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Weekly IRS Roundup February 13 – February 17, 2023

by | Feb 21, 2023 | , ,

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of February 13, 2023 – February 17, 2023.

February 13, 2023: The IRS released Internal Revenue Bulletin 2023-7, which highlights the following:

  • Revenue Procedure 2023-9: This procedure provides new rules and conditions for implementing the optional safe harbor method of accounting for real estate developers to determine when common improvement costs may be included in the basis of individual units of real property in a real property development project held for sale to determine the gain or loss from sales of those units (the Alternative Cost Method).

February 13, 2023: The IRS announced that interest rates will remain the same for the second quarter of 2023. As of April 1, 2023, the rates will be as follows:

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

Revenue Ruling 2023-4 contains the complete explanation of the calculations.

February 13, 2023: The IRS announced a new pilot phase for the Compliance Assurance Process (CAP) program called “Bridge Plus.” CAP is a cooperative pre-filing program for large corporate taxpayers. Taxpayers will be required to provide book-to-tax reconciliations, credit utilization and other supporting documentation shortly after their audited financial statement is finalized. An IRS team will then risk-assess the documents to determine if the taxpayer is suitable for the “Bridge Plus” phase.

February 13, 2023: The US Department of the Treasury (Treasury) and the IRS announced guidance to establish a program that would provide solar and wind power to certain low-income areas under the Inflation Reduction Act of 2022. Notice 2023-17 establishes the Low-Income Communities Bonus Credit Program and provides initial guidance for potential applicants for allocations of calendar year 2023 capacity limitation.

February 13, 2023: The IRS and the Treasury announced guidance on the Qualifying Advanced Energy Product Credit. Notice 2023-18 establishes the Section 48C(e) program to allocate $10 billion in credits ($4 billion of which may only be allocated to projects located in certain energy communities census tracts). The notice also provides initial program guidance. The goal of the program is to expand US manufacturing capacity and quality jobs for clean energy technologies (including production and recycling), reduce greenhouse gas emissions in the US industrial sector and secure domestic supply chains for critical materials (including specified critical minerals) that serve as inputs for clean energy technology production.

February 13, 2023: The IRS released Tax Tip 2023-18, reminding people that the Earned Income Tax Credit is a major tax benefit for millions of low- and moderate-income workers. Taxpayers can check their eligibility and how much they qualify for here.

February 14, 2023: The IRS released Tax Tip 2023-19, providing resources and suggestions for choosing [...]

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Weekly IRS Roundup February 6 – February 10, 2023

by | Feb 13, 2023 | , ,

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of February 6, 2023 – February 10, 2023.

February 6, 2023: The IRS released Internal Revenue Bulletin 2023-6, which highlights the following:

  • Notice 2023-12: This notice provides updates on the corporate bond monthly yield curve and corresponding spot segment rates and the 24-month average segment rates for January 2023. The notice also provides guidance as to interest rates on 30-year Treasury securities and 30-year Treasury weighted average rates.
  • Notice 2023-13: This notice sets forth a proposed revenue procedure establishing the Service Industry Tip Compliance Agreement (SITCA) program. SITCA is a voluntary tip reporting program between the IRS and employers in the service industry that is designed to enhance tax compliance through the use of agreements instead of traditional audit techniques.
  • Revenue Procedure 2023-14: This guidance provides the tables of limitations on depreciation deductions for owners of passenger automobiles placed in during calendar year 2023 and the table dollar amounts that must be used to determine income inclusions by lessees of passenger automobiles with a lease term beginning in calendar year 2023.
  • Revenue Ruling 2023-3: This revenue ruling provides the applicable federal rates for federal income tax purposes for February 2023. The short-term federal interest rate is 4.47%, the mid-term is 3.82% and the long-term rate is 3.86%.

February 6, 2023: The IRS released Tax Tip 2023-14, highlighting the Taxpayer Bill of Rights, which include the Right to be Informed. Taxpayers have the right to know what they need to do to comply with the tax laws.

February 6, 2023: The IRS and the US Department of the Treasury (Treasury) announced a new program for service industry tip reporting. The proposed SITCA program is designed to take advantage of advancements in point-of-sale, time and attendance systems, and electronic payment settlement methods to improve tip reporting compliance. The proposed program would also decrease taxpayer and IRS administrative burdens and provide more transparency and certainty to taxpayers.

