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Weekly IRS Roundup January 1 – January 5, 2024

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of January 1, 2024 – January 5, 2024.

January 2, 2024: The IRS released Internal Revenue Bulletin 2024-1, which includes the following:

  • Revenue Procedure 2024-1, which contains the revised procedures for letter rulings and information letters issued by the different offices of the associate chief counsel. This revenue procedure also contains the revised procedures for determination letters issued by the Large Business and International Division, the Small Business/Self-Employed Division, the Wage and Investment Division and the Tax Exempt and Government Entities (TE/GE) Division.
  • Revenue Procedure 2024-2, which explains when and how associate chief counsel offices should provide advice in technical advice memoranda (TAM). The revenue procedure also explains taxpayers’ rights when a field office requests a TAM.
  • Revenue Procedure 2024-3, which provides a revised list of areas of the Internal Revenue Code under the jurisdiction of the associate chief counsel’s offices of Corporate; Financial Institutions and Products; Income Tax and Accounting; Passthroughs and Special Industries; Procedure and Administration; and Employee Benefits, Exempt Organizations, and Employment Taxes. These relate to matters in which the IRS will not issue letter rulings or determination letters.
  • Revenue Procedure 2024-4, which provides guidance on the types of advice the IRS offers to taxpayers on issues under the jurisdiction of the Commissioner, TE/GE Division and Employee Plans Rulings and Agreements. It also details the procedures that apply to requests for determination letters and private letter rulings. This revenue procedure updates Revenue Procedure 2023-4.
  • Revenue Procedure 2024-5, which provides the procedures for issuing determination letters on issues under the jurisdiction of the Director, Exempt Organizations Rulings and Agreements.
  • Revenue Procedure 2024-7, which provides the areas under the jurisdiction of the associate chief counsel (international) in which letter rulings and determination letters will not be issued.

January 4, 2024: The IRS encouraged taxpayers to check out IRS.gov for tips, tools and resources to help them prepare to file their 2023 federal income tax returns.

January 4, 2024: The IRS published Tax Tip 2024-01, which provides a brief overview of tax credits and deductions for individuals.

January 5, 2024: The IRS announced an extension for dealers and sellers of clean vehicles to submit time-of-sale reports. Dealers and sellers generally will now have until January 19, 2024, to submit a time-of-sale report for vehicles sold from January 1, 2024, through January 16, 2024.

January 5, 2024: The IRS announced the launch of a special Tax Professional Awareness Week that will commence January 8, 2024, and assist tax professionals on what to expect during the 2024 filing season.

January 5, 2024: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief [...]

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Weekly IRS Roundup December 25 – December 29, 2023

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of December 25, 2023 – December 29, 2023.

December 26, 2023: The IRS released Internal Revenue Bulletin 2023-52, which includes the following:

  • Revenue Procedure 2023-39, which provides specifications for the private printing of red ink and black-and-white substitutes for the August 2023 revisions of Forms W-2c and W-3c. This revenue procedure supersedes Revenue Procedure 2016-20.
  • Notice 2023-79, which sets forth the 2023 Required Amendments List. The list applies to both individually designed plans under § 401(a) of the Internal Revenue Code and individually designed plans that satisfy the requirements of § 403(b).
  • Announcement 2023-35, which revokes § 501(c)(3) determinations for certain organization(s) and stipulates that contributions made to the organization(s) by individual donors are no longer deductible under § 170(b)(1)(A).
  • Notice 2023-80, which announces the intention to issue proposed regulations that address the application of the foreign tax credit (FTC) and dual consolidated losses in relation to the Global Anti-Base Erosion (GloBE) Model Rules. The notice also (i) extends the temporary relief period described in Notice 2023-55 for determining whether a foreign tax is eligible for an FTC pursuant to §§ 901 and 903 and (ii) addresses the application of the temporary relief with respect to partnerships and their partners.
  • Proposed regulations that would amend existing regulations related to the energy credit for the taxable year in which eligible energy property is placed in service pursuant to § 48. The proposed regulations also withdraw and repropose portions of previously proposed regulations regarding the increased energy credit amount available if prevailing wage and registered apprenticeship requirements are met. Comments must be received by January 22, 2024.
  • Revenue Procedure 2023-41, which sets forth the unpaid loss discount factors for the 2023 accident year pursuant to § 846 and prescribes the salvage discount factors for the 2023 accident year pursuant to § 832.

