IRS News

Issue Number:  2017-17

Inside This Issue

1.     2017 Nationwide Tax Forum Seminar Topics Now Available

2.     IRS Receives Millions of Tax Returns in Last Days of Tax Filing Season

3.     IRS Promotes Specialized Online Services during Small Business Week

4.     May 3 Webinar: Working with the IRS Office of Appeals – What to Expect

5.     YouTube: Private Firms to Collect Overdue Taxes

6.     Avoid Duplicate Freedom of Information Act Requests

7.     Technical Guidance

 

1.  2017 Nationwide Tax Forum Seminar Topics Now Available

Plan your visit now to the 2017 IRS Nationwide Tax Forums in five cities around the country this summer: seminar topics are now available online. A total of 38 seminars and workshops are on the agenda. The first Forum this summer is in Orlando July 11-13, followed by Dallas, National Harbor/Washington, D.C., Las Vegas and San Diego. Register by May 31 for an early bird rate of $235.

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2.  IRS Receives Millions of Tax Returns in Last Days of Tax Filing Season

The Internal Revenue Service has received 135.6 million returns so far this year following a late surge of filings last week.

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3.  IRS Promotes Specialized Online Services during Small Business Week

National Small Business Week is April 30 through May 6. The Internal Revenue Service has numerous many tools and products to help small business owners and the self-employed understand their tax responsibilities.

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4.  May 3 Webinar: Working with the IRS Office of Appeals – What to Expect

Want to know more about the IRS appeals process? This May 3 webinar will present information that practitioners should know when working with the Office of Appeals.

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5.  YouTube: Private Firms to Collect Overdue Taxes

Know what to do if a private collection company contacts you or your client on behalf of the IRS. A new IRS YouTube video explains how to confirm that the company is legitimate.

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6.  Avoid Duplicate Freedom of Information Act Requests

To avoid delays on Freedom of Information Act (FOIA) requests, send only one request to the IRS office most likely to have the records. Sending the same request to multiple mailing addresses or fax numbers will increase processing time. Mail or fax your request to the most appropriate location, based on the information you are requesting.

Before you submit a FOIA request, determine whether the information is available through routine agency procedures, which can make access quicker and easier. If you need to request information under FOIA, see the IRS FOIA Guidelines for information and instructions.

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7.  Technical Guidance

Notice 2017-29 extends the due date for participants filing disclosures under Notice 2017-10 (relating to syndicated conservation easement transactions) and clarifies that for purposes of Notice 2017-10, a donee described in section 170(c) is not a material advisor.

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Issue Number:  2017-16

Inside This Issue

1.     Is that Really the IRS at Your Door?

2.     IRS Seeks Applications for Information Reporting Program Advisory Committee

3.     More ITIN Service Options Available to International Taxpayers

4.     April 26 Webinar: IRS Announces 4th in Series of Webinars on LB&I Compliance Campaigns

5.     YouTube: When Will I Get My Refund?

6.     Achieve Your Goal of Becoming an Enrolled Agent

7.     Technical Guidance

 

1.  Is that Really the IRS at Your Door?

The Internal Revenue Service has tips on IRS.gov to help tax pros and taxpayers determine if a person visiting their home or place of business is legitimate or an imposter.

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2.  IRS Seeks Applications for Information Reporting Program Advisory Committee

The Internal Revenue Service is requesting membership nominations for the Information Reporting Program Advisory Committee (IRPAC), a federal advisory committee that provides recommendations to the IRS on various tax administration issues.

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3.  More ITIN Service Options Available to International Taxpayers

The IRS has expanded the options available to taxpayers residing abroad who need an ITIN to fulfill their U.S. filing requirement.  In addition to the current options of mailing the completed Form W-7, Application for Individual Taxpayer Identification, and required identification documents to the IRS or visiting an IRS Taxpayer Assistance Center in the United States, taxpayers can now visit a U.S.-based Certified Acceptance Agent (CAA) or a CAA located abroad. More information on the ITIN program can be found on IRS.gov/ITIN.

