Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of September 23 – 27, 2019.

September 24, 2019: The IRS issued a notice that provides a safe harbor under which a rental real estate enterprise will be treated as a trade or business for purposes of section 199A and the regulations thereunder. The IRS explained that if the safe harbor requirements are met, the rental real estate enterprise will be treated as a single trade or business as defined in section 199A(d) for purposes of applying the regulations under section 199A. Each rental real estate enterprise will be treated as a single trade or business if the following requirements are satisfied during the taxable year with respect to the rental real estate enterprise: (1) separate books and records are maintained to reflect income and expenses for each enterprise; (2) for enterprises in existence less than four years, 250 or more hours of rental services are performed per year; (3) taxpayer maintains contemporaneous records on hours of services performed, description of services, dates of services, and who performed such services; and (4) taxpayer attaches a statement with information such as a description of the properties, to a timely filed original return for each year in which the enterprise relies on the safe harbor. 

September 26, 2019: The Treasury and the IRS released proposed regulations that: (1) clarify the application of the employer shared responsibility provisions and certain nondiscrimination rules to reimbursement arrangements (HRAs) and other account-based group health plans integrated with individual health insurance coverage or Medicare (individual coverage HRAs); (2) provide certain safe harbors with respect to the application of those provisions to individual coverage HRAs; and (3) facilitate the adoption of individual coverage HRAs by employers by permitting taxpayers to rely on the proposed regulations. The proposed regulations would affect employers, employees and their family members, and plan sponsors.

September 27, 2019: The IRS released a Statistics of Income Bulletin focusing on individual income tax returns. The report contains data on sources of income, adjusted gross income, exemptions, deductions, taxable income, income tax, modified income tax, tax credits, self-employment tax, and tax payments. The report makes classifications by tax status, size of adjusted gross income, marital status, type of tax computation and age.

September 27, 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.