Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of February 15, 2021 – February 19, 2021. Additionally, for continuing updates on the tax impact of COVID-19, please visit our resource page here.
February 16, 2021: The IRS issued Revenue Ruling 21-05, which provides the applicable short-, mid- and long-term applicable federal rates for the month of March. These rates are used for purposes of section 1274(d), which relates to the determination of issue price in the case of certain debt instruments issued for property.
February 16, 2021: The IRS issued Notice 21-16 providing guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used in section 417(e)(3) and the 24-month average segment rates under section 430(h)(2). In addition, the notice provides guidance as to the interest rate on 30-year US Department of the Treasury securities under section 417(e)(3)(A)(ii)(II) and the 30-year Treasury weighted average rate under section 431(c)(6)(E)(ii)(I).
February 18, 2021: The IRS issued Notice 21-15 clarifying the application of section 214 which provides temporary special rules for health flexible spending arrangements and dependent care assistance programs under section 125 cafeteria plans. (For more information, see our On the Subject here.)
February 18, 2021: The IRS released Internal Revenue Bulletin 2021-8, dated February 22, 2021, containing the following highlights: Announcement 2021-2 (Administrative); Announcement 2021-3 (Administrative); and Rev. Proc. 2021-15 (Administrative).
February 19, 2021: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).
Special thanks to Samuel DiPietro in our Chicago office for this week’s roundup.