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4.  April 26 Webinar: IRS Announces 4th in Series of Webinars on LB&I Compliance Campaigns

The IRS Large Business and International (LB&I) Division will participate in the fourth in a series of webinars on April 26 to provide tax practitioners with additional information about how its new compliance campaigns will operate.

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5.  YouTube: When Will I Get My Refund?

Find out when your clients can expect their refunds in this YouTube video.

Watch this and other videos on the IRS YouTube Channel .

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6.  Achieve Your Goal of Becoming an Enrolled Agent

Thinking of becoming an enrolled agent? Earning the enrolled agent credential places you squarely among an elite group of tax professionals. The IRS has created new sample test questions and answers to help you prepare for the Special Enrollment Exam (SEE). These sample questions provide test candidates with an understanding of the type of questions they may encounter on the SEE.

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7.  Technical Guidance

Revenue Ruling 2017-11 provides various prescribed rates for federal income tax purposes including the applicable federal interest rates, the adjusted applicable federal interest rates, the adjusted federal long-term rate, the adjusted federal long-term tax-exempt rate. These rates are determined as prescribed by section 1274. 

Revenue Procedure 2017-30 provides the list of Automatic Changes to which the automatic change procedures in Rev. Proc. 2015-13, 2015-5 I.R.B. 419, as clarified and modified by Rev. Proc. 2015-33, 2015-24 I.R.B. 1067, and as modified by Rev. Proc. 2016-1, 2016-1 I.R.B. 1, (or successor) apply.

Revenue Procedure 2017-33 provides guidance under the Protecting Americans for Tax Hikes Act of 2015 (PATH Act) regarding amendment to (i) expensing section 179 property, (ii) the additional first year depreciation deduction under section 168(k), and (iii) the qualified Indian reservation property depreciation provision under section 168(j). 

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Issue Number:  2017-9

Inside This Issue

1.     IRS Nationwide Tax Forums Open for Registration

2.     Refunds Totaling $1 Billion Available for Those Who Have Not Filed a 2013 Tax Return

3.     Special Enrollment Exam Fee

4.     LB&I Compliance Campaign Webinars

5.     Online Resources for IP PIN and Transcripts

6.     YouTube: IRS Taxes-Three Easy Ways to Pay

7.     IRS Criminal Investigation Releases Fiscal Year 2016 Annual Report

8.     IRS Reaches 100th eBook Milestone

9.     Technical Guidance

 

1.  IRS Nationwide Tax Forums Open for Registration

The 2017 IRS Nationwide Tax Forums are now open for registration. Join tax professionals at five locations across the country for three days of continuing education, workshops and exhibits of new products and services.

 

As a tax professional you can earn up to 18 CPE credits, network with your peers and learn from subject matter experts from the IRS and its association partners.

 

For more information or to register, visit the IRS Nationwide Tax Forum website at www.irstaxforum.com.

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2.  Refunds Totaling $1 Billion Available for Those Who Have Not Filed a 2013 Tax Return

Unclaimed federal income tax refunds totaling more than $1 billion may be waiting for an estimated one million taxpayers who did not file a 2013 federal income tax return.

To claim this money, taxpayers must file a 2013 tax return with the IRS no later than April 18.

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3.  Special Enrollment Exam Fee

Effective March 1, the fee for taking each of the three parts of the Special Enrollment Examination increased from $109 to $111.94. The increase is due to a change to the vendor’s portion of the fee by $2.94. The IRS portion of the fee is unchanged.

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4.  LB&I Compliance Campaign Webinars

The IRS Large Business and International (LB&I) Division will participate in a series of webinars in collaboration with various stakeholders to provide tax practitioners with information about its new compliance campaigns.

KPMG will host the first in the series, scheduled for March 7, at 2 p.m. EST. This 75-minute webinar will focus on the campaign process, how campaigns are being implemented and how they will impact taxpayers.