December 26, 2023: The IRS updated the Frequently Asked Questions (FAQs) in Fact Sheet 2023-29 to provide guidance on the critical mineral and battery component requirements with respect to the New, Previously Owned and Qualified Commercial Clean Vehicle Credits. The updates supersede the FAQs previously posted in Fact Sheet 2023-22.

December 28, 2023: The IRS issued Notice 2024-9, which provides how applicable entities can claim the statutory exception to the application of the phaseouts for elective payment projects that begin construction during calendar year 2024 and fail to satisfy the domestic content requirement.

December 28, 2023: The IRS issued proposed regulations that would provide guidance on whether a debt instrument is worthless for US federal income tax purposes pursuant to § 166. Comments must be received by February 26, 2024.

December 28, 2023: The IRS issued Notice 2024-11, [...]

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Weekly IRS Roundup December 11 – December 15, 2023

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of December 11, 2023 – December 15, 2023.

December 11, 2023: The IRS released Internal Revenue Bulletin 2023-50, which includes the following:

  • Proposed regulations that would update regulations under Internal Revenue Code (Code) §§ 267 and 707 to apply an entity approach to partnerships for purposes of applying loss limitation rules to related persons. The proposed regulations are intended to conform the existing regulations to current law. Comments and requests for a public hearing must be received by February 26, 2024.
  • Proposed regulations that relate to the calculation of foreign currency gains and losses under Code § 987. The proposed regulations include a current rate election, which would treat all balance sheet items as marked items and would require that income, gain, loss and deduction with respect to a qualified business unit be translated at a yearly average exchange rate. The proposed regulations also include an annual recognition election, which would trigger all items of income, gain, loss and deduction on an annual basis. Comments and requests for a public hearing must be received by February 12, 2024.

December 11, 2023: The IRS issued Notice 2023-80, which announces the intention to issue proposed regulations that address the application of the foreign tax credit (FTC) and dual consolidated losses in relation to the Global Anti-Base Erosion (GloBE) Model Rules. The notice also (i) extends the temporary relief period described in Notice 2023-55 for determining whether a foreign tax is eligible for an FTC pursuant to §§ 901 and 903 and (ii) addresses application of the temporary relief with respect to partnerships and their partners.

December 11, 2023: The IRS urged taxpayers to take certain important actions to help them file their 2023 federal income tax return for the upcoming filing season, including (i) making quarterly payments by January 16, 2024, if required, (ii) gathering 2023 tax documents, (iii) considering whether to file electronically and choosing direct deposit to expedite tax refunds, and (iv) reviewing energy-related credits. The IRS also reminded taxpayers that they can now view their IRS account transcripts online and should not rely on receiving refunds by a certain date.

December 13, 2023: The IRS announced plans for a new leadership structure at the agency that will feature a single deputy IRS Commissioner and four new IRS chief executive positions to cover taxpayer service, compliance, information technology and operations.

December 13, 2023: The IRS published Tax Tip 2023-126, which states that business taxpayers can electronically file any Form 1099 series information returns for free with the IRS Information Returns Intake System.

December 14, 2023: The US Department of the Treasury and the IRS issued proposed regulations on the § 45X advanced manufacturing production credit. The proposed [...]

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Weekly IRS Roundup November 27 – December 1, 2023

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of November 27, 2023 – December 1, 2023.

November 27, 2023: The IRS released Internal Revenue Bulletin 2023-48, which includes Revenue Procedure 2023-34 and sets forth the annual inflation adjustments for various Internal Revenue Code provisions for tax year 2024. Also included are the tax rate schedules and other tax changes.

