AICPA News is a collection of recent news briefs from the American Institute of CPAs.
AICPA Pushes Back on Treasury, IRS’ Overreaching Final Regulations
The American Institute of CPAs (AICPA), submitted a letter to the Department of the Treasury and Internal Revenue Service (IRS), recommending the immediate suspension and removal of final regulations that identify certain partnership related-party basis adjustment transactions as transactions of interest (TOI), a type of reportable transaction.
In its latest comment letter, the AICPA urges immediate suspension and removal of the final regulations due to the impractical provisions and administrative burdens it imposes.
The final regulations cover routine, non-abusive transactions, provide an unreasonably low threshold, and impose an unreasonably short 180-day deadline for taxpayers to file Form 8886, Reportable Transaction Disclosure Statement, for transactions related to previously filed tax returns due to the six-year lookback window. Additionally, advisors have only 90 additional days beyond the standard reporting deadline to file Forms 8918, Material Advisor Disclosure Statement.
Proposal Supporting Additional Path to CPA Licensure Open for Comment
The American Institute of CPAs (AICPA) and the National Association of State Boards of Accountancy (NASBA) are actively seeking comment through May 3, 2025 on proposed changes to the profession’s model law that would enable an additional path to CPA licensure.
The Uniform Accountancy Act (UAA) changes would:
- Enable states to adopt a third licensure pathway that requires earning a baccalaureate degree with an accounting concentration, completing two years of professional experience as defined by Board rule, and passing the Uniform CPA Examination (CPA Exam)
- Shift to an “individual-based” mobility model, which allows CPAs to practice in other states with just one license
- Add safe harbor language to ensure CPAs who meet existing licensure requirements preserve practice privileges
Comments on the proposed changes are due May 3, 2025, and can be submitted through this form. All comments will be published following the 60-day exposure period.
The UAA provides state legislatures and boards of accountancy with a national model that can be adopted in full or in part to meet the licensure needs of each jurisdiction.
The proposal would maintain the existing two pathways to CPA licensure:
- Earning a post baccalaureate degree with an accounting concentration, completing one year of professional experience as defined by Board rule, and passing the CPA Exam
- Earning a baccalaureate degree with an accounting concentration, plus an additional 30 semester credit hours, completing one year of professional experience as defined by Board rule, and passing the CPA Exam
Experience in all three pathways would be defined by state board rule and represent skills needed to serve the public at initial licensure.
Business Executives’ Outlook on U.S. Economy Fades Amid Tariff and Inflation Worries, AICPA & CIMA Survey Finds
A post-election boost in business executives’ optimism about the U.S. economy has moderated, declining from a more than three-year high of 67% last quarter to 47% this quarter, the AICPA & CIMA Economic Outlook Survey found. The shift reflects growing concerns about inflation and tariffs, according to the survey, which polls chief executive officers, chief financial officers, controllers, and other certified public accountants in U.S. companies who hold executive and senior management accounting roles.
The survey was conducted before the Trump Administration imposed tariffs this week on Canada, Mexico, and China, but respondents were asked their general views about unspecified tariffs if they were put in place. Fifty-nine percent indicated that tariffs would have a negative effect on their businesses, while 85% said uncertainty surrounding the subject had influenced their business planning to some degree—nearly one in five (18%) described that impact as significant.
Inflation remained the top concern for business executives, followed by issues related to staffing—employee and benefit costs (No. 2), availability of skilled personnel (No. 3), and staff turnover (No. 10). Domestic political leadership, which was absent from last quarter’s top 10 concerns, reemerged at No. 6.
Other key findings of the survey:
- Business executives who said they were optimistic about their own organization’s outlook over the next 12 months fell from 53% to 50%, quarter over quarter.
- Revenue and profit expectations for the next 12 months both eased from last quarter’s big increases. Revenue growth is now expected to be 3%, down from a 3.3% projection last quarter. Profit projections are now 2%, down from 2.2% last quarter.
- Survey takers who expect their businesses to expand over the next 12 months remained unchanged at 57%.
- Some 39 percent of business executives said they had too few employees., a one percent increase from last quarter. One-in-five said they were ready to hire immediately, unchanged from last quarter.
Creps Named Next Chair of AICPA Auditing Standards Board
A KPMG audit partner has been named the new chair of the Auditing Standards Board (ASB), a key committee of the American Institute of CPAs.