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5.  Online Resources for IP PIN and Transcripts

At this time of the year, some of your clients are seeking their Identity Protection PINs or are in need of a tax transcript. For inquiries about IP PIN and transcripts, guide them to the most appropriate service options on IRS.gov:   

Identity Protection PIN (IP PIN) - If your client lost a CP01A letter and needs an IP PIN, he or she can go to Get an IP PIN or Retrieve Your IP PIN on IRS.gov for retrieval options. Users must validate their identities. If unable to validate, your client should call the Identity Theft toll-free line to have the information mailed. If your client moved after Jan. 1, 2017, he or she will need to file a paper return without an IP PIN.

Tax Transcripts - If your client needs a tax transcript, suggest www.IRS.gov/transcript. The IRS Get Transcript tool allows taxpayers who can validate their identities to view and download transcripts. Alternatively, transcripts can be sent by mail in five to 10 days. Taxpayers may also order a transcript by mail by calling the automated phone transcript service at 800-908-9946. Tax professionals with a power of attorney form on file also may access their clients’ transcripts via e-Services.

Reminder: All Taxpayer Assistance Centers (TACs) nationwide now operate by appointment. Most questions can be answered online at IRS.gov without visiting a TAC. Taxpayers who need in-person assistance can make an appointment online.

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6.  YouTube: IRS Taxes-Three Easy Ways to Pay

Learn about all the payment options available to taxpayers in this new YouTube video.

Watch this and other videos on the IRS’s YouTube Channel

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7.  IRS Criminal Investigation Releases Fiscal Year 2016 Annual Report

The IRS Criminal Investigation Division this week released its annual report, assessing criminal enforcement actions taken in fiscal year 2016.

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8.  IRS Reaches 100th eBook Milestone

The IRS recently published its 100th eBook, a key milestone in an effort to share information in ways that meet the changing needs of taxpayers.

IRS eBooks enable you to read and review some of the most commonly used IRS tax products. You can view the 1040 instructions, Publication 17, and other popular tax publications using a mobile device such as a smart phone, tablet or eReader.

The complete list of eBook publications is available at https://www.irs.gov/forms-pubs/ebooks. Tax publications are also available on IRS.gov for free downloading in PDF and HTML versions.

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9.  Technical Guidance

Notice 2017-20 extends the period for an employer that provides a qualified small employer health reimbursement arrangement (QSEHRA), which was added to the Internal Revenue Code by the 21^st Century Cures Act (Cures Act), to furnish an initial written notice to its eligible employees regarding the QESHRA. The period is extended from March 13, 2017 (90 days after the Cures Act was enacted) to at least 90 days after additional guidance regarding the contents of the QSEHRA notice is issued. The notice also provides transition relief from penalties for failure to furnish the written notice until after further guidance has been issued.

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Issue Number:  2017-8

Inside This Issue

1.     Reminder: IRS.gov Tools Available to Answer Tax Questions

2.     Security Summit Reminder: Dangerous W-2 Phishing Scam Evolving: Targets Schools, Restaurants, Hospitals, Tribal Groups

3.     March 1 Tax Deadline Nears for Farmers and Fishermen

4.     Reminders for International Taxpayers and Withholding Agents

5.     Approved Form 1023-EZ Data Available Online

6.     Webinar: Working with the IRS Office of Appeals

7.     YouTube: IRA/Retirement Plan 60-Day Rollover Waivers

 

1.  Reminder: IRS.gov Tools Available to Answer Tax Questions

With high call volumes expected in the last days of February, online tools and resources are available on IRS.gov.

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2.  Security Summit Reminder: Dangerous W-2 Phishing Scam Evolving: Targets Schools, Restaurants, Hospitals, Tribal Groups

Help spread the word to your clients: The Internal Revenue Service, state tax agencies and the tax industry recently issued an urgent alert to all employers that the Form W-2 email phishing scam has evolved beyond the corporate world and is spreading to other sectors, including school districts, tribal organizations and nonprofits. The Summit partners continue to receive reports of this scheme.

