IRS Tax News

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  • 21 Jan 2020 10:18 AM | Anonymous

    Notice 2020-07 provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used under § 417(e)(3), and the 24-month average segment rates under § 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 § 417(e)(3)(A)(ii)(II) as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate under § 431(c)(6)(E)(ii)(I), as reflected by the application of § 430(h)(2)(C)(iv). 

  • 17 Jan 2020 1:36 PM | Anonymous

    WASHINGTON — The IRS announced today that the agency has become aware of limited circumstances in which it may be appropriate to provide relief from double taxation resulting from application of the repatriation tax under section 965, as amended by the Tax Cuts and Jobs Act (TCJA). 

    The IRS has determined that in unique circumstances, such as where a corporation paid an unusual dividend for business reasons, not because of the enactment of TCJA, it may be appropriate to provide relief from double taxation. When the same earnings and profits of foreign corporations are taxed both as dividends and under section 965, double taxation could result.

    The IRS is open to considering relief from such double taxation where there is no significant reduction in the resulting tax by application of foreign tax credits, such that the taxpayer would be required to pay more tax than it would have if the dividend had not been paid. 

    Taxpayers who have fact patterns that may fit these limited circumstances may raise them with the IRS by contacting the Office of Associate Chief Counsel (International) at 202-317-3800.

  • 16 Jan 2020 1:57 PM | Anonymous

    WASHINGTON — As the 2020 tax season approaches, the Internal Revenue Service today encouraged taxpayers, businesses, tax professionals and others to take advantage of a variety of improved e-mail subscription services.

    The e-News Subscription Service has been redesigned and updated in recent months to make it easier to subscribe to specific areas that people and organizations are interested in. Among others, the IRS offers subscription services tailored to tax exempt and government entities, small and large businesses and individuals.

    The IRS currently has 20 registration-based e-News options, including: 

    • IRS Tax Tips – These brief, concise tips in plain language that cover a wide-range of topics of general interest to taxpayers. They include the latest on tax scams and schemes, tax reform, tax deductions, filing extensions and amending a return. IRS Tax Tips are distributed daily during tax season and periodically throughout the year.
    • IRS Newswire − Subscribers to IRS Newswire receive news releases the day they are issued. These cover a wide range of tax administration issues ranging from breaking news to details related to legal guidance.
    • IRS News in Spanish (Noticias del IRS en Español) − Readers get IRS news releases, tax tips and updates in Spanish as they are released. Subscribe at Noticias del IRS en Español.
    • e-News for Tax Professionals − Includes a weekly roundup of news releases and legal guidance specifically designed for the tax professional community.  Subscribing to e-News for Tax Professionals gets tax pros a weekly summary, typically delivered on Friday afternoons.
    • IRS Outreach Connection − This newest IRS subscription offering delivers up-to-date materials for tax professionals and partner groups inside and outside the tax community. The material for Outreach Connection is specifically designed so subscribers can share the material with their clients or members through email, social media, internal newsletters, e-mails or external websites. Subscribe by visiting IRS.gov/outreachconnect.

    For more information and other IRS subscriptions designed for specific groups, visit IRS e-News Subscriptions. The resources will help taxpayers and organizations keep up with the latest information during and after filing season.

  • 16 Jan 2020 1:56 PM | Anonymous

    WASHINGTON – Most taxpayers can do both their federal and state tax returns for free online through Free File offered either by the IRS or by states that have a similar public-private partnership.

    For 2020, taxpayers whose prior-year adjusted gross income was $69,000 or less, and that’s most people, can use IRS Free File. Generally, taxpayers must complete their federal tax return before they can begin their state taxes. 

    More than 20 states also have a state Free File program patterned after federal partnership which means many taxpayers are eligible for free federal and free state online tax preparation. Those states are: Arkansas, Arizona, Georgia, Idaho, Indiana, Iowa, Kentucky, Massachusetts, Michigan, Minnesota, Missouri, Mississippi, Montana, New York, North Carolina, North Dakota, Oregon, Rhode Island, South Carolina, Vermont, Virginia and West Virginia, plus the District of Columbia.

    In addition, IRS Free File partners – featuring 10 brand-name online products - offer most or some state tax returns for free as well. Some may also charge so it is important for taxpayers to explore their free options.

    Here’s how Free File works:

    1. Go to IRS.gov/FreeFile to see all Free File options.
    2. Browse each of the 10 offers or use a “look up” tool to help you find the right product. Each Free File partner sets its own eligibility standards generally based on income, age and state residency. But if your adjusted gross income was $69,000 or less, you will find at least one free product to use. Two products are in Spanish.
    3. Select a provider and follow the links to their web page to begin your tax return.
    4. Complete and e-File your tax return only if you have all the income and deduction records you need. The fastest way to get a refund is by filing electronically and selecting direct deposit. If you owe, use direct pay or electronic options.

    Free File partners will charge a fee for state tax return preparation unless their offer outlines upfront that you can file both federal and state returns for free. If you want to use one of the state Free File program products, go to your state tax agency’s Free File page.

    For residents of Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming, IRS Free File may be the only tax product you need. Those states do not have an income tax.

  • 16 Jan 2020 1:56 PM | Anonymous

    WASHINGTON – The Internal Revenue Service today announced it will return sequestered funds to businesses that were affected by a recent Office of Management and Budget (OMB) determination regarding the Balanced Budget and Emergency Deficit Control Act of 1985, as amended.

    The IRS will restore any amounts sequestered since 2013 under section 168(k)(4). OMB determined that the refundable corporate minimum tax credit claimed under sections 53 and 168(k)(4) of title 26, U.S. Code as in effect for taxable years beginning before Jan. 1, 2018, is not subject to sequestration.

