Notice 2021-06 waives the requirement to file certain information returns and furnish certain payee statements pursuant to section 279 of the COVID-related Tax Relief Act.  The waiver applies to Form 1099 series information returns for specified grants, payments, subsidies and loan forgiveness excludible from income under various COVID-19 relief acts.  The notice does not waive information reporting requirements to file and furnish Forms 1098 and 1098-T with respect to those amounts.

Notice 2021-06 will be in IRB 2021-6, dated Monday 02/08/2021.

Revenue Ruling 2021-04 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, and 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 will be in IRB:  2021-06, dated February 8, 2021.

Notice 2021-09 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). 

Notice 2021-09 will be in IRB:   2021-5, dated February 1, 2021.

Notice 2021-08 provides a waiver of the addition to tax under § 6654 for underpayment of estimated income tax by individual taxpayers, where the underpayment is attributable to the amendment to § 461(l)(1)(B) made by the CARES Act.  The relief, which is not automatic, applies only for the purpose of calculating installments of estimated income tax of an affected individual taxpayer that were due on or before July 15, 2020, with respect to the taxable year that began during 2019. 

Notice 2021-08 will be in IRB:  2021-6, dated 02/08/2021.

Notice 2021-12 extends the temporary relief from certain requirements under § 42 for qualified low-income housing projects and under §§ 142(d) and 147(d) for qualified residential rental projects that was provided in Notice 2020-53, 2020-30 I.R.B. 151 in response to the continuing Coronavirus Disease 2019 (COVID-19) pandemic.  This notice also provides relief for additional § 42 requirements not previously addressed in Notice 2020-53.

Notice 2021-12 will be in IRB:  2021-6, dated February 8, 2021.

Revenue Ruling 2021-03 provides  the covered compensation tables effective January 1, 2021.

Revenue Ruling 2021-03 will be in IRB: 2021-5, dated February 1, 2021.

WASHINGTON ― The Internal Revenue Service announced that the nation's tax season will start on Friday, Feb. 12, 2021, when the tax agency will begin accepting and processing 2020 tax year returns.

The Feb. 12 start date for individual tax return filers allows the IRS time to do additional programming and testing of IRS systems following the Dec. 27 tax law changes that provided a second round of Economic Impact Payments and other benefits.

This programming work is critical to ensuring IRS systems run smoothly. If filing season were opened without the correct programming in place, then there could be a delay in issuing refunds to taxpayers. These changes ensure that eligible people will receive any remaining stimulus money as a Recovery Rebate Credit when they file their 2020 tax return.

To speed refunds during the pandemic, the IRS urges taxpayers to file electronically with direct deposit as soon as they have the information they need. People can begin filing their tax returns immediately with tax software companies, including IRS Free File partners. These groups are starting to accept tax returns now, and the returns will be transmitted to the IRS starting Feb. 12.

“Planning for the nation’s filing season process is a massive undertaking, and IRS teams have been working non-stop to prepare for this as well as delivering Economic Impact Payments in record time,” said IRS Commissioner Chuck Rettig. “Given the pandemic, this is one of the nation’s most important filing seasons ever. This start date will ensure that people get their needed tax refunds quickly while also making sure they receive any remaining stimulus payments they are eligible for as quickly as possible.”

Last year’s average tax refund was more than $2,500. More than 150 million tax returns are expected to be filed this year, with the vast majority before the Thursday, April 15 deadline.

Under the PATH Act, the IRS cannot issue a refund involving the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC) before mid-February. The law provides this additional time to help the IRS stop fraudulent refunds and claims from being issued, including to identity thieves.

The IRS anticipates a first week of March refund for many EITC and ACTC taxpayers if they file electronically with direct deposit and there are no issues with their tax returns. This would be the same experience for taxpayers if the filing season opened in late January. Taxpayers will need to check Where’s My Refund for their personalized refund date.

Overall, the IRS anticipates nine out of 10 taxpayers will receive their refund within 21 days of when they file electronically with direct deposit if there are no issues with their tax return. The IRS urges taxpayers and tax professionals to file electronically. To avoid delays in processing, people should avoid filing paper returns wherever possible.

Tips for taxpayers to make filing easier

To speed refunds and help with their tax filing, the IRS urges people to follow these simple steps:

Key filing season dates

There are several important dates taxpayers should keep in mind for this year’s filing season:

Filing season opening

The filing season open follows IRS work to update its programming and test its systems to factor in the second Economic Impact Payments and other tax law changes. These changes are complex and take time to help ensure proper processing of tax returns and refunds as well as coordination with tax software industry, resulting in the February 12 start date.

The IRS must ensure systems are prepared to properly process and check tax returns to verify the proper amount of EIP’s are credited on taxpayer accounts – and provide remaining funds to eligible taxpayers.

Although tax seasons frequently begin in late January, there have been five instances since 2007 when filing seasons did not start for some taxpayers until February due to tax law changes made just before the start of tax time.

IRS YouTube Video:
Do Your Taxes for Free with Free File - English | Spanish

WASHINGTON – IRS Free File – online tax preparation products available at no charge – launched today, giving taxpayers an early opportunity to claim credits like the Recovery Rebate Credit and other deductions, the Internal Revenue Service announced.

Leading tax software providers make their online products available for free as part of a 19-year partnership with the Internal Revenue Service. There are nine products in English and two in Spanish.

