Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of September 9 – 13, 2019.
September 9, 2019: The IRS released a revision to its Internal Revenue Manual that clarifies procedures to assess late filing penalties involving two or more late Forms W-2 received by the Social Security Administration-Combined Annual Wage Reporting.
September 9, 2019: The IRS issued a news release announcing that the third quarter deadline for estimated tax payments is September 16, 2019. The release details who needs to pay estimated tax, how the estimated tax works, and how and when to pay. The IRS also highlighted that the Tax Withholding Estimator is now more mobile-friendly and replaces the Withholding Calculator on IRS.gov.
September 10, 2019: The IRS released proposed regulations that provide guidance on the items of income and deduction that are included in the calculation of built-in gains and losses under section 382, and reflects numerous changes made to the Code by the enactment of recent tax legislation. The proposed regulations would adopt as mandatory the net unrealized built-in gain (NUBIG) and net unrealized built-in loss (NUBIL) harbor computation under Section 1374, and provided in Notice 2003-65, with modifications, such as clarification on amounts included in the NUBIG/NUBIL computation and items that could be realized built-in gain and realized built-in loss during the recognition period. The proposed regulations do not incorporate the Section 338 approach. The proposed regulations would not allow cancellation of indebtedness (COD) income to be included in calculating NUBIG/NUBIL, but propose to limit the extent to which excluded COD income is treated as realized built-in gain. Notice 87-79, Notice 90-27, Notice 2003-65, and Notice 2018-30 are withdrawn and incorporated, as appropriate, into the proposed regulations.
September 11, 2019: The IRS issued a news release announcing that Darren Guillot has been selected as the Deputy Commissioner for Collection and Operations Support in the Small Business/Self-Employed Division (SB/SE) and De Lon Harris has been selected as the Deputy Commissioner for Examination. Guillot will direct and oversee programs impacting taxpayers who file personal, corporate, flow-through, employment, excise and estate and gift returns. Harris will provide executive oversight of SB/SE examination programs designed for taxpayers who file personal, corporate, flow-through, employment, excise and estate and gift returns.
September 12, 2019: The IRS issued a news release announcing the expansion of the Compliance Assurance Process for 2020. New corporate applicants who meet eligibility requirements can apply for the Compliance Assurance Process. The application period runs September 16 to October 31, 2019, and the IRS will inform applicants if they are accepted into the program around January 31, 2020.
September 13, 2019: The IRS submitted to the Office of the Federal Register final regulations providing guidance on the additional first year depreciation deduction under section 168(k). The IRS rejected calls from the retail, restaurant and construction industries to fix the “retail glitch” administratively, noting that Congress must address the clerical error in the Tax Cuts and Jobs Act that prevents investments in qualified improvement property (QIP) from qualifying for bonus depreciation.
September 13, 2019: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).
Special thanks to Robbie Alipour in our Chicago office for this week’s roundup.