    The IRS has a complete list of all taxpayers affected so taxpayers do not need to take any action. Funds and applicable interest will be sent out during fiscal year 2020. Less than 1,000 businesses were affected by the OMB determination. Funds due a company will be used to offset current tax liabilities first.

    Formerly, refund payments issued to, and credit elect and refund offset transactions for, corporations claiming refundable minimum tax credits for prior year alternative minimum tax liability were subject to sequestration. The OMB determination corrects and reverses the previous determination.

    Additional information will be shared regarding the timing and process for these reimbursements when it is available.

  • 16 Jan 2020 1:55 PM | Anonymous

    WASHINGTON — The Internal Revenue Service and Department of the Treasury issued Revenue Procedure 2020-11 that establishes a safe harbor extending relief to additional taxpayers who took out federal or private student loans to finance attendance at a nonprofit or for-profit school. 

    Relief is also extended to any creditor that would otherwise be required to file information returns and furnish payee statements for the discharge of any indebtedness within the scope of this revenue procedure.

    The Treasury Department and the IRS have determined that it is appropriate to extend the relief provided in Rev. Proc. 2015-57, Rev. Proc. 2017-24 and Rev. Proc. 2018-39 to taxpayers who took out federal and private student loans to finance attendance at nonprofit or other for-profit schools not owned by Corinthian College, Inc. or American Career Institutes, Inc.

    The Revenue Procedure provides relief when the federal loans are discharged by the Department of Education under the Closed School or Defense to Repayment discharge process, or where the private loans are discharged based on settlements of certain types of legal causes of action against nonprofit or other for-profit schools and certain private lenders.

    Taxpayers within the scope of this revenue procedure will not recognize gross income as a result of the discharge, and the taxpayer should not report the amount of the discharged loan in gross income on his or her federal income tax return. 

    Additionally, the IRS will not assert that a creditor must file information returns and furnish payee statements for the discharge of any indebtedness within the scope of this revenue procedure. To avoid confusion, the IRS strongly recommends that these creditors not furnish students nor the IRS with a Form 1099-C.

  • 16 Jan 2020 1:54 PM | Anonymous

    Revenue Procedure 2020-11 provides relief to additional taxpayers who took out federal or private student loans to finance attendance at a nonprofit or for-profit school.  The IRS will not assert that taxpayers within the scope of the revenue procedure must recognize gross income as a result of the discharge of their student loans.  Additionally, the IRS will not assert that a creditor must file information returns and furnish payee statements for the discharge of any indebtedness within the scope of the revenue procedure.  To avoid confusion, the IRS strongly recommends that these creditors not furnish students nor the IRS with a Form 1099-C.

    Revenue Procedure 2020-11 will be in IRB 2020-6, dated February 3, 2020.

  • 15 Jan 2020 2:42 PM | Anonymous

    Revenue Ruling 2020-03 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 § 1274.  

    The rates are published monthly for purposes of sections 42, 382, 412, 642, 1288, 1274, 7520, 7872, and various other sections of the Internal Revenue Code. 

    Revenue Ruling 2020-03 will be in IRB:  2020-6, dated February 3, 2020.

  • 15 Jan 2020 2:27 PM | Anonymous

    Notice 2020-08 provides the rules that claimants must follow to make a one-time claim for the credits and payments for biodiesel (including renewable diesel) mixtures and alternative fuels sold or used during calendar years 2018 and 2019.  The notice also provides instructions for how a claimant may offset its taxable fuel liability with the alternative fuel mixture credit for 2018 and 2019, and provides instructions for how a claimant may make certain income tax claims for biodiesel, second generation biofuel, and alternative fuel.  The credits had expired on December 31, 2017, but were retroactively reinstated as part of the Further Consolidated Appropriations Act of 2020.

    Notice 2020-08  will be in 2020-07, dated February 10, 2020.

  • 15 Jan 2020 11:13 AM | Anonymous

    WASHINGTON – Seniors and retirees whose income is under $69,000 a year should explore IRS Free File for free online tax preparation.

    Seniors are one of the key constituents for Free File which has served 57 million taxpayers and saved them $1.7 billion since the online filing service debuted in 2003.

    Free File – which features 10 brand-name tax software providers – also offers the new Form 1040-SR option for seniors over the age of 65.

    “When you’re on a fixed income, every penny saved matters. With Free File, you can save lots of pennies. Free File also does all the hard work for you. It finds the right forms, benefits and does all the math,” said Ken Corbin, commissioner of IRS’ Wage and Investment division.

    Free File supports all the major forms that can be filed electronically so even if your return is a bit more complex, you can still use a free service.

    Here’s how Free File works:

    1. Go to IRS.gov/FreeFile to see all Free File options.
    2. Browse each of the 10 offers or use a “look up” tool to help you find the right product. Each Free File partner sets its own eligibility standards generally based on income, age and state residency. But if your adjusted gross income was $69,000 or less, you will find at least one free product to use. Two products are in Spanish.
    3. Select a provider and follow the links to their web page to begin your tax return.
    4. Complete and e-File your tax return only if you have all the income and deduction records you need. The fastest way to get a refund is by filing electronically and selecting direct deposit. If you owe, use direct pay or electronic options.

    Free File providers also offer state tax return preparation, some for free and some for a fee. Again, use the “look up” tool to find the right product. Here’s another plus for Free File: you can use your smart phone or tablet to do your taxes. Just go to IRS.gov/FreeFile on your device. All Free File products are enabled for mobile devices.

    Seniors who are not comfortable preparing their own tax return still have other free options. The IRS helps support the Volunteer Income Tax Assistance program and AARP supports the Tax Counseling for the Elderly program. Volunteers will prepare your tax return for you for free. Use the VITA locator tool to find a VITA/TCE location near you.

    Free File is available now through October to accommodate extension filers.

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