November 27, 2023: The IRS and Security Summit partners launched the eighth National Tax Security Awareness Week along with tips for taxpayers and tax professionals to avoid scams and protect sensitive personal information ahead of the upcoming 2024 filing season and throughout the year.

November 27, 2023: The IRS published Tax Tip 2023-124, which reminds taxpayers that the IRS has newsletters for a variety of tax topics and audiences.

November 27, 2023: The IRS published proposed regulations that would amend the rules applicable to plans that include cash or deferred arrangements under § 401(k) to provide guidance for long-term, part-time employees. Comments and requests for a public hearing must be received by January 26, 2024.

November 27, 2023: The IRS published proposed regulations that would update current regulations regarding whether certain persons are treated as related persons who are subject to certain special rules pertaining to transactions with partnerships. The proposed regulations would affect partnerships that enter into transactions with related persons that result in a gain or loss on a sale or exchange of property or result in a difference in the timing recognition of income and deductions on account of the persons’ different methods of accounting. Comments and requests for a public hearing must be received by February 26, 2024.

November 28, 2023: The IRS reminded tax professionals to protect themselves and their clients’ sensitive information, including by putting written security plans in place and by following new requirements to use multifactor authentication.

November 28, 2023: The IRS highlighted its continued support of international efforts to fight fraud and charity scams in light of Charity Fraud Awareness Week.

November 28, 2023: The IRS published Tax Tip 2023-125, which reminds paid tax return preparers to renew their Preparer Tax Identification Number via the online renewal process before it expires on December 31, 2023.

November 29, 2023: The IRS reminded taxpayers that they can get extra protection against identity theft during the 2024 tax season by joining the Identity Protection Personal Identification Number program.

November 30, 2023: The IRS urged businesses to remain vigilant against cyberattacks aimed at stealing their customers’ personal information and other business data.

December 1, 2023: The US Department of the Treasury and the IRS issued two guidances on the § 30D clean vehicle credit excluded entity restriction, as amended by the Inflation Reduction Act [...]

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Tax Court Rules Limited Partners May Be Subject to Self-Employment Tax

On November 28, 2023, the US Tax Court granted partial summary judgment in favor of the Internal Revenue Service (IRS) in Soroban Capital Partners LP v. Commissioner and held that “limited partners” are defined functionally—not by state law—for purposes of Internal Revenue Code (IRC) Section 1402(a)(13), which excludes distributions to a “limited partner, as such” from self-employment tax.

Partners are generally required to include their distributive shares of partnership income in their net earnings from self-employment under IRC Sections 1402(a) and 702(a)(8). IRC Section 1402(a)(13), however, provides an exception. It excludes “the distributive share of any item of income or loss of a limited partner, as such, other than [certain] guaranteed payments” from self-employment tax. However, in the context of IRC Section 1402(a)(13), “limited partner” is not defined. The Tax Court previously held that “limited partners” are determined functionally (e.g., by what they actually do with respect to the partnership), not by their status or title under state law, in the context of a limited liability partnership. (See Renkemeyer v. Commissioner, 136 T.C. 137 (2011).) Soroban argued that in the distinct context of a limited liability partnership, plain statutory meaning, legislative history, past guidance from the US Department of the Treasury (Treasury) and the IRS, and policy considerations all pointed to the same conclusion: “limited partner” for purposes of the self-employment tax must be determined by reference to state law.

The Tax Court disagreed. The Court fixed its attention on the phrase “limited partner, as such” and found that under the canon of construction against surplusage, the words “as such” demonstrate “that the limited partner exception applies only to a limited partner who is functioning as a limited partner.” To the extent legislative history or Soroban’s “myriad other arguments” suggest otherwise, they cannot “overcome the plain meaning of the statute.”

