the membership in tax matters, but also expanded its responsibility as a liaison with outside organizations and now has standard-setting authority under the AICPA Code of Professional Conduct.

The TEC has spent significant time developing effective processes for implementing the restructuring changes. The restructure reduced the number of standing committees (other than the TEC) to three. The majority of the technical activities that committees previously provided is now the responsibility of newly created technical resource panels (TRPs) and task forces (TFs). The TRPs have broad areas of responsibility and their intention is to serve as overseers of a particular technical area. Because TRP membership is limited (averaging seven members), the responsibility for investigating and developing technical analyses of various aspects of the tax law will fall on the TFs. TF membership is not limited to TRP members, but is open to all AICPA members who might have an interest or expertise in a particular area of inquiry. (Members who wish to become involved in a task force should contact the Tax Division staff.)

The TEC oversees the work of the TRPs and TFs. Discussion and modification of the positions of either occurs before dissemination to appropriate public and governmental organizations. Once the TEC approves a position, it becomes the official position of the AICPA.

Important Issues Facing the Profession

Two of the most significant issues include the Code's penalty and interest provisions and the corporate tax shelter controversy.

The penalty and interest issue primarily involves proposals to increase the responsibility of taxpayers and their advisers in discerning the supportability of tax positions as a condition for avoiding understatement penalties. The Penalty and Interest Reform Task Force, the Relations with the IRS Committee and the TEC developed positions and wrote testimony on the issues other than the tax shelter provisions of the penalty and interest proposals, submitted to the Ways and Means Committee on Jan. 27, 2000. The TEC's primary position is that the Service should impose penalties to insure compliance, not raise revenue, and relate interest costs directly to the use of money and not disguise them as penalties.

The Corporate Tax...