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Weekly IRS Roundup August 26 – August 30, 2024

by , and | Sep 6, 2024 | , ,

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of August 26, 2024 – August 30, 2024.

August 26, 2024: The IRS released Internal Revenue Bulletin 2024-35, which includes the following:

  • Revenue Ruling 2024-16, which provides the average annual effective interest rates for new loans under the Farm Credit System and lists the states within each Farm Credit System Bank Territory. These rates are used to compute the special use value of farmland for estate tax purposes under § 2032A of the Internal Revenue Code (Code).
  • Announcement 2024-32, which revokes the Code § 501(c)(3) determination for specified organizations and stipulates that contributions made to said organizations by individual donors are no longer deductible under Code § 170(b)(1)(A).
  • Proposed regulations that address issues under the dual consolidated loss rules, including the treatment of certain disregarded payments that result in losses for foreign tax purposes. These regulations clarify the interaction of dual consolidated loss rules with intercompany transactions under Code § 1503(d) and introduce rules for foreign hybrid entities.

August 26, 2024: The IRS identified new warning signs of incorrect Employee Retention Credit claims and urged businesses to review their filings to ensure eligibility and avoid mistakes. Common issues include unsupported claims of business suspension, wages paid to family members, and wages reported as payroll costs to qualify for the loan forgiveness.

August 27, 2024: The IRS concluded the “Protect Your Clients; Protect Yourself” summer campaign, which encouraged tax professionals to implement robust security measures to defend against identity theft and emerging data security threats. The campaign highlighted the critical need to protect sensitive information from cybercriminal exploitation.

August 27, 2024: The IRS reminded truckers that the deadline to file IRS Form 22901, Heavy Highway Vehicle Use Tax Return, and pay the heavy highway vehicle use tax for 2024 is September 3, 2024.

August 27, 2024: The IRS encouraged taxpayers to conduct a tax checkup at the end of the summer to adjust their withholding or payments and prevent unexpected tax bills next year. This initiative aims to help taxpayers align their tax payments with what they owe, especially those with gig economy jobs or other income not subject to withholding.

August 28, 2024: The IRS notified employers that they can use educational assistance programs to help employees repay their student loans through December 31, 2025.

August 28, 2024: The IRS extended the deadline to file federal individual and business tax returns and make tax payments for certain individuals and businesses in the US Virgin Islands that were affected by Tropical Storm Ernesto. The new deadline is February 3, 2025. The extended deadline is available to taxpayers in any area designated by the Federal Emergency Management Agency, including individuals and households that reside or have a business in any of the [...]

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Weekly IRS Roundup August 19 – August 23, 2024

by , and | Sep 3, 2024 | , ,

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of August 19, 2024 – August 23, 2024.

August 19, 2024: The IRS released Internal Revenue Bulletin 2024-34, which includes the following:

  • Treasury Decision 10005, which provides the criteria for single-employer defined benefit plan sponsors to obtain approval to use plan-specific mortality tables when calculating present value for minimum funding. Effective July 31, 2024, these changes will apply to plan years beginning on or after January 1, 2025.
  • Notice 2024-61, which provides the inflation adjustment factor and phase-out amount for the enhanced oil recovery credit under § 38 of the Internal Revenue Code (Code) for calendar years 1991 through 2024.
  • Announcement 2024-31, which revokes the Code § 501(c)(3) determination for specified organizations and stipulates that contributions made to said organizations by individual donors are no longer deductible under Code § 170(b)(1)(A).

August 19, 2024: The IRS reminded taxpayers that summer day camp expenses may qualify for the Child and Dependent Care tax credit, which can help offset costs for working parents with children under 13. The credit may cover up to 35% of qualifying expenses, with a maximum eligible expense of $3,000 for one child and $6,000 for two or more.

August 19, 2024: The IRS released Notice 2024-63, which allows employers to match contributions to Code § 401(k) plans and similar retirement plans based on employees’ student loan payments. This guidance, effective for plan years beginning after December 31, 2023, includes eligibility criteria, employee certification requirements, and special nondiscrimination testing relief.

August 19, 2024: The IRS reminded taxpayers who requested an extension to file their federal taxes that free filing options, such as IRS Free File and MilTax (for eligible military members), are still available for filing electronically and claiming tax credits.

August 20, 2024: The IRS advised taxpayers who opted for paid tax preparers to help file their tax returns to verify the preparer’s credentials, check their history with the Better Business Bureau, and ensure they offer IRS e-file services.

August 20, 2024: The IRS highlighted the “Security Six,” a set of essential steps tax professionals can take to protect their offices, computers, and client data from cyber threats. These steps include using anti-virus software, firewalls, multifactor authentication, backup software or services, encrypted drives, and virtual private networks.

