TEC initiatives.

• Author: Purcell, Thomas J., III
• Position: DC Currents

Since the last cut-off date for this column (June 15, 2002; see TTA, August 2002, p. 538), the Tax Executive Committee (TEC) met once (Aug. 5-6, 2002) and exercised its review function on several projects. TEC actions taken after Sept. 1, 2002 will be reported in a future column.

Administrative Issues

As reported in the May 2002 column, the Tax Executive Committee established the Scope of Services Task Force (chaired by Ron Katch) to monitor developments on proposed restrictions on members' ability to provide tax services to audit clients. The task force is coordinating responses to the recently enacted Sarbanes-Oxley Act with other AICPA divisions. (See News Notes, "Sarbanes-Oxley Act," TTA, October 2002, p. 621.) Future developments will be reported in this column and in the Tax Division Newsletter.

Technical Activities

Inversion transactions. On June 28, the TEC submitted comments to Congress, the IRS and Treasury on corporate inversion issues. The comments (prepared by the International Tax Technical Resource Panel (TRP), chaired by Andy Mattson), encouraged Congress to focus not just on the prevention of inversion transactions, but also on the current U.S. tax disadvantages facing U.S.-based multinationals, as well as on U.S. tax advantages available to foreign-based multinationals. The TRP expressed concern that narrow legislation focused on preventing abuses fails to consider the broader policy issues that give rise to such transactions.

Tax shelters. The TEC continues to provide appropriate commentary on tax shelters. On July 2, 2002, it submitted comments (prepared by the Tax Shelter Regulations Task Force, chaired by Debbie Pflieger) on temporary and proposed regulations under Secs. 6011, 6111 and 6112. The comments addressed Treasury's proposals to broaden and better align the rules and regulations on disclosure, registration and list-keeping in tax-avoidance transactions.

The TEC, the Tax Shelter Regulations Task Force and the AICPA anticipate that Congress will consider tax shelter legislation after the Labor Day recess. In anticipation, the Tax Division is disseminating tax-shelter information to members via the Tax Division Newsletter and through direct-mail notices sent to appointed members of the Tax Division. Further, additional technical and nontechnical comments are being prepared for submission to Congressional committees, members and staff.

Trust fund recovery penalties. On July 18, 2002, Pam Pecarich (TEC Chair)...