For information on how to guard against identity theft, visit Protect Your Clients, Protect Yourself.

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3.  March 1 Tax Deadline Nears for Farmers and Fishermen

March 1 is the deadline for farmers and fishermen to take advantage of special rules that permit them to avoid quarterly estimated tax payments.

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4.  Reminders for International Taxpayers and Withholding Agents

The IRS reminds non-U.S. citizens -- such as international students and scholars working or receiving scholarship funds -- that they may be subject to tax return filing requirements. The IRS also reminds withholding agents that errors on forms or returns could result in refund delays for their clients. Accurately filing Form 1042-S helps speed refunds to taxpayers who are not U.S. citizens.

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5.  Approved Form 1023-EZ Data Available Online

Publicly available information from approved applications for tax exemption using Form 1023-EZ, Streamlined Application for Recognition of Exemption, is now available electronically for the first time.

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6.  Webinar: Working with the IRS Office of Appeals

Register here to watch “Working with the IRS Office of Appeals -- What to Expect,” a free 90-minute webinar, on March 15 at 2:00 p.m. EST. Topics include information on the role of Appeals, an overview of Appeals policies and procedures, and an outline of case procedures for examination and collection cases.

Certificates of completion are being offered. Earn one continuing education credit in Federal Tax.

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7.  YouTube: IRA/Retirement Plan 60-Day Rollover Waivers

If your client misses the deadline through no fault of his or her own, you can still roll over an IRA or retirement plan. This IRS YouTube video explains how.

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Issue Number:  2017-7

Inside This Issue

1.     Avoid the Rush: Online Options Help You Avoid Presidents Day Rush

2.     Security Summit Alert: New Scam Aims to “Unlock” Tax Pro Software Accounts

3.     ACA Silent Returns and the Current Tax Filing Season

4.     Don’t Fall Prey to the Dirty Dozen

5.     Protect Your Clients, Protect Yourself

 

1.  Avoid the Rush: Online Options Help You Avoid Presidents Day Rush

The Presidents Day holiday period marks the peak demand for IRS toll-free telephone and office services. The IRS receives thousands of telephone calls per hour. But the vast majority of people calling or seeking appointments at Taxpayer Assistance Centers can find their answers faster on IRS.gov. Here are some ways to avoid the rush.

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2.  Security Summit Alert: New Scam Aims to “Unlock” Tax Pro Software Accounts

The Internal Revenue Service, state tax agencies and the tax industry today warned tax professionals to be alert to a new phishing email scam impersonating software providers.

The scam email comes with the subject line, “Access Locked.” It tells recipients that access to their tax prep software accounts has been “suspended due to errors in your security details.” The scam email asks the tax professional to address the issue by using an “unlock” link provided in the email.

 

However, the link will take the tax professional to a fake web page, where they are asked to enter their user name and password. Instead of unlocking accounts, the tax professionals actually are inadvertently providing their information to cybercriminals who use the stolen credentials to access the preparers’ accounts and to steal client information.

 

The Security Summit partners remind tax professionals to never open a link or an attachment from a suspicious email. These scams can increase during the tax season.

 

For tax professionals who receive emails purportedly from their tax software providers suggesting their accounts have been suspended, they should send those scam emails to their tax software provider. For Windows users, please this process to help the investigation of these scam emails:

 

1.     Use “Save As” to save the scam. Under “save as type” in the drop down menu, select “plain text” and save to your desk top. Do not click on any links

2.     Open a new email and attach this saved email as a file

3.     Send your new email containing the attachment your tax software provider, as well as copy Phishing@IRS.gov.

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3.  ACA Silent Returns and the Current Tax Filing Season

A recent executive order directed federal agencies to exercise authority and discretion available to them to reduce potential burden regarding the Affordable Care Act.‎ Consistent with that, the IRS has decided to make changes that will continue to allow electronic and paper 1040 returns to be accepted for processing in instances where a taxpayer doesn’t indicate their health insurance coverage status. However, legislative provisions of the ACA law are still in force until changed by Congress, and taxpayers remain required to follow the law and pay what they may owe‎. Keep up-to-date on the latest ACA news by visiting our ACA Information Center for Tax Professionals page.

