New IRS regulations may help cemeteries and funeral homes
by ICFA General Counsel Robert M. Fells, Esq.
The Internal Revenue Service recently published regulations detailing procedures to be used by domestic manufacturers under the American Jobs Creation Act of 2004 to qualify for a special tax deduction. The act added section 199 to the Internal Revenue Code whereby a deduction from taxable income may be taken for "net revenue" earned from the sale of property produced in the United States.
The new deduction requires the taxpayer to be engaged in the production and either sale or lease of tangible personal property, although it does not matter when the property was produced as long as the property is sold by the taxpayer after 2004.
According to ICFA Special Tax Counsel Leslie J. Schneider, the new deduction "might seem on its face not to be applicable to the typical types of activities that are performed by cemeteries (or funeral homes), but it turns out that certain types of cemetery activities might qualify for this special deduction."
Schneider has written an article explaining the terms of the new IRS regulations that will appear in the August-September issue of ICFM.
Funeral Rule recommendations before fall?
FTC staff has indicated it will have recommendations on Funeral Rule revisions ready by late summer. Cynics might point out that since late 1999, the Federal Trade Commission staff has always claimed to be six months away from sending its recommendations to the commissioners for approval.
The FTC recently published its semiannual regulatory agenda wherein the Funeral Rule was identified as "likely to have some impact on small entities." This most recent agenda states, "Staff is evaluating the comments and anticipates forwarding a recommendation to the commission by late summer 2006." The comments referred to by staff were those submitted by the ICFA and many other interested parties in 1999 during the most recent rulemaking review of the rule.
A brief history of the proceedings was stated in the regulatory agenda: "The commission responded to requests to address emerging issues in the funeral industry by beginning a review of the rule in 1998 rather than in 1999 as originally planned under its 10-year schedule for reviewing all commission rules and guides. The commission published a notice soliciting public comment in May 1999. Commission staff conducted a public workshop conference on November 18, 1999, to discuss and explore openly issues raised in written comments."
Among the issues raised during the period of active review seven years ago were amending the Funeral Rule to cover all sellers of funeral goods or services, restricting or prohibiting the non-declinable professional service fee and repealing the rule.
Cemetery consumer council announces 2005 results
The Cemetery Consumer Service Council, the cemetery profession's volunteer consumer assistance group, has published the results of its complaint and inquiry survey for 2005. A total of 237 complaints and inquiries were received during the year and 192 were resolved. Fifteen complaints and inquiries were pending at the beginning of the year while another 21 remained at year's end. These figures are based on the responses provided by 21 of the 40 state CCSC committees and state agencies where no CCSC committee exists.
Among the complaints and inquiries received in 2005, 42 dealt with improper cemetery maintenance, 91 with questionable sales practices, six with Truth in Lending matters and other contractual issues, 38 with cemetery rules and regulations and 38 with a variety of other issues, including simple inquiries into cemetery practices. Not all agencies track the type of inquiries received, so a precise breakdown of activities is not always possible.
CCSC is now in its 27th year of operation and continues to improve its effectiveness in assisting consumers. An increasing number of calls originate as referrals from Better Business Bureaus and similar organizations. The CCSC also contacts members of Congress to advise them of the assistance and information the council can offer their constituents.
CCSC is a nonprofit organization created in 1979 and is funded by the International Cemetery and Funeral Association, the Cremation Association of North America, the Central States Cemetery Association, the Southern Cemetery and Funeral Association, the Western Cemetery Alliance, the Illinois Cemetery and Funeral Home Association and the Cemetery & Mortuary Association of California.
The sole purpose of the CCSC is to assist consumers, without charge, in resolving complaints or answering inquiries regarding cemetery services or policies. Participation in the complaint resolution process is voluntary for both the consumer and the cemetery. Members of the cemetery profession volunteer their time and experience to serve as CCSC representatives in their respective states.
The Federal Trade Commission, the U.S. Department of Veterans Affairs, various state consumer protection agencies and offices of attorneys general are periodically notified of CCSC activities and are among the major sources for consumer referrals.
CCSC is listed in the Consumer's Resource Handbook, a U.S. government publication circulated to public libraries and consumer assistance agencies across the country.