TAX BLOGOSPHERE BUDDIES - DAN MEYER

 

Today we meet Dan Meyer, a Professor of Accounting at Austin Peay State University in Clarksville, TN, and author of the blog TICK MARKS, which I love to say has nothing to do with lyme disease (you see lyme disease is transmitted by ticks, who leave a distinctive mark when they bite you).  In this case “tick marks” refer to the mark an accountant makes when footing and cross-footing columns of numbers.

While primarily an accounting blog, Dan often discusses tax issues.

Dan used to list “The Twelve Blogs of Christmas” each year, and TWTP made the list in the tax category back in 2007.

How did you become interested/involved in preparing tax returns?

As I was settling on an accounting major in my sophomore year of college; I took an H&R Block self-study tax training class.

How were you educated/trained in preparing tax returns?

In addition to the class above; I took a tax course as an undergraduate at “Ole Miss” and several tax theory classes during my doctorate at the University of Missouri.  In addition, I got “on-the-job” training in tax preparation while working for CPA firms in Memphis, TN and Corinth, MS

When and why did you decide to write a blog on tax issues?

In 2005, there were not a lot of accounting and tax blogs in existence and I believed that starting a blog would help in my academic career at Austin Peay State University.

How has blogging helped your business?

I do not have a business, but it has helped me as a college teacher by helping me keep up on developments in the profession (and at closer to “real time” than I would get simply by taking CPE courses as a CPA), by enabling me to get a journal publication (New Accountant, 2007, Issue 723?) and I have assigned students to do a simulated blog in one of my undergraduate courses.

What do you consider the “best tax advice” you can give anyone?

Take legitimate deductions and credits to be sure, but after that, PAY your taxes.

Do you think the regulation of tax return preparers is a good thing?

From a purely ideological point of view, no; the present American economy is badly overregulated and that is an important contributor to the present high unemployment rate.  However, the tax return preparer legislation has a saving grace—accounting students with marginal GPAs can and should take the RTRP exam and have a saleable skill along with their diploma.

Do you think CPAs and attorneys should be exempt from testing and required CPEs in taxation?

In general, yes since tax is tested on the CPA and bar exam. I do agree, however, that if subsequent research by the IRS shows that CPAs and attorneys have an error rate comparable to non-EAs/CPAs/attorneys, that this exemption should be pulled (note: EAs should have an unconditional exemption).  An additional tweak that I could accept (though not support for selfish reasons) would be to pull this exemption if the CPA/attorney had prepared less than 20 returns in the past five years or if the CPA/attorney had received ethical or criminal sanction at the state or federal level in the last five years.

Do you think experienced tax preparers should be exempt from the initial RTRP competency test under “grandfathering”?

Mixed answer here since I can see good arguments for both sides—thus somewhat similar to the immigration debate in Washington.  At most, I could support something like a refund of competency test fee if the experienced preparer passed on the first try or a one-year deferral on the due date for the competency exam for preparers with over 10 years experience AND no ethical or criminal sanctions during the last 10 years.

How would you reform/rewrite the Tax Code?

Since I am in my mid-50s, I doubt that I could live long enough (even if I had the interest to do so) to read the code, regulations and court cases needed to fully understand what is in the present U. S. Internal Code of 1986, amended.  Having said that, a few superficial adjustments:

[1] Raise the capital gains and dividend rate to the lower of actual marginal rate or 25% except for sales of principal residence,

[2] eliminate the 85% provision on taxation of income for Social Security recipients and raise the floor to 50K MFJ/ 35K single/ 20K MFS,

[3] allow the first $1000 of charitable contributions and medical insurance to be deducted toward AGI,

[4] eliminate Subchapter C taxation of corporations (making virtually all business income pass-through) UNLESS they directly or constructively have taxable income in excess of $100,000,000; then a single tax rate of 25%,

[5] eliminate the estate tax on estates with net worth of less than $5 million;

[6] eliminate or drastically rework the credit for the elderly—at present, it is more hassle than it is worth.  In my blog last year, I have separately proposed several changes to extend the projected life of Social Security.

What is your favorite Broadway musical – and why?

I have never seen a musical on Broadway—I did see an off-Broadway presentation of “1776” in the Elliott Hall of Music at Purdue University in West Lafayette, IN as an adolescent and was quite impressed.

While Dan and I disagree on the basic concept of exempting CPAs from taking the RTRP exam, if we are indeed stuck with the blanket exemption I do like his suggestion of removing the exemption of CPAs who have prepared less than 20 returns in the past 5 years.  Although I would make it at least 10 Form 1040s per year in the past 5 years.

If he had to see only one Broadway musical he chose a good one.

TTFN