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4.  IRS Summarizes "Dirty Dozen" List of Tax Scams for 2017

The Internal Revenue Service this week concluded its annual "Dirty Dozen" list of tax scams. The annual list highlights various schemes that taxpayers may encounter throughout the year, many of which peak during tax-filing season. Taxpayers need to guard against ploys to steal their personal information, scam them out of money or talk them into engaging in questionable behavior with their taxes.

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5.  Protect Your Clients, Protect Yourself

Tax practitioners who missed the IRS webinar, “Protect your Clients, Protect Yourself from Data Theft,” can now view it anytime on demand. In the broadcast, IRS and private sector experts discuss client data safeguards, legal requirements and best practices involving the handling of taxpayer data and tips for responding to a loss of taxpayer data.

Visit the Protect Your Clients, Protect Yourself page on IRS.gov for more information on identity theft scams targeting the tax professional community. The page includes links to publications such as Safeguarding Taxpayer Data, security alerts and educational videos.

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Issue Number:  2017-4

Inside This Issue

1.     EITC Awareness Day: Workers May Qualify for Significant Tax Benefit

2.     Some Tax Professionals to Receive EITC Letters

3.     Form W-2 Scam Targets Payroll, Human Resource Departments

4.     Has Your PTIN Expired?

5.     YouTube: Claiming EITC or ACTC? Refunds May Be Delayed 

6.     Jan. 30 FTC Webinar: Tax Professionals on the Ramparts

7.     IRS Launches Qualified Intermediary, Foreign Withholding Application and Account Management System

 

1.  EITC Awareness Day: Workers May Qualify for Significant Tax Benefit

The Internal Revenue Service joined partners across the country today, EITC Awareness Day, to promote the Earned Income Tax Credit. This campaign, an annual event for the last 11 years, is a nationwide effort to alert millions of low- and moderate-income workers who may otherwise miss out on this significant tax credit.

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2.  Some Tax Professionals to Receive EITC Letters

The IRS is sending Letter 5025-H to tax preparers who completed returns claiming the Earned Income Tax Credit for taxpayers reporting income they received as household employees but without a Form W-2 to substantiate the income. These preparers may not have met their EITC due diligence requirements. Learn more about this letter and other due diligence information by visiting the EITC Central page on IRS.gov.

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3.  Form W-2 Scam Targets Payroll, Human Resource Departments

The Internal Revenue Service, state tax agencies and the tax industry this week renewed their warning about an email scam in which the scammer poses as a corporate officer to request employee Forms W-2 from company payroll or human resource departments.

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4.  Has Your PTIN Expired?

With the start of filing season, the IRS this week sent PTIN (preparer tax identification number) expiration notices to approximately 160,000 PTIN holders. Anyone who prepares or assists in preparing federal tax returns for compensation must have a valid 2017 PTIN. If you need to renew your PTIN, visit IRS.gov for more information.

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5.  YouTube: Claiming EITC or ACTC? Refunds May Be Delayed 

If your clients file early and claim the Earned Income Tax Credit or the Additional Child Tax Credit, find out when they can expect their refunds in this new YouTube video.

Read more about refund timing for early EITC/ACTC filers on IRS.gov.

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6.  Jan. 30 FTC Webinar: Tax Professionals on the Ramparts

The Federal Trade Commission, Internal Revenue Service and the National Association of Tax Professionals are offering a free webinar Jan. 30 with practical guidance about identity theft issues important to tax professionals. Topics include scams targeting tax professionals, cybersecurity, protecting client data and how tax professionals can help identity theft victims.

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7.  IRS Launches Qualified Intermediary, Foreign Withholding Application and Account Management System

The Internal Revenue Service has launched a new application and account management system for certain withholding entities that enter into agreements with the U.S.