August 21, 2024: The IRS reminded school teachers that they can deduct up to $300 of unreimbursed classroom expenses for the 2024 tax year. This deduction applies to a variety of classroom items, including supplies, books, and equipment, and is available even if teachers take the standard deduction.

August 21, 2024: The IRS released Revenue Ruling 2024-18, which announces that interest rates for tax overpayments and underpayments under Code § 6621 will remain unchanged for the fourth [...]

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Weekly IRS Roundup June 10 – June 14, 2024

by , and | Jun 25, 2024 | , ,

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of June 10, 2024 – June 14, 2024.

June 10, 2024: The IRS released Internal Revenue Bulletin 2024-24, which includes the following:

  • Revenue Ruling 2024-11, which provides the interest rates under 6621 of the Internal Revenue Code (Code) for tax underpayments and overpayments for the calendar quarter beginning July 1, 2024. The underpayment and overpayment interest rates will remain the same for the third calendar quarter of 2024.
  • Notice 2024-36, which provides the timeline for the second 2024 allocation round of the Qualifying Advanced Energy Project Credit program under Code 48C(e) and supersedes Appendices A, B and C of Notice 2023-44.
  • Notice 2024-39, which provides the inflation adjustment factor for the carbon oxide sequestration credit under Code § 45Q for taxpayers who make an election under § 45Q(b)(3) for calendar year 2024.
  • Notice 2024-40, which updates the corporate bond weighted average interest rate for plan years beginning May 2024, the 24-month average segment rates, the funding transitional segment rates applicable for May 2024 and the minimum present value transitional rates for April 2024.
  • Notice 2024-41, which provides a new elective safe harbor for taxpayers seeking to qualify their energy projects for the 10% Domestic Content Bonus Credit. The notice also modifies Notice 2023-38 by expanding the list of Applicable Projects to include hydropower and pumped hydropower storage facilities, among other changes.
  • Proposed Regulations, which provide guidance on information reporting requirements for transactions with foreign trusts and the receipt of large foreign gifts under Code § 643(i), 679, 6039F, 6048 and 6677 (the foreign trust and gift provisions). The proposed regulations would also provide that certain loans from a foreign trust and the use of trust property are reportable events.
  • Announcement 2024-22 and Announcement 2024-23, which revoke the Code § 501(c)(3) determination for specified organizations and stipulate that contributions made to said organizations by individual donors are no longer deductible under Code § 170(b)(1)(A).
  • Announcement 2024-24, which notifies taxpayers of the applicable Reference Standard 90.1 required under Code § 179D(c)(2) as part of the definition of energy efficient commercial building property, effective May 17, 2024.

June 10, 2024: The IRS highlighted options for taxpayers who missed the April filing deadline to file their 2023 federal income tax returns and reminded those taxpayers to pay the amounts owed as soon as possible to limit penalties and interest charges.

June 10, 2024: The IRS reminded taxpayers that the second quarter estimated tax payment deadline is June 17, 2024.

June 10, 2024: The IRS advised that most individual and business taxpayers can use the Online Payment Agreement service to set up a payment plan, including an installment agreement, to pay off an [...]

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Employers Be Forewarned and Forearmed: Recent IRS Announcements Require Action on ERTC Claims

by and | Nov 8, 2023 |

Promoters and tax advisors have extensively marketed the Employee Retention Tax Credit (ERTC) as a way for employers to reclaim Federal Insurance Contributions Act payroll taxes paid during the first two years of COVID-19. The rules governing ERTC claims are complex and nuanced, however, resulting in increased scrutiny by the Internal Revenue Service (IRS). Asserting that many employers have improperly claimed these heavily marketed ERTC refunds, the IRS released two announcements, one on September 14, 2023, and the other on October 19, 2023, that address ERTC claims. In conjunction with these announcements, the IRS has already named fraudulent ERTC claims as number one on its “Dirty Dozen” list for 2023.

Specifically, the IRS will now target erroneous ERTC claims with penalties and interest. If a case is deemed fraudulent, the IRS will investigate and may impose civil and criminal penalties. The IRS has also suspended ERTC refund claims and provided a new withdrawal process for potentially fraudulent claims.



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Weekly IRS Roundup October 23 – October 27, 2023

by | Oct 30, 2023 | ,

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of October 23, 2023 – October 27, 2023.

October 23, 2023: The IRS is recruiting volunteers for the Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs. VITA and TCE participants prepare millions of tax returns each year for low- to moderate-income taxpayers at no cost. No experience is necessary to volunteer. Volunteers will have the option to participate both in-person and via virtual sites. To learn more about becoming a VITA or TCE volunteer, visit IRS Tax Volunteers.