February 6, 2023: The IRS announced special Saturday hours for the next four months at Taxpayer Assistance Centers across the country. The Saturday hours will take place on February 11, March 11, April 8 and May 13 from 9:00 am to 4:00 pm.

February 7, 2023: The IRS released Tax Tip 2023-15, providing information to help business travelers properly claim travel business deductions.

February 8, 2023: The IRS released Announcement 2023-6, which notifies the public that it intends to issue opinion letters by February 28, 2023, for preapproved defined benefit plans that were updated for changes in plan qualification requirements and filed with the IRS during the third six-year remedial amendment cycle. This announcement also notifies the public of the date by which an adopting employer [...]

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Weekly IRS Roundup January 30 – February 3, 2023

by | Feb 6, 2023 | , ,

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of January 30, 2023 – February 3, 2023.

January 30, 2023: The IRS released Internal Revenue Bulletin 2023-5, which highlights the following:

  • Announcement 2023-5: This announcement provides notice that there were no articles submitted for this week’s publication.

January 30, 2023: The IRS released Tax Tip 2023-10, reminding employers and businesses that the due date to file 2022 Form W-2, Form W-3 and Form 1099-NEC is January 31, 2023.

January 31, 2023: The IRS offered a checklist of reminders for people as they navigate tax season and prepare to file their 2022 tax returns. The list includes gathering all tax paperwork, remembering all types of income and choosing a tax professional carefully.

January 31, 2023: The IRS released Tax Tip 2023-11, urging people to bookmark IRS.gov tools to help reduce the stress of filing season. The Let Us Help You page has information and resources on a wide range of topics for both individual taxpayers and businesses.

February 1, 2023: The IRS released Tax Tip 2023-12, highlighting IRS Free File for first-time filers. The program provides free tax preparation, free electronic filing and free direct deposit for eligible taxpayers.

February 2, 2023: The IRS released Tax Tip 2023-13, urging taxpayers to have their tax refund direct deposited. The IRS says that direct deposit is fast, secure, easy and provides options for splitting a refund.

February 2, 2023: The IRS issued proposed regulations, which would rescind the moral objection to the coverage of contraceptive services under the Affordable Care Act. The proposed rules also would establish a new individual contraceptive arrangement that individuals enrolled in plans or coverage provided by objecting entities may use to obtain contraceptive services at no cost directly from a provider or facility that furnishes contraceptive services. Comments should be received by April 3, 2023.

February 3, 2023: The IRS announced that it has released new guidance related to new, previously owned and qualified commercial clean vehicle credits and updated related FAQs in Fact Sheet 2023-4. Notice 2023-16 modifies the definition of certain vehicle classifications for the clean vehicle credits.

February 3, 2023: The IRS released a statement regarding the taxability of state payments made in 2022. The IRS is working with state tax officials to provide additional information and hopes to provide additional clarity by next week. The IRS recommends waiting until additional guidance is available if taxpayers are uncertain about the taxability of their state payments. The IRS does not recommend calling the IRS or amending a previously filed 2022 return.

February 3, 2023: The IRS released a report entitled, IRS Progress Update for Fiscal Year 2022. The publication [...]

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Weekly IRS Roundup January 23 – January 27, 2023

by | Jan 30, 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

by | Jan 23, 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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Weekly IRS Roundup November 14 – November 18, 2022

by | Nov 21, 2022 | , ,

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of November 14, 2022 – November 18, 2022.

November 14, 2022: The IRS released Internal Revenue Bulletin 2022-46, which highlights the following:

  • Announcement 2022-21: The Office of Professional Responsibility announced recent disciplinary sanctions involving lawyers, certified public accountants, enrolled agents, enrolled actuaries, enrolled retirement plan agents and appraisers.

November 14, 2022: The IRS released Notice 2022-59, which provides the adjusted applicable dollar amount to be multiplied by the average number of covered lives for purposes of calculating the fee imposed by Sections 4375 and 4376 for policy years and plan years that end on or after October 1, 2022, and before October 1, 2023. The amount is $3.00, up from $2.79.

November 14, 2022: The IRS released Tax Tip 2022-174, which provides an overview of the Taxpayer Bill of Rights (TBOR). We have previously posted about TBOR.

November 15, 2022: The IRS released Tax Tip 2022-175, reminding people that Giving Tuesday is coming up and is a good time to review whether their charitable donation is tax deductible. Giving Tuesday is the Tuesday after Thanksgiving.

