TAX CONTROVERSY 360

Weekly IRS Roundup November 4 – November 8, 2024

by Kevin Spencer, Evan Walters and Sama Kaseer | Nov 18, 2024 | IRS Guidance, Tax Reform

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of November 4, 2024 – November 8, 2024.

November 4, 2024: The IRS released Internal Revenue Bulletin 2024-45, which includes the following:

Treasury Decision 10008, which provides guidance on federal income tax withholding under § 3405 of the Internal Revenue Code (Code) for periodic payments and nonperiodic distributions from employer-deferred compensation plans, individual retirement plans, and commercial annuities that are not eligible rollover distributions. Effective January 1, 2026, these regulations also cover payments and distributions made to payees outside the United States.
Revenue Ruling 2024-24, which provides the November 2024 applicable federal rates.
Notice 2024-74, which provides guidance on safe harbors for sustainable aviation fuel (SAF) credits under Code §§ 40B and 6426(k), as established by the Inflation Reduction Act of 2022, and instructs taxpayers to use the updated October 2024 40BSAF-GREET model for calculating emissions reductions for SAF credits.
Notice 2024-76, which provides the 24-month average corporate bond segment rates for October 2024, yield curve and segment rates for single-employer plans, and 30-year Treasury securities interest rates.
Notice 2024-77, which provides guidance on the treatment of inadvertent benefit overpayments under Code §§ 414(aa) and 402(c)(12) and outlines how these overpayments can be corrected and treated as eligible rollover distributions.
Revenue Procedure 2024-40, which provides the annual inflation adjustments for tax year 2025, affecting several tax provisions. Key changes include increases in the standard deduction, marginal tax rates, and various tax credits and exclusions.

November 7, 2024: The IRS released its 2024 financial report, which presents the IRS’ current financial position and resolves a long-standing deficiency in its information system controls.

November 7, 2024: The IRS reminded employees they can contribute up to $3,300 to a healthcare flexible spending arrangement in 2025 and use tax-free dollars for medical expenses not covered by other health plans, such as co-pays, deductibles, dental and vision care, and over-the-counter items.

November 7, 2024: The IRS warned taxpayers about scammers who set up fake charities to exploit generosity during natural disasters and reminded them to verify the legitimacy of charities using the Tax Exempt Organization Search Tool before making donations.

November 8, 2024: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).

Weekly IRS Roundup October 28 – November 1, 2024

by Kevin Spencer, Evan Walters and Sama Kaseer | Nov 4, 2024 | IRS Guidance, Tax Reform

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of October 28, 2024 – November 1, 2024.

October 28, 2024: The IRS released Internal Revenue Bulletin 2024-44, which includes the following:

Treasury Decision 9994, which provides guidance on § 367(d) of the Internal Revenue Code (Code) regarding the transfer of intangibles by US persons to foreign corporations. Effective January 1, 2024, the regulations turn off the application of § 367(d) when foreign corporations repatriate the intangibles to a qualified domestic person when certain reporting requirements are satisfied.
Notice 2024-71, which provides a safe harbor under Code § 213(d), treating amounts paid for condoms as medical care expenses eligible for reimbursement under various health plans. These amounts can also be paid or reimbursed, but if reimbursed, they are not deductible.
Notice 2024-75, which expands the list of preventive care benefits that high deductible health plans can provide without a deductible or with a lower deductible, including benefits for over-the-counter oral contraceptives and condoms, regardless of whether they are purchased with a prescription. The guidance is effective for plan years that began on or after December 30, 2022.
Revenue Procedure 2024-33, which updates the guidelines and general requirements for developing, printing, and approving substitute tax forms as detailed in Revenue Procedure 2023-28 to ensure submitted forms can be accepted as substitutes for official IRS forms.
Announcement 2024-36, which revokes the determination for specified organizations under Code § 501(c)(3) and stipulates that contributions made to said organizations by individual donors are no longer deductible under Code § 170(b)(1)(A).

October 28, 2024: The IRS reminded taxpayers to stay alert against online threats like identity theft and fraud. As National Cybersecurity Awareness Month concludes, the agency also offered tips, such as using strong passwords, enabling multifactor authentication, and avoiding phishing scams, to protect one’s personal information.

