qualifying payment amounts Archives

Weekly IRS Roundup December 18 – December 22, 2023

by Evan Walters | Dec 26, 2023 | IRS Guidance, Tax Reform

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of December 18, 2023 – December 22, 2023.

December 18, 2023: The IRS released Internal Revenue Bulletin 2023-51, which includes the following:

Notice 2023-74, which delays the new $600 Form 1099-K reporting threshold requirement for third-party settlement organizations for calendar year 2023 and plans to phase in the reporting requirement in 2024, starting with a threshold of $5,000.
Revenue Procedure 2023-40, which provides guidance in specific circumstances on the adequacy of disclosure on a federal tax return for purposes of reducing the understatement of income tax accuracy-related penalty pursuant to § 6662(d) of the Internal Revenue Code (Code) and avoiding the Code § 6694(a) tax return preparer penalty.
Proposed regulations that would amend the rules applicable to plans that include cash or deferred arrangements pursuant to § 401(k) to provide guidance with respect to long-term, part-time employees. Comments must be received by January 26, 2024. A public hearing is scheduled for March 15, 2024, at 10 am EDT.
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.
Revenue Procedure 2023-38, which provides procedural rules for qualified manufacturers of new clean vehicles to comply with the reporting, certification and attestation requirements regarding the excluded entity restriction.
Revenue Ruling 2023-23, which publishes the base period T-bill rate for the period ending September 30, 2023, under § 995(f).
Revenue Procedure 2023-36, which updates the list of jurisdictions with which the United States has in effect a relevant information exchange agreement or an automatic exchange relationship under Treasury Regulation § 1.6049-4(b)(5) and Treasury Regulation § 1.6049-8(a).

December 18, 2023: The IRS announced the launch of the second phase of a new online self-service tool for businesses that expands the business tax account capabilities and eligible entity types. Individual partners of partnerships and individual shareholders of S Corporation businesses are also now eligible for a business tax account.

December 18, 2023: The IRS issued Revenue Ruling 2024-1, which provides tables of covered compensation under § 401(l)(5)(E) for the 2024 plan year.

December 19, 2023: The IRS announced new penalty relief for certain individuals, businesses and tax-exempt organizations that were not sent automated collection reminder notices during the pandemic. Notice 2024-7 and Fact Sheet 2023-28 provide additional details.

December 19, 2023: The IRS issued Notice 2024-1, which provides the percentage increase for calculating the qualifying payment amounts for items and services furnished during 2024 for purposes of § 9816 and § 9817 of the Code, section 716 and section 717 of the Employee Retirement Income Security Act of [...]

Continue Reading

Weekly IRS Roundup January 9 – January 13, 2023

by McDermott Will & Emery | Jan 17, 2023 | IRS Guidance, Tax Reform, Tax Refunds

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of January 9, 2023 – January 13, 2023.

January 9, 2023: The IRS released Internal Revenue Bulletin 2023-2, which highlights the following:

Announcement 2023-2: This announcement provides transitional guidance with respect to the reporting of information on digital assets. Specifically, brokers are not required to report additional information on the disposition of digital assets until final regulations under Sections 6045 and 6045A are issued.

Notice 2023-8: This notice provides guidance for brokers to comply with the provisions of the final regulations under Section 1446(f) and certain provisions of the final regulations that apply to Section 1446(a) that relate to withholding on the transfer of an interest in a publicly traded partnership.

Revenue Rule 2023-1: This revenue ruling provides the applicable federal rates for federal income tax purposes for January 2023. The short-term federal interest rate will decrease to 4.50%, the mid-term rate will drop to 3.85% and the long-term rate will fall to 3.84%.

Treasury Decision 9970: This document includes final regulations that provide an automatic extension for providers of minimum essential coverage (including health insurance issuers, self-insured employers and government agencies) to furnish individual statements regarding such coverage and an alternative method for furnishing individual statements when the individual shared responsibility payment amount is zero. The final regulations also provide an automatic extension for applicable large employers to furnish statements relating to health insurance that they offer to their full-time employees.