The Qualified Intermediary (QI), Withholding Foreign Partnership (WP) and Withholding Foreign Trust (WT) Application and Account Management System automates the Financial Intermediary Program. The system is a secure web-based platform for users to apply to become a QI, WP, or WT, renew or terminate an existing agreement, and manage their information online.

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Issue Number:  2017-3

Inside This Issue

1.     Participate in Form W-2 Testing

2.     YouTube: Choose a Tax Preparer Wisely

3.     Protect Your Clients, Protect Yourself

4.     Technical Guidance

 

1.  Participate in Form W-2 Testing

The IRS and payroll firms are adding a “verification code” this filing season to 50 million Forms W-2. This is part of a test to fight fraud and protect businesses and taxpayers from identity theft. As a tax preparer, you can help by looking for the code and entering the 16 digits when prompted. This is for electronic returns only. Learn more.

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2.  YouTube: Choose a Tax Preparer Wisely

The IRS has a YouTube video, ”Choose a Tax Preparer Wisely,” that tax practitioners can share with prospective clients.

Watch this and other videos on the IRS’s YouTube Channel.

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3.  Protect Your Clients, Protect Yourself

Tax practitioners who missed the IRS webinar, “Protect your Clients, Protect Yourself from Data Theft,” can now view it anytime on demand. In the broadcast, IRS and private sector experts discuss client data safeguards, legal requirements and best practices involving the handling of taxpayer data and tips for responding to a loss of taxpayer data.

Visit the Protect Your Clients, Protect Yourself page on IRS.gov for more information on identity theft scams targeting the tax professional community. The page includes links to publications such as Safeguarding Taxpayer Data, security alerts and educational videos.

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4.  Technical Guidance

Revenue Procedure 2017-22 provides a safe harbor under section 118(a) of the Code for certain amounts received by corporate taxpayers under certain Department of Transportation programs.  Rev. Proc. 2010-46 is clarified.

Revenue Ruling 2017-03  updates, for certain insurance contracts issued in 2016 and 2017, the prevailing state assumed interest rates that life insurance companies need in order to compute their life insurance reserves for federal tax purposes.

Revenue Ruling 2017-04 provides various prescribed rates for federal income tax purposes including the applicable federal interest rates, the adjusted applicable federal interest rates, the adjusted federal long-term rate, the adjusted federal long-term tax-exempt rate. These rates are determined as prescribed by section 1274. 

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Issue Number:  2017-2

Inside This Issue

 

1.     Security Summit Alert: New Two-Stage Email Scheme Targets Tax Professionals

2.     IRS e-Services Reminder: Time Is Running Out to Revalidate

3.     National Taxpayer Advocate 2016 Annual Report to Congress Online

4.     W-2 Employer Information Reporting Changes

5.     IRS Whistleblower Office Awarded More Than $61 Million Last Fiscal Year

6.     EITC Awareness Day Is Friday Jan. 27

7.     Want to file Forms 941 instead of Form 944?

 

1.  Security Summit Alert: New Two-Stage Email Scheme Targets Tax Professionals

The Internal Revenue Service and its Security Summit partners are warning tax pros to be on the alert for a new email scam, in which cybercriminals are posing as potential clients. The scammers are targeting accounting and tax preparation firms nationwide, seeking taxpayer information they can use to file fraudulent tax returns.

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2.  IRS e-Services Reminder: Time Is Running Out to Revalidate

Time is running out to revalidate your identity if you received Letter 5903. Revalidate your account either online or by telephone. The IRS has extended Help Desk hours on weekdays, Saturday and on the Martin Luther King Holiday. Find more information on IRS.gov.

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3.  National Taxpayer Advocate 2016 Annual Report to Congress Online

National Taxpayer Advocate Nina E. Olson released her 2016 Annual Report to Congress, recommending the IRS revamp its “Future State” plan to adopt a taxpayer-centric focus and urging Congress to simplify the tax code. The report presents a series of proposals to improve tax administration, emphasizing changing the culture of the IRS from one that is enforcement-oriented to one that is service-oriented.