Catherine “Halie” Creps, a partner in KPMG’s Department of Professional Practice, will assume her duties at the end of May. She succeeds Sara Lord of RSM US LLP, who has served as chair of the board for the last three years and had previously served as a member.
Creps has more than two decades of experience, both at KPMG – where she focuses on emerging audit and accounting issues – and formerly as a practice fellow at the Financial Accounting Standards Board (FASB). She has served as a member of the board for the last three years, leading its critical projects related to attestation engagements.
In total, seven new members will join the board at the end of May. They are:
- Michael Brand, CPA, CGMA, assurance member, BMSS LLC
- Heather A. Funsch, CPA, principal and director of professional standards, Rehmann
- Nora Kilaghbian, vice president, Capital Group (retired)
- Carole McNees, CPA, partner, Plante Moran
- Christine Quintana, CPA, partner, Ernst & Young LLP
- G. Alan Skinner, CPA, partner and assurance service line leader, Carr, Riggs & Ingram LLC
- Daniel Trujillo, CPA, CGMA, managing partner, TKM, LLC
AICPA Highlights 2025 Tax Priorities in Letter to Capitol Hill
In a letter to Congressional leadership in the Senate Finance and House Ways & Means Committees, the American Institute of CPAs (AICPA) highlighted a number of legislative proposals directly related to possible changes to the tax rules. The 2025 tax priorities outlined in the letter included several proposals from the AICPA’s 2025 Compendium of Tax Legislative Proposals – Simplification and Technical Proposals, which included 69 suggested simplification of and technical changes to provisions in the Internal Revenue Code.
These priorities include:
- Tthe Freedom to Invest in Tomorrow’s Workforce Act (H.R. 1151 / S. 756), allowing 529 plan funds to be used for post-secondary credential expenses.
- Provide permanent and consistent tax relief to individuals and businesses affected by natural disasters, such as the Filing Relief for Natural Disasters Act (H.R. 517 / S. 132).
- Retain the qualified business income (QBI) deduction and expand the QBI deduction limit phase-in range.
- Extend the section 174 research and experimental costs expensing and other related expired/expiring provisions of the Tax Cuts and Jobs Act of 2017 (TCJA).
- Preserve the pre-TCJA full deduction for all state and local taxes paid or accrued in carrying on a trade or business, whether paid at the entity level or by a partner/owner.
- Continue the TCJA higher exemption amounts for the individual Alternative Minimum Tax, which simplifies filing for many taxpayers.
- Preserve the current availability of the cash method of accounting for tax purposes.
- Increase the Form 1099-K reporting threshold from $600 to $10,000 or above for third-party payment platforms.
- Include the Paid Family and Medical Leave Tax Credit Extension and Enhancement Act (S. 400), which would provide certainty to businesses by making a temporary paid family leave tax credit permanent.
While the tax priorities letter focuses on a select number of provisions that the AICPA is immediately focused on due to their possible consideration as part of the upcoming 2025 tax legislative process, the 2025 Tax Legislative Compendium is an exhaustive list of 69 tax proposals that the AICPA’s tax committees and panels have developed and updates each Congress for consideration.
The AICPA’s 2025 Tax Legislative Compendium contains 69 proposals, including 14 disaster tax relief recommendations. The overall goal for these proposals is to improve tax administration, make the tax code fairer, and effectively promote important policy objectives.
AICPA Responds to Proposed Regulations under SECURE 2.0
The American Institute of CPAs (AICPA), in a letter submitted to the Department of the Treasury and Internal Revenue Service (IRS), responded to proposed regulations related to automatic enrollment requirements authorized under SECURE 2.0.
Based on the recent proposed regulations, the AICPA recommends the following:
Investment Requirements for Trustee Directed Plans – issue final regulations clarifying that the investment requirements set forth under Prop. Reg. § 1.414A-1(c)(4) are not applicable to plans that do not adopt participant direction of investment.
Determining Employee Count for Small Businesses – issue final regulations stating that only employees of the plan sponsor are included in the count for purposes of determining status as a small business under section 414A.
Definition of Predecessor Employer – issue final regulations that define predecessor employer by reference to Treas. Reg. § 1.415(f)-1(c)(2) for purposes of section 414A(c)(4)(A).
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