October 28, 2024: The IRS released Notice 2024-78, which extends the temporary relief provided in Notice 2023-11 for foreign financial institutions required to report US taxpayer identification numbers for certain preexisting accounts. This relief applies to eligible institutions under a Model 1 intergovernmental agreement for the 2025, 2026, and 2027 calendar years.

October 28, 2024: The IRS reminded employers that hiring individuals from specific groups can help reduce their tax liability through the Work Opportunity Tax Credit. To claim this credit, employers must certify the eligibility of new hires by submitting IRS Form 8850 to their state workforce agency within 28 days of the employee starting work.

October 29, 2024: The IRS announced the appointment of its new associate chief counsel for the Passthroughs, Trusts, and Estates office, which will focus on partnerships, S corporations, trusts, and estates.

October 29, 2024: The IRS reminded businesses that they can qualify [...]

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Weekly IRS Roundup October 7 – October 11, 2024

by Kevin Spencer, Evan Walters and Sama Kaseer | Oct 24, 2024 | IRS Guidance, Tax Reform

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of October 7, 2024 – October 11, 2024.

October 7, 2024: The IRS released Internal Revenue Bulletin 2024-41, which includes the following:

Notice 2024-69, which provides the inflation adjustment factor and reference price for the renewable electricity production credit under 45 of the Internal Revenue Code (Code) for calendar year 2024. The inflation adjustment factor and reference price are used to determine the availability and amount of the credit for electricity produced from qualified energy resources in the United States or its possessions.
Revenue Procedure 2024-36, which updates the requirements for substitute IRS Forms W-2c and W-3c by detailing the specifications for red-ink and black-and-white forms as well as the electronic filing procedures. The new guidelines emphasize the importance of conforming to these specifications to avoid penalties and ensure proper processing by the IRS and Social Security Administration.

October 7, 2024: The IRS issued final regulations, which qualify certain syndicated conservation easement transactions as “listed transactions,” requiring their disclosure on IRS Form 8886, Reportable Transaction Disclosure Statement, and Form 8918, Material Advisor Disclosure Statement, by certain participants and material advisors. These regulations aim to prevent the use of inflated appraisals to claim unwarranted tax deductions and are effective as of October 8, 2024.

October 7, 2024: The IRS reminded taxpayers that the deadline to file their 2023 federal income tax returns is October 15, 2024. However, taxpayers in combat zones, disaster areas, and those affected by the terrorist attacks in Israel have extended deadlines to file and pay their taxes.

October 7, 2024: The IRS issued proposed regulations, which clarify that entities entirely owned by Indian tribal governments will not be recognized as separate entities for federal tax purposes or be subject to federal income tax. The regulations also provide that these entities may receive the value of certain energy credits under the Inflation Reduction Act of 2022.

October 10, 2024: The IRS announced it is processing approximately 400,000 Employee Retention Credit claims and is working on expediting these claims while ensuring compliance and preventing improper payments.

October 10, 2024: The IRS announced that the projected gross tax gap, which reflects the difference between true tax liability and taxes paid on time, for tax year 2022 has increased to $696 billion. The IRS attributes this increase to economic growth rather than changes in taxpayer behavior.

October 11, 2024: The IRS issued Revenue Procedure 2024-39, which grants certain entities an automatic six-month extension to file IRS Form 990-T, Exempt Organization Business Income Tax Return (and proxy tax under Section 6033(e) of the Code), for making elective payment elections under Code § 6417. This relief aims to assist entities unfamiliar with the filing process and those facing electronic filing limitations.

October 11, 2024: The IRS [...]

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Weekly IRS Roundup September 30 – October 4, 2024

by Kevin Spencer, Evan Walters and Sama Kaseer | Oct 15, 2024 | IRS Guidance, Tax Reform, Tax Refunds

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of September 30, 2024 – October 4, 2024.