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4.  W-2 Employer Information Reporting Changes

Effective last summer, Treasury Directive 9730 removed the automatic extension of time to file information returns on forms in the W-2 series (except Form W-2G) by the Jan. 31 due date. The directive replaces the 30-day automatic extension with a single, non-automatic, written extension request. The additional 30-day extension is no longer available.

Requests for an extension of time to file Form W-2 must be submitted on paper Form 8809 and postmarked by Jan. 31, 2017. Requests must include an explanation for the request. Approvals are not automatic: Requests will be evaluated on a case by case basis. Correspondence will be issued if the Form 8809 is incomplete or denied. IRS will not issue approval notifications.

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5.  IRS Whistleblower Office Awarded More than $61 Million Last Fiscal Year

Since 2007 information submitted by whistleblowers has assisted the IRS in collecting $3.4 billion in revenue. In turn the IRS has approved more than $465 million in monetary awards to whistleblowers. Learn more in the 2016 Annual Report to Congress.

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6.  EITC Awareness Day is Friday Jan. 27

Tax professionals are invited to join IRS and its partners nationwide to launch the eleventh annual EITC Awareness Day outreach campaign to encourage millions of working taxpayers to get the EITC they earned.

EITC Awareness Day is an opportunity to generate news media coverage to reach the broadest possible range of eligible taxpayers, including the underserved populations and the newly eligible at the time most are filing or getting ready to file their federal income tax returns.

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7.  Want to file IRS Form 941 instead of Form 944?

Employers required to file Form 944, Employers Annual Federal Tax Return, need to contact IRS to change their filing requirements.

To request a change to Form 941, Employer's Quarterly Federal Tax Return, employers should contact the IRS by April 1. The IRS will respond in writing. More information is available on IRS.gov. Employers may also call the IRS at 1-800-829-4933 for help.

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Issue Number:  2017-1

Inside This Issue

 

1.     IRS and Partners Look to Start of 2017 Tax Season

2.     Use Publication 2043 to Set Refund Expectations for Your Clients

3.     Technical Guidance

1.  IRS and Partners Look to Start of 2017 Tax Season

The Internal Revenue Service and its partners from the states and tax industry remind taxpayers that the nation’s 2017 individual income tax filing season opens Jan. 23.

The IRS expects more than 153 million tax returns to be filed this year, and taxpayers have until Tuesday April 18 to file their 2016 tax returns and pay any tax due.

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2.  Use Publication 2043 to Set Refund Expectations for Your Clients

IRS Publication 2043, IRS Refund Information Guidelines for the Tax Preparation Community, has been updated for 2017. The publication provides the latest refund information and guidelines to advise clients who are expecting refunds.

This year’s update includes information about a new law that requires the IRS to hold refunds claiming the Earned Income Tax Credit and the Additional Child Tax Credit. The IRS will begin to release EITC/ACTC refunds starting Feb. 15. However, these refunds likely will not reach taxpayers until the week of Feb. 27.

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3.  Technical Guidance

Notice 2017-09 provides the requirements for making an election related to information returns and seeks comment on the matters discussed in the notice. Section 202 of the Protecting Americans from Tax Hikes Act of 2015 (P.L. 114-113) amended sections 6721 and 6722 to provide that an error on an information return or payee statement does not need to be corrected to avoid a penalty if the error relates to an incorrect dollar amount and differs from the correct amount by no more than $100 ($25 with respect to an amount of tax withheld). This safe harbor generally does not apply to a payee statement if a payee makes an election that the safe harbor not apply “at such time and in such manner as the Secretary may prescribe.”

Notice 2017-12 provides guidance on the methods available to confirm the closing of an examination of an estate tax return. In addition, the notice announces that an account transcript with a transaction code of “421” and explanation “Closed examination of tax return” can serve as the functional equivalent of an estate tax closing letter in confirming the closing of an examination.

Notice 2017-12 will be in IRB 2017-4 dated Jan. 23.