The Tax Court held that IRC Section 1402(a)(13) applies only to “passive investors” and excludes “earnings from a mere investment” only. Therefore, the Court “must examine the functions and roles of the limited partners in the partnership to determine whether their shares of earnings are excluded from net earnings from self-employment.” The Court concluded that it has jurisdiction to complete this task during partnership-level proceedings because the applicability of IRC Section 1402(a)(13) “is a partnership item” under Treasury Regulation § 301.6231(a)(3)-1.

Practice Point: The Court’s holding in Soroban will likely provide the IRS with additional incentive to audit taxpayers as part of the IRS’s Self-Employment Contributions Act compliance campaign, which the IRS placed on hold to see “what develops in” cases like Soroban. This issue has been hotly contested in the Tax Court, with several cases currently being litigated, including Denham Capital Management LP v. Commissioner, Docket. No. 9973-23, and Point72 Asset Management LP v. Commissioner, Docket. No. 12752-23. We will see whether the taxpayer in Soroban seeks review by an appellate court. In the meantime, if you have this issue, we advise consulting with your tax professional to ensure you are poised to [...]

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Weekly IRS Roundup November 20 – November 24, 2023

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of November 20, 2023 – November 24, 2023.

November 20, 2023: The IRS released Internal Revenue Bulletin 2023-47, which includes the following:

  • Announcement 2023-32 announces the Office of Professional Responsibility’s recent disciplinary sanctions on certain lawyers, certified public accountants, enrolled agents, enrolled actuaries, enrolled retirement plan agents, appraisers and unenrolled/unlicensed return preparers.
  • Announcement 2023-33 revokes § 501(c)(3) determinations for certain organizations and stipulates that contributions made to the organizations by individual donors are no longer deductible under § 170(b)(1)(A).
  • Notice 2023-75 provides adjusted 2024 limitations on benefits and contributions under § 415(d) qualified retirement plans.
  • Proposed regulations that address the fees established by the No Surprises Act for the Federal Independent Dispute Resolution process.
  • Proposed regulations that notate the extended commentary period from October 2, 2023, to October 17, 2023, for the proposed rules entitled, “Requirements Related to the Mental Health Parity and Addiction Equity Act,” which were published in the Federal Register on August 3, 2023.

November 21, 2023: The IRS released Notice 2023-74, announcing that the new $600 Form 1099-K reporting threshold requirement for third-party settlement organizations for calendar year 2023 is delayed. The IRS is also planning a threshold of $5,000 for 2024 to phase in implementation. Fact Sheet 2023-27 provides additional details.

November 21, 2023: The IRS released Revenue Procedure 2023-37, which sets forth rules for Qualified Pre-approved Plans and § 403(b) Pre-approved Plans. The rules consolidate and conform prior revenue procedures with respect to the pre-approved plans.

November 22, 2023: The IRS reminded low- and moderate-income taxpayers that they can save for retirement now and potentially earn the Retirement Savings Contributions Credit, also known as the Saver’s Credit, in 2024 and the years ahead.

November 22, 2023: The IRS published proposed regulations that would amend existing regulations related to the energy credit for the taxable year in which eligible energy property is placed in service pursuant to Internal Revenue Code § 48. Comments must be received by January 22, 2024.

November 24, 2023: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).

Special thanks to John Zhang in our New York office for this week’s roundup.




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Weekly IRS Roundup November 13 – November 17, 2023

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of November 13, 2023 – November 17, 2023.

November 13, 2023: The IRS released Internal Revenue Bulletin 2023-46, which includes the following:

  • Proposed regulations that would update the requirements a plan sponsor of a single-employer defined benefit plan must meet to obtain IRS approval to use mortality tables specific to the plan when calculating the present value for minimum funding purposes (as a substitute for the generally applicable mortality tables). Comments and requests for a public hearing must be received by December 19, 2023.
  • Final regulations that prescribe mortality tables for certain defined benefit pension plans.
  • Announcement 2023-31, which revokes § 501(c)(3) determinations for certain organizations and stipulates that contributions made to the organizations by individual donors are no longer deductible under § 170(b)(1)(A).