September 30, 2024: The IRS released Internal Revenue Bulletin 2024-40, which includes the following:

Revenue Ruling 2024-20, which provides the terminal charge and Standard Industry Fare Level mileage rates for valuing noncommercial flights on employer-provided aircraft for the second half of 2024.
Treasury Decision 9991, which contains final regulations that provide guidance on the consistent basis requirement under 1014(f) of the Internal Revenue Code (Code), applicable to recipients of certain property from a decedent, and the reporting requirements under Code § 6035, applicable to executors and other persons required to file an estate tax return. The final regulations adopt the 2016 proposed regulations (with some modifications) and are designed to ensure accurate reporting and compliance.
Proposed regulations, which amend the definition of “coverage month” to include any month where the premium paid, including advance payments, is sufficient to maintain an individual’s coverage from being terminated for that month when computing their premium tax credit (PTC). The proposed regulations also modify certain rules for calculating an individual taxpayer’s health insurance PTC and clarify eligibility criteria for state basic health programs.
Proposed regulations, which update the qualified domestic trust rules under Code 2056A by removing outdated references to align with current IRS procedures and revising filing requirements and addresses. The proposed regulations primarily affect estates passing property to noncitizen spouses.

September 30, 2024: The IRS released draft IRS Form 7217, Partner’s Report of Property Distributed by a Partnership, which requires partners to report property distributions from partnerships beginning in tax year 2024. Distributions consisting solely of money or marketable securities treated as money are excluded.

September 30, 2024: The IRS released Notice 2024-70, which extends the replacement period under Code § 1033(e) for livestock sold or exchanged because of drought conditions in specified counties across 41 US states, allowing more time for eligible farmers and ranchers to replace livestock.

October 1, 2024: The IRS extended the deadline to file federal individual and business tax returns and make tax payments for certain individuals and businesses in Illinois that were affected by severe weather that began on July 13, 2024. The new deadline is February 3, 2025. The extended deadline is available to taxpayers in any area designated by the Federal Emergency Management Agency (FEMA), including individuals and households that reside or have a business in the following counties: Cook, Fulton, Henry, St. Clair, Washington, Will, and Winnebago.

October 1, 2024: The IRS announced it is seeking volunteers for the Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs to provide free tax services during the upcoming filing season. Interested individuals can sign up from October to January, with flexible hours and various roles [...]

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Weekly IRS Roundup September 23 – September 27, 2024

by Kevin Spencer, Evan Walters and Sama Kaseer | Oct 7, 2024 | IRS Guidance, Tax Reform

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of September 23, 2024 – September 27, 2024.

September 23, 2024: The IRS released Internal Revenue Bulletin 2024-39, which includes the following:

Announcement 2024-39, which revokes the determination for specified organizations under § 501(c)(3) of the Internal Revenue Code (Code) and stipulates that contributions made to said organizations by individual donors are no longer deductible under Code § 170(b)(1)(A).
Proposed regulations, which update and modify the 2017 proposed regulations, including the timing for making and revoking the proposed mark-to-market election and the Code § 954 currency elections. Taxpayers may rely on the regulations until they are finalized, but the changes to the 2017 proposed regulations take effect upon their publication in the Federal Register, which is expected on August 20, 2024.

September 23, 2024: The IRS announced the appointment of a new chief for its Independent Office of Appeals. They will be responsible for managing the resolution of tax disputes between taxpayers and the IRS without litigation.

September 24, 2024: The IRS released Revenue Procedure 2024-38, which provides guidance on the income requirements for qualified residential rental projects financed with exempt facility bonds under Code § Section 142(d) and for qualified low-income housing projects under Code § 42. The guidance will take effect on October 24, 2024.

September 26, 2024: The IRS introduced a supplemental claim process to assist payroll companies and third-party payers in resolving incorrect claims for the Employee Retention Credit. This process allows third-party payers to correct or withdraw claims for taxpayers who are ineligible for the credit.

September 26, 2024: The IRS released Revenue Ruling 2024-22, determining that the Bourse de Montréal (MX) is a qualified board or exchange under Code § 1256(g)(7)(C), provided it holds a valid Order of Registration from the Commodity Futures Trading Commission. This ruling is effective for MX contracts entered into on or after November 1, 2024.

September 27, 2024: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).