Notice 2023-5: This notice provides updates on the corporate bond monthly yield curve, the corresponding spot segment rates and the 24-month average segment rates under Section 430(h)(2). This notice also provides guidance on the interest rate for 30-year Treasury securities as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate.

Notice 2023-4: This notice provides the percentage increase for calculating the qualifying payment amounts for items and services furnished during 2023 with respect to Sections 9816 and 9817 of the Internal Revenue Code, Sections 716 and 717 of the Employee Retirement Income Security Act of 1974 and Sections 2799A-1 and 2799A-2 of the Public Health Service Act.

Notice 2023-06: This notice explains the requirements for fuel to be eligible for the sustainable aviation fuel (SAF) credit, how to claim the credit and who must be registered. The SAF credit was created by the Inflation Reduction Act of 2022 and applies to a qualified fuel mixture containing SAF for certain uses or sales in the 2023 and 2024 calendar years.

January 9, 2023: The IRS released Tax Tip 2023-02, advising people to hang up if scammers call during tax season. The IRS says it will never (1) call to demand immediate payment using [...]

Continue Reading

Weekly IRS Roundup December 19 – December 23, 2022

by McDermott Will & Emery | Dec 27, 2022 | IRS Guidance, Tax Reform, Tax Refunds

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of December 19, 2022 – December 23, 2022.

December 19, 2022: The IRS released Internal Revenue Bulletin 2022-51, which highlights the following:

Revenue Ruling 2022-23: This revenue ruling announces the interest rates for the first quarter of 2023. The new interest rates are as follows:
- Overpayments: 7%
- Overpayments for corporations: 6%
- Corporate overpayments for portion exceeding $10,000: 4.5%
- Underpayments: 7%
- Large corporate underpayments: 9%

Announcement 2022-26: This announcement notifies taxpayers that payments made to property owners under Suffolk County’s Septic Improvement Program are not required to be included in gross income for federal income tax purposes.

Revenue Ruling 2022-24: This revenue ruling provides tables for covered compensation related to qualified pension, profit-sharing and stock bonus plans under Section 401(l)(5)(E) and related income tax regulations for the 2023 plan year. The taxable wage base is $160,200 for the 2023 tax year (up from $147,000 in 2022) for purposes of determining covered compensation.

Announcement 2022-24: This announcement lists the organizations that no longer qualify for 501(c)(3) and 170(c)(2) status.

Announcement 2022-25: This announcement notifies potential donors of a stipulated decision by the US Tax Court in declaratory judgment proceedings under Section 7428.

Announcement 2022-27: This announcement reminds state and local housing credit agencies of the deadline related to certain allocation of housing credit dollar amounts under Section 42.

December 19, 2022: The IRS and the US Department of the Treasury (Treasury) issued guidance related to the Sustainable Aviation Fuel (SAF) credit. Notice 2023-06 explains the requirements for the fuel to be eligible for the SAF credit, how to claim the credit and who must be registered. The SAF credit was introduced in the Inflation Reduction Act of 2022 (IRA) and applies to a qualified fuel mixture containing sustainable aviation fuel for certain uses or sales in the 2023 and 2024 calendar years.

December 19, 2022: The Treasury announced a timeline for providing additional information on key tax provisions for the IRA. Before the end of the year, the Treasury will provide: (1) FAQs on the tax credit for energy-efficient home improvement projects and residential energy property; (2) initial guidance on the corporate alternative minimum tax; and (3) initial guidance on the excise tax on stock buybacks. Beginning January 1, 2023, consumers and businesses will be able to access tax benefits from many of the IRA’s climate provisions.

December 20, 2022: The IRS issued Notice 2023-4, which provides the percentage increase for calculating the qualifying payment amounts for items and services furnished during 2023 with respect to Sections 9816 and 9817 of the Internal Revenue Code, Sections 716 and 717 of the Employee Retirement Income Security [...]

Continue Reading