October 23, 2023: The IRS warned taxpayers to be wary of criminals falsely posing as legitimate charities to solicit donations. Donors can use the Tax-Exempt Organization Search tool on IRS.gov to find or verify legitimate charities.

October 23, 2023: The IRS released Internal Revenue Bulletin 2023-43, which includes the following:

  • Final regulations and proposed regulations that reduce the user fee to apply for or renew a preparer tax identification number (PTIN) from $21 to $11 (plus an amount payable directly to a third-party contractor).
  • Revenue Procedure 2023-28 provides guidelines for the development, printing and approval of 2023 substitute tax forms.
  • Proposed regulations that would provide guidance on §§ 30D(g) and 25E(f), including guidance involving:
    • Elections to transfer new and previously owned clean vehicle credits
    • Dealer qualifications for becoming an eligible entity that can receive advance payments of new and previously owned clean vehicle credits
    • Credit recapture.
  • Revenue Procedure 2023-33 sets forth the procedures for transferring new and previously owned clean vehicle credits from a taxpayer to an eligible entity under §§ 30D(g) and 25E(f), including procedures for dealer registration with the IRS, procedures for the suspension and revocation of said registration and the establishment of an advance payments program to registered dealers. This revenue procedure also provides guidance on the submission of seller reports and reports by qualified manufacturers.

October 24, 2023: The IRS reminded tax return preparers to renew their PTINs ahead of the upcoming tax filing season. Information to begin the online renewal process can be accessed here. Failure to have and to use a valid PTIN may result in penalties.

October 25, 2023: The IRS published Tax Tip 2023-118, which notes that tax professionals can use Tax Pro Accounts to send powers of attorney and tax information authorization requests directly to a client’s individual IRS Online Account.

October 25, 2023: The deadline to comment on proposed regulations involving information reporting, backup withholding and the determination of amount realized and basis for digital assets sales was extended from October 30, 2023, to November 13, 2023.

October 26, 2023: The IRS encouraged employers to electronically [...]

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Weekly IRS Roundup October 16 – October 20, 2023

by | Oct 23, 2023 | , ,

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of October 16, 2023 – October 20, 2023.

October 16, 2023: The IRS published Revenue Ruling 2023-20, which provides the November 2023 applicable federal rates.

October 16, 2023: The IRS announced that the deadline for 2022 income tax returns and payments for most California taxpayers has been postponed again until November 16, 2023. Because of natural disasters last winter, spring due dates were previously postponed to October 16, 2023. The list of localities eligible for the extension are available here.

October 16, 2023: Tax professionals can now access 18 self-study seminars that satisfy continuing education requirements for the federal tax law and ethics categories. The seminars can be accessed at Nationwide Tax Forums Online for a fee of $29 per seminar.

October 16, 2023: The IRS announced that it recently awarded $51 million in Tax Counseling for the Elderly and Volunteer Income Tax Assistance grants to organizations that provide free federal tax return preparation services.

October 16, 2023: The IRS released Internal Revenue Bulletin 2023-42, which includes the following:

  • Notice 2023-65 provides guidance on the energy efficient home credit under Internal Revenue Code (Code) § 45L. It addresses who is eligible for the credit, how to determine the applicable amount of the credit, energy saving requirements, certification requirements and substantiation requirements.
  • Notice 2023-67 gives farmers and ranchers who were impacted by drought an extra year to replace livestock from forced sales and defer gains under Code § 1033(e).
  • Notice 2023-69 provides that any cash donations employers make to charitable organizations that provide relief to victims of the wildfires in Hawaii in exchange for sick, vacation, or personal leave that their employees forgo will not be treated as compensation. The notice also provides that these employees will not be treated as receiving the value of the leave as income and cannot claim a deduction for the leave that they donated to their employer. Employers may deduct these cash payments as a business expense or a charitable contribution deduction if the employer otherwise meets the respective requirements of the applicable sections of the Code.
  • Revenue Procedure 2023-35 provides that the IRS will not treat a redemption of a share in any money market fund as part of a wash sale under Code 1091.
  • Proposed regulations that provide guidance on how manufacturers, producers and importers of designated drugs will report excise tax liability under § 5000D. The proposed regulations also would except such excise tax from semimonthly deposit requirements.

October 18, 2023: The IRS released Notice 2023-70, which provides the adjusted applicable dollar amount to be multiplied by the average number of covered lives for purposes of calculating the fee imposed by §§ 4375 and [...]

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Weekly IRS Roundup August 21 – September 1, 2023

by | Sep 5, 2023 | , ,

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for August 21, 2023 – September 1, 2023.[1]

August 21, 2023: The IRS released Tax Tip 2023-102, warning tax professionals to be prepared for a variety of schemes aimed at stealing sensitive information, including phishing and attacks on cloud-based applications.

