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Weekly IRS Roundup August 24 – August 28, 2020

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of August 24, 2020 – August 28, 2020. Additionally, for continuing updates on the tax impact of COVID-19, please visit our resource page here.

August 24 2020: The IRS published a memorandum concerning guidance to the field on the criteria that should be applied in considering if a request for designation for litigation should be made to the Office of Chief Counsel. The memorandum also provides interim guidance on the requirements of Section 1001 of the Taxpayer First Act (TFA) with respect to the limitation on designation of cases as not eligible for referral to the IRS Independent Office of Appeals.

August 25, 2020: The IRS published a Summer 2020 Statistics of Income Bulletin. The Summer 2020 Bulletin focuses individual income tax shares, 2017; foreign recipients of US income, calendar year 2017; effects of post-filing adjustments on Statistics of Income (SOI) estimates; and implementation of the Tax Cuts and Jobs Act.

August 25, 2020: The IRS published a practice unit focusing on the definition of foreign earned income for purposes of section 911.

August 26, 2020: The IRS published a notice and request for comments on Treasury Decision 8702 concerning certain transfers of domestic stock or securities by US persons to foreign corporations. The regulation relates to certain transfers of stock or securities of domestic corporations pursuant to the corporate organization, reorganization or liquidation provisions of the Internal Revenue Code (Code). Transfers of stock or securities by US persons in tax-free transactions are treated as taxable transactions when the acquirer is a foreign corporation, unless an exception applies under section 367(a). The regulation provides that no US person will qualify for an exception unless the US target company complies with certain reporting requirements. The comments should be received on or before October 26, 2020.

August 26, 2020: The IRS published a notice and request for comments on Treasury Decision 8612 concerning the availability of the gift and estate tax marital deduction when the donee spouse or the surviving spouse is not a US citizen. The regulation provides guidance to individuals or fiduciaries: (1) for making a qualified domestic trust election on the estate tax return of a decedent whose surviving spouse is not a US citizen in order that the estate may obtain the marital deduction; and (2) for filing the annual returns that such an election may require. The comments should be received on or before October 26, 2020.

August 27, 2020: The IRS published an announcement on the opening of the application period for the 2021 Compliance Assurance Process program. The application period runs September 1 to November 13, 2020. The IRS will inform applicants if they’re accepted into the program in February 2021.

August 28, 2020: The IRS published
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Weekly IRS Roundup February 24 – 28, 2020

Presented below is our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of February 24 – 28, 2020.

February 24, 2020: The IRS released final instructions to Form 8978, Partner’s Additional Reporting Year Tax, to reflect changes to the audit procedures of partnerships under the 2015 BBA. Under IRC section 6226, a partnership may elect to have each reviewed year partner take into account the partner’s share of the partnership’s adjustments, instead of the partnership paying the imputed underpayment determined under Section 6221.

February 24, 2020: The IRS issued a news release naming Brendan O’Dell, a senior advisor in the IRS LB&I Division, as the IRS’ new Promoter Investigations Coordinator. O’Dell will coordinate promoter activity across the agency, working with the IRS business units, the Office of Professional Responsibility, Criminal Investigation, Chief Counsel and other IRS offices to ensure coordination of ongoing investigations and the development of new approaches to identify promoters of aggressive tax arrangements.

February 27, 2020: The IRS issued final regulations that correct TD 9885, the base erosion and anti-abuse regulations that were published on December 6, 2019. The corrections clarify two-timing thresholds, stating that the final regulations extend the transition period for meeting the complete QDP reporting requirements until taxable years beginning on or after Monday, June 7, 2021 and that Section 1.6038A-2(b)(7)(ix) applies to taxable years beginning on or after Monday, June 7, 2021.

February 27, 2020: The IRS updated Publication 590-A, which addresses contributions to individual retirement arrangements (IRAs) under IRC section 408A. The IRS provided the correct procedure to determine modified adjusted gross income for Roth IRA purposes.

February 27, 2020: The Treasury and the IRS announced the appointment of Erin M. Collins as the new National Taxpayer Advocate. For our separate discussion of the appointment, as well as other recent tax appointments, see here.

February 28, 2020: The Statistics of Income (SOI) Division of the IRS released the SOI Bulletin for winter 2020. The bulletin focuses on individual foreign-earned income and the foreign tax credit for the 2016 tax year, when the total amount of foreign-earned income reported by US taxpayers decreased by 11.2% from 2011, while the foreign-source gross income reported by US taxpayers during that time increased by 19.5%. The SOI Bulletin provides the most recent data available from various tax and information returns filed by US taxpayers.

February 28, 2020: The IRS released a revenue ruling and a related news release announcing that interest rates under IRC section 6621 will remain the same for the calendar quarter beginning April 1, 2020. IRC section 6621 establishes the interest rates on overpayments and underpayments of tax, including a specific rate for large corporate underpayments. The revenue ruling will appear in the Internal Revenue Bulletin 2020-12, dated March 16, 2020.

February 28, 2020: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).

Special thanks to Jenni [...]

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