November 13, 2023: The IRS reminded taxpayers of the important steps they can take now to help them “get ready” to file their 2023 federal tax return for the 2024 filing season.

November 13, 2023: The IRS released FS-2023-26, updating question nine to reflect that wrongfully incarcerated US service members cannot exclude certain payments from gross income.

November 13, 2023: The IRS reminded people to stay vigilant in protecting personal and financial information from scam artists and tax schemes in light of International Fraud Awareness Week.

November 13, 2023: The IRS provided instructions for tax professionals to become an authorized e-file provider, which is mandatory for tax professionals to be able to file their clients’ federal tax returns electronically.

November 14, 2023: The IRS announced that it will hold a free webinar on November 16, 2023, to update employers, tax professionals and others on the most recent developments concerning e-file requirements for information returns that take effect on January 1, 2024.

November 14, 2023: The IRS released Notice 2023-76, which updates the corporate bond monthly yield curve and corresponding spot segment rates for November 2023 used under § 417(e)(3)(D), the 24-month average segment rates for November 2023 and the 30-year Treasury rates, as reflected by the application of § 430(h)(2)(C)(iv).

November 15, 2023: The IRS announced that Rajiv Uppal has been selected as the next Chief Information Officer.

November 15, 2023: The IRS announced that taxpayers can now claim tax credits for new and used clean vehicles they buy during the tax year, and starting January 1, 2024, they can transfer those tax credits to the dealer in exchange for a financial benefit.

November 15, 2023: The IRS released Revenue Ruling 2023-21, which provides various prescribed rates for federal income tax purposes for December 2023.

November 16, 2023: The IRS reminded individual retirement arrangement owners age 70½ or [...]

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Weekly IRS Roundup November 6 – November 10, 2023

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of November 6, 2023 – November 10, 2023.

November 6, 2023: The IRS released Internal Revenue Bulletin 2023-45, which includes the following:

  • Final regulations that increase the user fees for new and renewal enrollment of enrolled actuaries to $680, up from $250.
  • Notice 2023-70 provides that $3.22 is the adjusted applicable dollar amount for determining the Patient-Centered Outcomes Research Trust Fund fee for policy years and plan years ending on or after October 1, 2023, and before October 1, 2024.
  • Notice 2023-72 updates the corporate bond monthly yield curve and the corresponding spot segment rates for October 2023 used under § 417(e)(3)(D), the 24-month average segment rates for October 2023 and the 30-year Treasury rates, as reflected by the application of § 430(h)(2)(C)(iv).
  • Notice 2023-73 specifies a mortality table for determining the minimum present value under § 417(e)(3) of the Internal Revenue Code and Section 205(g)(3) of the Employee Retirement Income Security Act of 1974 for distributions with annuity starting dates that occur during stability periods beginning in the 2024 calendar year.
  • Announcement 2023-30 revokes § 501(c)(3) determination(s) for certain organization(s) and stipulates that contributions made to the organization(s) by individual donors are no longer deductible under § 170(b)(1)(A).
  • Revenue Ruling 2023-20 provides the November 2023 applicable federal rates.

November 6, 2023: The IRS published Tax Tip 2023-120, which notes that volunteers are needed to fill a variety of roles in two IRS volunteer programs.

November 7, 2023: The IRS released FS-2023-25, announcing that taxpayers are now able to digitally submit all correspondence and responses to notices. New updates to the “Where’s My Refund?” tool will launch during the 2024 filing season.

November 7, 2023: The IRS announced that the telephonic-only public hearing on digital asset transactions has been rescheduled for November 13, 2023.

November 8, 2023: The IRS reminded dealers and sellers of clean vehicles to register their organizations immediately via the Energy Credits Online tool. The IRS urges registration by December 1, 2023, to ensure benefits are available by January 1, 2024.

