fraudulent tax returns Archives - TAX CONTROVERSY 360

Weekly IRS Roundup May 30 – June 2, 2023

by Sarah M. Raben | Jun 5, 2023 | 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 May 30, 2023 – June 2, 2023.

May 30, 2023: The IRS released Internal Revenue Bulletin 2023-22, which highlights the following:

Notice 2023-39: This notice describes proposed amendments to Section 148 that the US Department of the Treasury (Treasury) and the IRS intend to issue regarding an exception to arbitrage investment restrictions applicable to bonds on which the interest is excludable from gross income under Section 103(a) (tax-exempt bonds). Specifically, the forthcoming proposed regulations will amend Section 1.148-11(d)(1)(i)(F) regarding whether certain perpetual trust funds created and controlled by states that are pledged as credit enhancements to guarantee tax-exempt bonds will be treated as replacement proceeds of the guaranteed bonds for purposes of the arbitrage investment restrictions on tax-exempt bonds under Section 148.

Revenue Procedure 2023-23: This procedure provides the 2024 inflation-adjusted amounts for Health Savings Accounts as determined under Section 223, as well as the maximum amount that may be made newly available for excepted benefit health reimbursement arrangements provided under Section 54.9831-1(c)(3)(viii) of the Pension Excise Tax Regulations.

Notice 2023-40: This notice sets forth updates on the corporate bond monthly yield curve, the corresponding spot segment rates used under Sec. 417(e)(3)(D) and the 24-month average segment rates applicable for May 2023. This notice also provides the 30-year Treasury rates, as reflected by the application of Sec. 430(h)(2)(C)(iv).

Notice 2023-38: This notice provides the general rules taxpayers must satisfy to qualify for the domestic content bonus credit amounts and the related recordkeeping and certification requirements. The guidance also describes a safe harbor regarding the classification of certain components in representative types of qualified facilities, energy projects or energy storage technologies.

May 30, 2023: The IRS released Tax Tip 2023-73, reminding taxpayers that the extended deadline to file their 2019 tax returns for unclaimed refunds is July 17, 2023. Taxpayers usually have three years to file; however, the deadline was postponed due to the COVID-19 pandemic.

May 30, 2023: The IRS requested comments on Form 1041, U.S. Income Tax Return for Estates and Trusts, related Schedules D, I, J and K-1, and Form 1041-V. Comments should be received on or before July 31, 2023.

May 30, 2023: The IRS reminded taxpayers living and working abroad to file their 2022 federal income tax return by the June 15 deadline. This applies to both US citizens and resident aliens abroad, including those with dual citizenship.

May 31, 2023: The Treasury and the IRS announced guidance for applicants investing in solar- and wind-powered electricity generation facilities. Notice 2023-17 established the Low-Income Communities Bonus Credit Program back in February 2023 and provided initial guidance for potential applicants. The proposed regulations request comments on certain definitions [...]

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Weekly IRS Roundup May 22 – May 26, 2023

by Sarah M. Raben | May 30, 2023 | 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 May 22, 2023 – May 26, 2023.

May 22, 2023: The IRS released Internal Revenue Bulletin 2023-21, which highlights the following:

Notice 2023-36: This notice from the US Department of the Treasury (Treasury) and the IRS invites recommendations for the 2023-2024 Priority Guidance Plan. The Priority Guidance Plan is used to identify and prioritize tax issues that should be addressed through regulations, revenue rulings, revenue procedures, notices and other published administrative guidance.

Announcement 2023-15: This announcement provides the revocation of IRC 501(c)(3) organizations for failure to meet the code section requirements. Contributions made to the organization by individual donors are no longer deductible under Section 170(c).

REG-124064-19: These proposed regulations related to Section 367(d), Rules for Certain Repatriations of Intangible Property, would (in certain instances) terminate the continued application of certain tax provisions after the previous transfer of intangible property to a foreign corporation when the intangible property is repatriated to certain US persons.

May 22, 2023: The IRS announced that interest rates will remain the same for the calendar quarter beginning July 1, 2023. Revenue Ruling 2023-11 establishes the interest rates as follows:

Overpayments: 7%
Overpayments for corporations: 6%
Corporate overpayments for portions exceeding $10,000: 4.5%
Underpayments: 7%
Large corporate underpayments: 9%

May 23, 2023: The IRS released Tax Tip 2023-70, reminding taxpayers that requesting an Identity Protection PIN can help stop identity thieves from filing fraudulent tax returns. An Identity Protection PIN is a six-digit number used to prove taxpayers’ identities when filing their federal tax returns.

May 24, 2023: The IRS released Tax Tip 2023-71, providing guidance on how taxpayers can best prepare to request an appeal after the IRS rejects an offer in compromise. After the IRS rejects an offer in compromise, taxpayers have 30 days to request an appeal of the decision.

May 25, 2023: The IRS renewed an alert for businesses to watch out for the telltale signs of misleading claims by aggressive promoters that misrepresent who can qualify for the Employee Retention Credit. The alert reminds taxpayers that businesses improperly claiming the credit must pay it back, possibly with penalties and interest.

May 25, 2023: The IRS released Notice 2023-43, which provides guidance with respect to Section 305 of the SECURE 2.0 Act of 2022. Section 305 provides for the expansion of the Employee Plans Compliance Resolution System, currently set forth in Revenue Procedure 2021-30. This notice provides interim guidance in advance of any updates to Revenue Procedure 2021-31 and is not intended to be comprehensive.

May 25, 2023: The IRS released Tax Tip 2023-72, announcing that improvements to IRS phone service and online options are coming as a result of the Inflation [...]

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IRS Opposes Granting of Certiorari in Cases Addressing Definition of Return

by McDermott Will & Emery and Roger J. Jones | Mar 16, 2017 | Appellate Courts, Court Procedure Matters, IRS Guidance, Uncategorized

Two petitions for certiorari pending before the Supreme Court of the United States ask the Court to resolve the question of whether a tax return filed after an assessment by the Internal Revenue Service (IRS) is a “return” for purposes of the Bankruptcy Code (BC). The answer to this question will determine whether a bankrupt taxpayer’s tax debts can be discharged or are permanently barred from discharge. According to these petitions, the courts of appeal are divided as to the answer.

BC § 523(a) generally allows a debtor to discharge unsecured debt, except for, inter alia, tax debts of debtors who: (1) failed to file tax returns; (2) filed fraudulent tax returns; or (3) filed late tax returns, where a bankruptcy petition is filed within two years of the date the late return was filed. See BC § 523(a)(1)(B)(i), (B)(ii), (C).

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