November 15, 2022: The IRS reminded taxpayers that IRS Free File will be closed after November 17. IRS Free File allows people with incomes of $73,000 or less to file a return online for free using brand name software.

November 15, 2022: The IRS Advisory Council issued its 2022 Public Report, which includes recommendations for new and continuing issues in tax administration. The report emphasized the need for “consistent and multi-year funding for the IRS to achieve its goals of providing efficient, effective, modern service to the nation’s taxpayers.” The 146-page report details recommendations for 21 issues, including:

  • IRS business and information technology modernization
  • Reduction in electronic filing threshold for information return filers
  • Alignment of electronic signature requirements on withholding certificates
  • Accelerated issuance of IRS Form 6166, Certification of US Residency
  • Series 8038 Form Redesign and Updates
  • Business Master File Transcript Delivery Service

November 15, 2022: The IRS issued Revenue Rule 2022-22, which provides the applicable federal rates for federal income tax purposes for December 2022. The short-term federal interest rate will increase to 4.55%, the mid-term rate will rise to 4.27% and the long-term rate will rise to 4.34%.

November 16, 2022: The IRS released Revenue Procedure 2022-39, which obsoletes Revenue Procedure 94-69, 1994-2 C.B. 804, and sets out the procedures for eligible taxpayers to file an amended return in accordance with Section 1.6664-2(c)(4)(ii) of the regulations. This revenue procedure also sets out the procedures for eligible taxpayers to avoid the Sections 6662(b)(1) and 6662(b)(2) accuracy related penalties to the extent that the taxpayers report errors resulting in additional tax or adequately discloses the tax treatment of an [...]

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Weekly IRS Roundup September 12 – September 16, 2022

by | Sep 19, 2022 | , , ,

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of September 12, 2022 – September 16, 2022.

September 12, 2022: The IRS released Internal Revenue Bulletin 2022-37, which highlights the following:

  • Treasury Decision 9965: These regulations establish certain requirements regarding the implementation of protections against balance billing provided under the No Surprise Act.
  • Notice 2022-37: This guidance assists taxpayers in complying with the final regulations under Section 871(m). The US Department of the Treasury (Treasury) and the IRS intend to amend Section 871(m) regulations, which will delay the effective date of certain rules in the final regulations and extend the phase-in period provided in Notice 2020-2 for two years.

September 12, 2022: The IRS released COVID Tax Tip 2022-139, reminding taxpayers of recently issued Notice 2022-36, which provides penalty relief from certain failure to file penalties in taxable years 2019 and 2020. The relevant penalties will be waived, abated, refunded or credited. The relief is designed to help struggling taxpayers affected by the COVID-19 pandemic and to allow the IRS to focus resources on processing backlogged tax returns and taxpayer correspondence.

September 12, 2022: The Treasury Inspector General for Tax Administration (TIGTA) released the Fiscal Year 2022 Statutory Review of Compliance With Notice of Federal Tax Lien Filing Due Process Procedures. TIGTA is required to determine annually whether lien notices issued by the IRS comply with the legal requirements set forth in the Internal Revenue Code. TIGTA recommended that the Director of Collection Policy for the Small Business/Self-Employed Division (1) reinforce Internal Revenue Manual (IRM) guidance to ensure that taxpayers’ representatives are notified of Notice of Federal Tax Lien filings and (2) correct an IRM reference on Written Communication to a Taxpayer’s Authorized Representative. The IRS agreed.

September 12, 2022: TIGTA released its report entitled, Reliance on Self-Certifications Resulted in Federal Agencies Awarding Contracts and Grants to Entities With Delinquent Federal Taxes; However, the IRS Is Making Progress on Establishing the Federal Contractor Tax Check System. TIGTA performed this audit because in Calendar Years 2015 and 2016, federal contracts were awarded to thousands of contractors with unpaid taxes that were most likely delinquent. Between October 2018 and December 2019, the federal government awarded 2.1 million federal contracts to more than 83,000 awardees. More than 3,000 contractors that received contracts owned $621.8 million in delinquent federal taxes, and 938 grantees received $22.7 billion in federal grants while owning $269.2 million in delinquent federal taxes.

September 12, 2022: The IRS issued minor corrections to Treasury Decision 9964, originally published August 16, 2022. The regulations define guidance for states regarding the process by which they may obtain or inspect certain returns and return information for the purpose of administering state laws governing certain tax-exempt organizations and their activities.

September [...]