August 23, 2023: The IRS published Revenue Procedure 2023-29, providing the applicable percentage table used to calculate the premium tax credit under Section 36B.

August 24, 2023: The IRS reminded employers and employees that employers who have educational assistance programs can use those programs to help pay student loan obligations for their employees.

August 24, 2023: The IRS released Tax Tip 2023-103, outlining the Heavy Highway Vehicle Use Tax and reminding truckers that the tax payment due date is the last day of the month following the month the vehicle was first used on public highways. Truckers must also file Form 2290, Heavy Highway Vehicle Use Tax Return, by such date.

August 25, 2023: The IRS published Revenue Ruling 2023-17, which provides guidance on the overpayment and underpayment rate of tax under Section 6621. The ruling includes a table of interest rates spanning from 1975 through the present.

August 25, 2023: The IRS published Notice 2023-62, which provides guidance on particular issues involving catch-up contributions to retirement plans that are eligible to be designated as Roth contributions.

August 25, 2023: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).

August 28, 2023: The IRS released Tax Tip 2023-104, explaining that eligible teachers and administrators can claim a tax deduction for part of the cost of technology, supplies and training to the extent those expenses are not reimbursed.

August 29, 2023: The IRS issued proposed regulations that would require brokers to report sales and exchanges of digital assets by customers. The proposed regulations contemplate the creation of new Form 1099-DA.

August 29, 2023: The IRS released Tax Tip 2023-105, listing miscellaneous resources for military spouses who run businesses or do gig work.

August 30, 2023: The IRS issued proposed regulations, frequently asked questions and Publication 5855, which all relate to the increased tax credit or deduction amounts for clean energy facilities and projects if taxpayers satisfy certain prevailing wage and registered apprenticeship requirements.

August 30, 2023: The IRS announced that starting January 1, 2024, Form 8300, Report of Cash Payments Over $10,000, must be filed electronically. (See also FS-2023-19 (August 19, 2023).)

August 30, 2023: The IRS announced tax relief for individuals and businesses in parts of Florida affected by Hurricane Idalia. Currently, [...]

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Weekly IRS Roundup May 1 – May 5, 2023

by | May 8, 2023 | ,

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of May 1, 2023 – May 5, 2023.

May 1, 2023: The IRS released Internal Revenue Bulletin 2023-18, which highlights the following:

  • Announcement 2023-13: The Office of Professional Responsibility announced recent disciplinary sanctions involving lawyers, certified public accountants, enrolled agents, enrolled actuaries, enrolled retirement plan agents and appraisers.
  • Revenue Procedure 2023-15: This revenue procedure provides a safe harbor method of accounting that taxpayers may use to determine whether expenses to repair, maintain, replace or improve natural gas transmission and distribution property must be capitalized. This revenue procedure also provides procedures for obtaining automatic consent to change to the safe harbor method for linear property and non-linear property.
  • Notice 2023-33: This notice provides the corporate bond monthly yield curve and corresponding spot segment rates and the 24-month average segment rates for April 2023. This notice also provides guidance as to interest rates on 30-year Treasury securities and 30-year Treasury weighted average rates.
  • Revenue Ruling 2023-8: This revenue ruling obsoletes Revenue Ruling 58-74 relating to the deductibility of research or experimental expenditures for prior taxable years to which the expense method is applicable. There are insufficient facts in Revenue Ruling 58-74 to properly analyze whether a taxpayer’s failure to deduct certain research or experimental expenditures (when it deducted other research or experimental expenditures) constituted a method of accounting or an error.

May 1, 2023: The IRS released Tax Tip 2053-59, highlighting the Small Business Virtual Tax Workshop. This resource can help business owners learn how to navigate their federal tax responsibilities and is an easy and convenient way for both new and experienced small business owners to learn or review topics relevant to their businesses.

May 2, 2023: The IRS announced that Florida storm victims now have until August 15, 2023, to file various federal individual and business tax returns and make tax payments as a result of tornados, severe storms and flooding that occurred from April 12 to April 14, 2023. Relief is available to anyone in an area designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual or public assistance. The current list of eligible localities is available here.

May 2, 2023: The IRS released Tax Tip 2023-60, suggesting tools and resources to help small businesses.

May 2, 2023: The IRS urged business taxpayers to begin planning now to take advantage of tax benefits and to prepare for reporting changes that take effect in 2023. This reminder comes as part of National Small Business Week, where the IRS is joining the Small Business Administration and others in both the public and private sector to celebrate the hard work, ingenuity and dedication of small businesses and their contributions to [...]

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