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Issue Number:  2016-50

Inside This Issue

 

1.     Refundable Credit Due Diligence Training Now Available

2.     User Fees for IRS Installment Agreements Finalized

3.     YouTube: Individual Taxpayer Identification Numbers

4.     New Publication 5273 Outlines Steps to Take Now to Prepare for Filing Season

5.     Standard Mileage Rates for Business, Medical and Moving Announced

6.     Technical Guidance

 

1.  Refundable Credit Due Diligence Training Now Available

Congress recently expanded the Earned Income Tax Credit (EITC) due diligence requirements to include two additional refundable credits – the Child Tax Credit/Additional Child Tax Credit and the American Opportunity Tax Credit. A free IRS training course is now available in English and Spanish to help tax preparers understand and complete their due diligence requirements when applying these credits. View the tax preparer toolkit for more information.

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2.  User Fees for IRS Installment Agreements Finalized

Regulations on new user fees for IRS installment payment agreements are now final. The new fees go into effect Jan. 1. The lowest cost, lowest fee option for taxpayers needing an installment agreement is the IRS Online Payment Agreement application with payments made by direct debit. The new fee for that option is $31, down from $52. The fee for low-income taxpayers using other options to set up an installment agreement remains at $43.

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3.  YouTube: Individual Taxpayer Identification Numbers

Learn about the new procedures for getting an Individual Taxpayer Identification Number in these new videos, available in English and Spanish.

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4.  New Publication 5273 Provides Steps to Take Now to Prepare for Filing Season

Use new IRS Publication 5273, Take Steps Now for Tax Filing Season, to help your clients get ready to file their 2016 federal tax returns.

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5.  Standard Mileage Rates for Business, Medical and Moving Announced

Beginning on Jan. 1, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

·         53.5 cents per mile for business miles driven, down from 54 cents

·         17 cents per mile driven for medical or moving purposes, down from 19 cents

·         14 cents per mile driven in service of charitable organizations

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6.  Technical Guidance

Revenue Ruling 2016-29 relates to allocations of low-income housing credits to projects and clarifies that section 42(m)(1)(A)(ii) of the Code neither requires nor encourages State housing credit allocating agencies to reject the proposed development of a low-income housing project that does not obtain the approval of the locality where the project is proposed to be developed.

Notice 2016-77 relates to allocations of low-income housing credits to projects and serves as a reminder to taxpayers that a project located in a qualified census tract is not described in section 42(m)(1)(B)(ii)(III) of the Code unless the project’s development contributes to a concerted community revitalization plan.

Notice 2016-78 provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used under section 417(e)(3), and the 24-month average segment rates under section 430(h)(2) of the Internal Revenue Code. In addition, this notice provides guidance as to the interest rate on 30-year Treasury securities under section 417(e)(3)(A)(ii)(II) as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate under section 431(c)(6)(E)(ii)(I). The rates in this notice reflect the application of section 430(h)(2)(C)(iv), which was added by the Moving Ahead for Progress in the 21st Century Act, Public Law 112-141 (MAP-21) and amended by section 2003 of the Highway and Transportation Funding Act of 2014, Public Law 113-159 (HATFA).

Notice 2016-80 contains the 2016 Required Amendments List for individually-designed qualified retirement plans. The list identifies certain changes in qualification requirements that became effective in 2016 that may require a retirement plan to be amended in order to remain qualified, and establishes the date by which any necessary amendment must be made. 

Notice 2017-04 updates and clarifies the guidance provided in prior IRS notices regarding the beginning of construction for sections 45 and 48. Specifically, the notice provides clarification regarding the extension and modification of the Continuity Safe Harbor, the prohibition against combining methods by which to satisfy the beginning of construction requirement, and the costs that may be included in the Five Percent Safe Harbor for retrofitted renewable energy facilities.

Revenue Procedure 2017-12 provides that the Internal Revenue Service (IRS) will treat an instrument described in section 3 of this revenue procedure as indebtedness for federal tax purposes.

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