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Weekly IRS Roundup April 10 – April 16, 2022

by | Apr 18, 2022 | , ,

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of April 10, 2022 – April 16, 2022. Additionally, for continuing updates on the tax impact of COVID-19, please visit our resource page here.

April 11, 2022: The IRS issued a news release, reminding taxpayers of the option to obtain an Identity Protection PIN to guard against tax-related identity theft.

April 12, 2022: The IRS issued a news release announcing the mailing of letters to certain taxpayers, notifying them of additional actions that must be taken to comply with the administrative requirements applicable to Qualified Opportunity Funds (QOFs).

April 12, 2022: The IRS issued a news release addressing certain common misconceptions regarding income tax refunds.

April 13, 2022: The IRS issued a news release, urging taxpayers who have filed their 2021 individual income tax returns to use the IRS Tax Withholding Estimator to ensure they are subject to an appropriate level of salary withholding for 2022.

April 13, 2022: The IRS issued a news release, providing an update to a Fact Sheet containing answers to frequently asked questions regarding the 2020 Recovery Rebate Credit, enacted as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act.

April 13, 2022: The IRS issued a news release, providing an update to a Fact Sheet containing answers to frequently asked questions regarding the 2021 Recovery Rebate Credit, enacted as part of the American Rescue Plan Act of 2021 (ARPA).

April 14, 2022: The IRS issued a news release urging low- and moderate-income taxpayers to use IRS Free File to prepare and electronically file their tax returns.

April 14, 2022: The IRS issued a news release, reminding taxpayers of the resources available on irs.gov that can answer their tax questions.

April 15, 2022: The IRS issued Notice 2022-15, providing relief (for Q3 2022 through Q1 2023) with respect to penalties under Section 6656 of the Code for failure to make deposits of “Superfund” chemical taxes under Sections 4661 and 4671 of the Code, as reinstated by the Infrastructure Investment and Jobs Act (IIJA). The Notice also provides that, for Q1 2023 through Q3 2023, and subject to certain conditions, the IRS will not prohibit a taxpayer from using the Treas. Reg. § 40.6302(c)-1(b)(2)(v) “deposit safe harbor” if the taxpayer fails to make deposits of Superfund chemical taxes.

April 15, 2022: The IRS issued a news release, notifying taxpayers that CP2100 and CP2100A notices, which are sent semiannually to notify taxpayers who filed certain information returns that information on the returns does not match IRS records, will be sent out beginning in mid-April 2022.

April 15, 2022: The IRS issued a news release, reminding [...]

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Weekly IRS Roundup April 12 – April 16, 2021

by | Apr 19, 2021 | ,

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of April 12, 2021 – April 16, 2021. Additionally, for continuing updates on the tax impact of COVID-19, please visit our resource page here.

April 12, 2021: The IRS issued proposed regulations setting forth requirements that certain foreign taxpayers must meet in order to obtain the benefits of investing in a qualified opportunity fund (QOF) under section 1400Z-2 of the Code. The proposed regulations also expand the flexibility of a disaster-related working capital safe harbor in the existing QOF regulations.

April 13, 2021: The IRS issued Notice 2021-24, extending previously announced relief from penalties for failure to make timely deposits of employment taxes. The Notice extends relief to apply to deposits reduced in anticipation of certain employment tax credits with respect to qualified leave wages and Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation coverage premiums during 2021.

April 13, 2021: The IRS issued Notice 2021-27, providing the monthly update to certain interest rates used for pension plan funding and distribution purposes.

April 13, 2021: The IRS issued a news release urging low and moderate income taxpayers to use IRS Free File to prepare and electronically file their tax returns.

April 14, 2021: The IRS issued Notice 2021-28, inviting the public to submit recommendations for items to be included on the 2021-2022 Priority Guidance Plan.

April 14, 2021: The IRS issued a news release announcing a fifth round of Economic Impact Payments consisting of over two million payments totaling over $3.4 billion, bringing the total amount of disbursements under the American Rescue Plan of 2021 to approximately 159 million payments worth more than $376 billion.

April 15, 2021: The IRS issued Revenue Ruling 2021-08, providing various prescribed interest rates for federal income tax purposes for May 2021.

April 15, 2021: The IRS issued a news release emphasizing that individuals experiencing homelessness may still qualify for tax benefits such as Economic Impact Payments and urged community groups and employers to share information and help such individuals file tax returns so that they can obtain such benefits.

April 16, 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 Le Chen in our Washington, DC, office for this week’s roundup.



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