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Weekly IRS Roundup January 23 – January 27, 2023

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of January 23, 2023 – January 27, 2023.

January 23, 2023: The IRS released Internal Revenue Bulletin 2023-4, which highlights the following:

  • Proposed Regulation 114666-22: This proposed regulation modifies the participant election rules in Section 1.401(a)-21(d), providing an alternative to in-person witnessing of spousal consents required to be witnessed by a notary public or plan representative. The proposed regulation also clarifies that certain rules for the use of an electronic medium for participant elections also apply to spousal consents.

January 23, 2023: The IRS is requesting comments concerning Form 5227, Split-Interest Trust Information Return, which is used to report the financial activities of a split-interest trust described in Section 4947(a)(2) and determine whether the trust is treated as a private foundation and thus subject to excise taxes. Written comments should be received by March 24, 2023.

January 23, 2023: The IRS announced the beginning of the 2023 tax filing season, with a focus on improving customer service. The IRS also urged taxpayers to file their returns electronically with direct deposit to expedite refunds and avoid delays. The deadline for most people to file tax returns this year is April 18, 2023, however, storm victims in Alabama, California and Georgia have until May 15, 2023.

January 23, 2023: The IRS is requesting comments related to proceeds of bonds used for reimbursement. This regulation clarifies when the allocation of bond proceeds to reimburse expenditures previously made by an issuer of the bond is treated as an expenditure of the bond proceeds. Written comments should be received by March 24, 2023.

January 23, 2023: The IRS released Tax Tip 2023-06, which provides information about the adoption tax credit for families with adoption-related expenses. Taxpayers must complete Form 8839 to claim the credit and attach it to their tax return.

January 24, 2023: The IRS reminded taxpayers that they must answer a digital asset question and report all digital asset-related income when filing their 2022 federal income tax return. This is the same procedure as fiscal year 2021. The term “digital assets” has replaced “virtual currencies,” which was a term used in previous years. The question appears at the top of Forms 1040, Individual Income Tax Return; 1040-SR, U.S. Tax Return for Seniors; and 1040-NR, U.S. Nonresident Alien Income Tax Return.

January 24, 2023: The IRS reminded taxpayers to choose their tax preparer carefully. Taxpayers are ultimately responsible for all the information on their income tax return, regardless of who prepares it. Anyone who is paid to prepare federal tax returns must have a valid Preparer Tax Identification Number.

January 24, 2023: The IRS released Tax Tip 2023-07, urging taxpayers to avoid common mistakes when filing their tax returns by carefully reviewing them. [...]

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Weekly IRS Roundup January 17 – January 20, 2023

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of January 17, 2023 – January 20, 2023.

January 17, 2023: The IRS released Internal Revenue Bulletin 2023-3, which highlights the following:

  • Notice 2023-10: This notice provides that calendar year 2022 will be a transition period for purposes of implementing the $600 reporting threshold for third-party settlement organizations. As a result, third-party organizations will not be required to report tax year 2022 transactions on Form 1099-K to the IRS or the payee for the lower $600 threshold amount unless the amount exceeds $20,000 and the number of transactions exceeds 200.
  • Notice 2023-2: This notice provides interim guidance on the new 1% excise tax on a covered corporation’s repurchases of corporate stock under Section 4501. Section 4501 was added as part of the Inflation Reduction Act of 2022 (IRA). The notice provides an exclusive list of Section 317(b) redemption transactions that are treated as Section 317(b) redemption but are not repurchases, as well as an exclusive list of economically similar transactions. The notice applies to stock repurchases and issuances of stock made after December 31, 2022.
  • Announcement 2023-1: This announcement notifies taxpayers of the applicable reference standard that must be used to determine the amount of the energy-efficient commercial building property deduction allowed under Section 179D, as amended by the IRA. This announcement identifies the existing reference standard, affirms a new one and clarifies when the two reference standards will apply.
  • Notice 2023-1: This notice informs taxpayers that the IRS and the US Department of the Treasury (Treasury) intend to propose new clean vehicle credit regulations, addressing the definitions of certain terms in Section 30D.
  • Notice 2023-03: This notice provides the 2023 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes. As of January 1, 2023, the standard mileage rates for the use of a car, van, pickup or panel truck are:
    • 5 cents per mile driven for business use
    • 22 cents per mile driven for medical or moving purposes for qualified active-duty members of the armed forces
    • 14 cents per mile driven in service of charitable organizations
  • Notice 2023-7: This notice announces that the IRS and the Treasury plan to issue guidance on the new corporate alternative minimum tax (CAMT), which imposes a 15% minimum tax on the adjusted financial statement income of large corporations for taxable years beginning after December 31, 2022. It also clarifies which corporations the CAMT applies to and how the alternative minimum tax is calculated.
  • Notice 2023-9: This notice informs taxpayers that the Treasury and the IRS have reviewed the incremental cost for all street vehicles in calendar year 2023 and the analysis shows [...]

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