“As we continue to confront the COVID-19 pandemic, IRS Free File and certain other similar online tax preparation products such as MilTax – Tax Services for the Military offered through the Department of Defense − offers taxpayers a free way to do their taxes from the safety of their own home and claim the tax credits and deductions they are due,” said Chuck Rettig, IRS Commissioner. “We encourage eligible taxpayers to take a look at using Free File, MilTax and similar free online tax preparation products this year, to follow the lead of over 4 million people who took advantage of these free services just last year. An IRS tax refund is often the single largest payment families receive during the year. We know how critical that refund is, especially this year."

IRS Free File online products are available to any taxpayer or family who earned $72,000 or less in 2020. MilTax online software will be available on Jan. 19, 2021.

IRS Free File providers will accept completed tax returns and hold them until they can be filed electronically once the IRS begins processing returns. The Free File Fillable Forms, the electronic version of IRS paper forms, also will be available later when the filing season begins. This product is best for people comfortable preparing their own taxes and is safe and secure.

How IRS Free File Online works
Each IRS Free File provider sets its own eligibility rules for products based on age, income and state residency. However, for those who make $72,000 or less, they will find at least one product that matches their needs, and usually more. Some providers also offer free state preparation. Active duty military can use any IRS Free File product if their income was $72,000 or less.

Here’s a step-by-step overview of how to find the right Free File product:

No computer? No problem. IRS Free File products support mobile phone access.

Recovery Rebate Credit and other benefits
IRS Free File is all taxpayers need to claim the Recovery Rebate Credit and other tax benefits such as the Earned Income Tax Credit (EITC).

In 2020, the IRS issued two Economic Impact Payments as part of the economic stimulus efforts. The first payments were up to $1,200 person and $500 per qualifying child. The second payments were up to $600 per eligible person and $600 per qualifying child.

For 2021, eligible taxpayers who did not receive the full amount, can claim it as the Recovery Rebate Credit when they file their 2020 tax return. Use IRS Free File to file and claim this important benefit.

IRS Free File also can be used by working families to claim EITC, which provides a refundable tax credit based on income and family size.

Taxpayers also are reminded that unemployment benefits paid by states are taxable income. States should send Forms 1099-G to those who received jobless benefits.

IRS Free File participants
For 2021, these providers are participating in IRS Free File:

For 2021, the following providers have IRS Free File products in Spanish:

Today, the IRS published the latest executive column, “A Closer Look,” which features Sunita Lough, Deputy Commissioner for Services and Enforcement, addressing the Earned Income Tax Credit, or EITC. “EITC has been benefitting low- and moderate-income workers for 46 years… We estimate that approximately 20% of eligible taxpayers do not claim the EITC. We want everyone who is eligible for the EITC to claim it – after all, it’s your money,” said Lough. Read more here. Read the Spanish version here.

“A Closer Look” is a column from IRS executives that covers a variety of timely issues of interest to taxpayers and the tax community. It also provides a detailed look at key issues affecting everything from IRS operations and employees to issues involving taxpayers and tax professionals.

Check here for prior posts and new updates.

Please contact newsroom@irs.gov for any questions or requests for interviews.

Rev. Proc. 2021-12 extends to September 30, 2021, the expiration dates relevant to the application of the safe harbors in Rev. Proc. 2020 26, 2020-18 I.R.B. 753, and Rev. Proc. 2020 34, 2020-26 I.R.B. 990.

Rev. Proc. 2012-12 will appear in IRB 2021-5, dated Feb. 1, 2021.

WASHINGTON − The Internal Revenue Service today reminded businesses and other payors that the revised Form 1099-MISC, Miscellaneous Income, and the new Form 1099-NEC, Nonemployee Compensation, must be furnished to most recipients by Feb. 1, 2021.

Redesigned Form 1099-MISC

The IRS revised Form 1099-MISC for the 2020 tax year to accommodate the creation of a new Form 1099-NEC. The redesigned 1099-MISC has different box numbers for reporting certain income. Businesses must send Form 1099-MISC to recipients by Feb. 1, 2021, and file it with the IRS by March 1 (March 31 if filing electronically).

If businesses are using Forms 1099-MISC to report amounts in box 8, Substitute Payments in Lieu of Dividends or Interest, or box 10, Gross Proceeds Paid to An Attorney, there is an exception to the normal due date. Those forms are due to recipients by Feb. 16, 2021.

New Form 1099-NEC

Form 1099-NEC is a new form for tax year 2020 for nonemployee compensation of $600 or more to a payee. This form should be filed with the IRS, on paper or electronically, and sent to recipients by Feb. 1, 2021.

There is no automatic 30-day extension to file Form 1099-NEC. However, an extension to file may be available under certain hardship conditions. Also, nonemployee compensation may be subject to backup withholding if a payee has not provided a taxpayer identification number to the payer or the IRS notifies the payer that the Taxpayer Identification Number provided was incorrect.

Deadlines help fraud detection

The due dates for information returns, like Forms 1099-MISC and 1099-NEC help the IRS more easily detect refund fraud by verifying income that individuals report on their tax returns. Payors can help support that process, and avoid penalties, by filing the forms on time and without errors. The IRS recommends e-file as the quickest, most accurate and convenient way to file these forms.

For more information, the instructions for Forms 1099-MISC and 1099-NEC are available on IRS.gov.