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Weekly IRS Roundup September 14 – September 18, 2020

by McDermott Will & Emery | Sep 22, 2020 | IRS Guidance, Tax Reform

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of September 14, 2020 – September 18, 2020. Additionally, for continuing updates on the tax impact of COVID-19, please visit our resource page here.

September 14, 2020: The IRS published final regulations providing guidance on the limitation on the deduction for business interest expense after amendment of the Internal Revenue Code (Code) by the Tax Cuts and Jobs Act (TCJA) and the Coronavirus Aid, Relief and Economic Security Act (CARES Act). The regulations provide guidance to taxpayers on how to calculate the limitation, what constitutes interest for purposes of the limitation, which taxpayers and trades or businesses are subject to the limitation and how the limitation applies in consolidated group, partnership, international and other contexts. The final regulations vary slightly from the document released on IRS.gov on July 28, 2020.

September 14, 2020: The IRS published a criminal tax bulletin concerning recent case law involving the Criminal Tax Division.

September 15, 2020: The IRS published Rev. Rul. 2020-20 that provides various prescribed rates for federal income tax purposes for October 2020, including: (1) the applicable federal rates (AFR) under section 1274(d); (2) the adjusted applicable federal rates (adjusted AFR) under section 1288(b); (3) the adjusted federal long-term rate and the long-term tax-exempt rate under section 382(f); (4) the appropriate percentages for determining the low-income housing credit under Section 42(b)(1); and (5) the federal rate for determining the present value of an annuity, an interest for life or for a term of years or a remainder or a reversionary interest under section 7520.

September 15, 2020: The IRS published a practice unit covering Last In-First Out (LIFO) inventories under various LIFO methods.

September 15, 2020: The IRS released for future publication in the Federal Register final regulations concerning the definition of an eligible terminated S corporation and rules relating to distributions of money by such a corporation after the post-termination transition period. The regulation package also amends current regulations to extend the treatment of distributions of money during the post-termination transition period to all shareholders of the corporation and clarifies the allocation of current earnings and profits to distributions of money and other property. The final regulations affect C corporations that were formerly S corporations and the shareholders of such corporations.

September 16, 2020: The IRS published a memorandum providing flexibility for taxpayers who are temporarily unable to meet the payment terms on accepted offers due to the economic impact of COVID-19. The procedures will expire December 31, 2020, unless extended.

September 17, 2020: The IRS published a practice unit providing an overview of the Overall Foreign Loss (OFL), Separate Limitation Loss (SLL) and Overall Domestic Loss (ODL) rules, as well as related examples.

September 17, 2020: The IRS
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Yeehaw! McDermott’s Tax Weekly Round Up

by McDermott Will & Emery | Jun 18, 2018 | IRS Guidance, Tax Reform, Uncategorized

Here’s what happened in the world of IRS guidance for the week June 11 – 15, 2018.

June 11, 2018: The IRS issued Notice 2018-55 describing potential proposed regulations that would offer relief to some private colleges and universities by providing a stepped-up basis rule that could reduce the amount of gain subject to a new 1.4 percent excise tax on their endowments.

June 12, 2018: The IRS issued proposed regulations, under Code section 148 applicable to tax-exempt and other tax-advantaged bonds, aimed to restrict arbitrage investments and providing an exception to the definition of investment-type property for capital projects that further the public purpose for which the bonds were issued.

June 12, 2018: Pursuant to its continuing effort to reduce paperwork, the IRS requested comments on a number of published guidance, including: Rev. Proc. 2003-33 (extension of time to file a section 338 election to treat stock purchases as asset acquisitions); TD 8379 and TD 9407 (regulations regarding the manner and method of reporting and paying the excise tax on the receipt of greenmail); TD 8791 (relating to charitable remainder trusts and to special valuation rules for transfers of interests in trusts); and, TD 8571 (relating to the reporting of certain information relating to payments of mortgage interest). All comments are due by August 13, 2018.

June 15, 2018: The IRS announced the corporate bond monthly yield curve, the 24-month average segments rats, the 30-year Treasury securities interest rate, the 30-year Treasury weighted average rate, and the minimum present-value segment rates in Notice 2018-56.

June 15, 2018: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandum and Chief Counsel Advice).

Special thanks to Christy Vouri and Greg Berson in our DC office for this week’s round-up.

IRS Releases Second Quarter Update to 2017-2018 Priority Guidance Plan

by Kevin Spencer and McDermott Will & Emery | Feb 9, 2018 | IRS Guidance, Uncategorized

On February 7, 2018, the Department of the Treasury (Treasury) released its second quarter update to the 2017-2018 Priority Guidance Plan to identify tax issues it believes should be addressed through regulations, revenue rulings, revenue procedures, notices and other published administrative guidance. The Priority Guidance Plan contains projects the Treasury hopes to complete during the 12-month period from July 2, 2017 through June 30, 2018. We previously posted on the first quarter 2017-2018 Priority Guidance plan here.

Most of the projects do not involve the issuance of new regulations, instead focus on guidance to taxpayers on a variety of tax issues important to individuals and businesses in the form of: (1) revocations of final, temporary, or proposed regulations (for our prior coverage, see here); (2) notices, revenue rulings and revenue procedures; (3) simplifying and burden reducing amendments to existing regulations; (4) proposed regulations; or (5) final regulations adopting proposed regulations. The initial 2017-2108 Priority Guidance Plan consisted of 198 guidance projects, 30 of which have already been completed. The second quarter update reflects 29 additional projects, including priority items as a result of the Tax Cuts and Jobs Act (TCJA) legislation enacted on December 22, 2017, and guidance published or released from October 13, 2017 through December 31, 2017.

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Tax Reform: Insurance Provisions—Spotlight on Property & Casualty Insurers

by Kristen E. Hazel, Michael J. Wilder and Michael F. Kelleher | Dec 7, 2017 | Tax Reform, Uncategorized

A number of provisions included in the Senate’s tax reform bill, H.R. 1 (the Senate Bill) would impact the insurance sector. Many of the provisions would affect only the life insurance industry. Others affect property & casualty (P&C) insurance companies. Still others affect both life and P&C insurance companies.

Many of these proposals align with proposals in the tax reform bill passed by the House of Representatives and given that alignment, may be on the way to becoming law. We will be watching these provisions closely as this historic tax reform initiative proceeds. Continue Reading