Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of October 21 – 25, 2019.
October 21, 2019: The IRS issued a news release in which it announced the launch of its second annual International Charity Fraud Awareness Week. The IRS joined an international coalition to raise awareness and share practices to help charities and other not-for-profit organizations avoid fraud and stop financial crime. The campaign features an online hub where counter-fraud experts can share webinars, help sheets and case studies.
October 22, 2019: The IRS provided procedures to Chief Counsel attorneys for working and coordinating cases with issues involving virtual currency, including digital assets, digital currency, crypto-assets, and cryptocurrency. Issues that involve virtual currency that are not addressed by Notice 2014-21 or other public guidance, and that involve novel issues or issues likely to attract national attention are required to be coordinated with the National Office.
October 23, 2019: The IRS released a fact sheet in which it explained that certain tax treatments and employment tax rules can apply to family members working in the family business. The fact sheet stated that if spouses carry on a business together and share in its profits and losses, they may be partners whether or not they have a formal partnership agreement. It further explained how spouses can make a qualified joint venture election if they wish to avoid partnership status.
October 24, 2019: The IRS released two issue snapshots on self-dealing of Private Foundations involving the sale or exchange of property and on self-dealing of Private Foundations involving the lending of money or another extension of credit.
October 25, 2019: The IRS issued final regulations providing guidance on new information reporting obligations under section 6050Y related to reportable policy sales of life insurance contracts and payments of reportable death benefits. No reporting is required under section 6050Y for reportable policy sales made and reportable death benefits paid after December 31, 2017, and before January 1, 2019. The final regulations also provide guidance on the amount of death benefits excluded from gross income under section 101 following a reportable policy sale. The final regulations affect parties involved in certain life insurance contract transactions, including reportable policy sales, transfers of life insurance contracts to foreign persons, and payments of reportable death benefits. The final regulations are scheduled to be published in the Federal Register on October 31, 2019.
October 25, 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 and Jenni Saperstein in our Chicago office for this week’s roundup.