November 9, 2023: The IRS Advisory Council issued its annual report for 2023, which includes recommendations for the IRS regarding new and continuing issues in tax administration.

November 9, 2023: The IRS announced the annual inflation adjustments for more than 60 tax provisions for tax year 2024, including the tax rate schedules and other tax changes. Further annual adjustment details may be found in Revenue Procedure 2023-34.

November 9, 2023: The IRS issued its fiscal year 2023 Financial Report.

November 9, 2023: The IRS published Tax [...]

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Employers Be Forewarned and Forearmed: Recent IRS Announcements Require Action on ERTC Claims

Promoters and tax advisors have extensively marketed the Employee Retention Tax Credit (ERTC) as a way for employers to reclaim Federal Insurance Contributions Act payroll taxes paid during the first two years of COVID-19. The rules governing ERTC claims are complex and nuanced, however, resulting in increased scrutiny by the Internal Revenue Service (IRS). Asserting that many employers have improperly claimed these heavily marketed ERTC refunds, the IRS released two announcements, one on September 14, 2023, and the other on October 19, 2023, that address ERTC claims. In conjunction with these announcements, the IRS has already named fraudulent ERTC claims as number one on its “Dirty Dozen” list for 2023.

Specifically, the IRS will now target erroneous ERTC claims with penalties and interest. If a case is deemed fraudulent, the IRS will investigate and may impose civil and criminal penalties. The IRS has also suspended ERTC refund claims and provided a new withdrawal process for potentially fraudulent claims.




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Weekly IRS Roundup October 30 – November 3, 2023

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of October 30, 2023 – November 3, 2023.

October 30, 2023: The IRS released Internal Revenue Bulletin 2023-44, which includes the following:

  • Proposed regulations that would update the rules governing the IRS’s sale of taxpayer property that was seized by levy.
  • Proposed regulations addressing so-called “Killer B” transactions. These transactions, at a high level, are structured to repatriate foreign subsidiary earnings through triangular reorganizations. The proposed regulations would formalize and modify guidance set forth in Notices 2014-32 and 2016-73.
  • Final regulations that provide rules for prohibitions on certain contributions to Type I and Type III supporting organizations, as well as rules for qualifying as functionally integrated and non-functionally integrated Type III supporting organizations.
  • Notice 2023-71, which extends all tax filing and payment deadlines from October 7, 2023, to October 7, 2024, for taxpayers affected by the recent terrorist attacks in Israel.

October 30, 2023: The IRS extended its policy for accepting digital signatures for certain tax forms until October 31, 2025. The IRS updated the Internal Revenue Manual to be consistent with this extension.

October 31, 2023: The IRS reminded taxpayers to remain vigilant against potential online threats and highlighted certain practices to help protect against cybersecurity attacks.

November 1, 2023: The IRS announced that clean vehicle sellers can now register for time-of-sale reporting and dealer advance payments for the clean vehicle credit using the new Energy Credits Online tool.

November 1, 2023: The IRS announced that the amount individuals can contribute to their 401(k) plans in 2024 has increased to $23,000, up from $22,500 in 2023. Notice 2023-75, which was released the same day, provides adjusted 2024 limitations on benefits and contributions under qualified retirement plans as under § 415(d).

November 2, 2023: The IRS rescheduled the hearing on proposed regulations regarding digital asset transactions from November 7, 2023, to November 13, 2023.

November 2, 2023: The IRS published Tax Tip 2023-119, which notes that individuals may now review 18 new Nationwide Tax Forums Online seminars.

November 3, 2023: The IRS reminded taxpayers to review their tax withholding obligations ahead of the upcoming tax filing season to avoid having a large refund or balance due.

November 3, 2023: The IRS issued proposed regulations that would add new requirements relating to the disclosure of information that group health plans and health insurance issuers must include subject to the No Surprises Act. The proposed regulations consider requiring plans and issuers to register via the Federal IDR portal. Comments must be received by January 2, 2024.

November 3, 2023: The IRS released its weekly list [...]

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