Issue Number:  2025-05 Inside This Issue 2025 filing season underway with expanded services for taxpayers IRS, national partners promote EITC Awareness Day on 50th anniversary of the Earned Income Tax Credit Upcoming webinars and continuing education for tax professionals News from the Justice Department’s Tax Division 1.  2025 filing season underway with expanded services for taxpayers The IRS opened the 2025 tax season on Jan. 27 with a focus on expanding options and features to help taxpayers. The IRS expects more than 140 million individual tax returns to be filed this season. The filing deadline is April 15. Taxpayers residing in a federally declared disaster area may have additional time to file and pay federal taxes. Back to top 2.  IRS, national partners promote EITC Awareness Day on 50th anniversary of the Earned Income Tax Credit In honor of the 50th anniversary of the Earned Income Tax Credit, the IRS and its partners nationwide launched this year’s EITC Awareness Day Campaign. Now in its 19th year, the annual campaign aims to increase awareness among the millions of working Americans with a low-to-moderate income who are eligible for the EITC. The IRS estimates that roughly one in five eligible taxpayers miss out on claiming this credit. As of December 2024, roughly 23 million workers and families had received about $64 billion total from the EITC, according to IRS statistics. On average, eligible taxpayers received $2,743 from the credit in tax year 2023. Taxpayers may use the EITC Assistant to check their eligibility, which may be affected by changes in marital, parental or financial status. Even if taxpayers do not qualify for the EITC, they may be eligible for other credits or deductions. The Interactive Tax Assistant can help determine eligibility for the Child Tax Credit, Additional Child Tax Credit or Credit for Other Dependents. Visit the Tax Return Preparer Toolkit for more information. Back to top 3.  Upcoming webinars and continuing education for tax professionals The IRS offers the upcoming live webinars to the tax pro community: The ABCs of Foreign Tax Credit for Individuals (FTC) on Feb. 19 at 1 p.m. ET. Earn up to two continuing education credits (Federal Tax). Visit the registration page for this webinar for more information. The IRS also encourages tax professionals to register for the IRS Nationwide Tax Forum Online to get access to 18 seminars recorded at the 2024 IRS Nationwide Tax Forum. The Nationwide Tax Forum Online offers tax professionals a convenient way to stay informed about current legislation, IRS procedures and key topics for the upcoming tax season. Back to top 4.  News from the Justice Department’s Tax Division A federal grand jury in New Jersey returned an indictment charging Christopher Demba with 55 counts of tax return fraud and obstructing the IRS. For tax years 2018 through 2023, Demba, a New Jersey tax preparation business owner, allegedly prepared returns for clients that contained false information resulting in the clients claiming refunds to which they were not entitled. In addition, the claim alleges that Demba obstructed the IRS by providing fictitious working papers to IRS personnel to support some of the claims on returns he prepared for clients. Demba faces three years in prison for each count as well as a period of supervised release, restitution and monetary penalties. IRS Criminal Investigation is investigating the case. Back to top                                       Thank you for subscribing to e-News for Tax Professionals an IRS e-mail service. If you have a specific concern about your client's tax situation, call the IRS Practitioner Priority Service 1-866-860-4259. This message was distributed automatically from the mailing list e-News for Tax Professionals. Please Do Not Reply To This Message To subscribe to or unsubscribe from another list, please go to the e-News Subscriptions page on the IRS Web site.

IRS offers top tips to make tax time easier  

WASHINGTON —The Internal Revenue Service today provided taxpayers with six tips to make filing their 2024 tax return easier. 

Most of the information below is also available on the IRS.gov Let Us Help You page. Taxpayers should follow these handy suggestions as they prepare to file: 

1. Gather all important and necessary tax paperwork and records needed for filing a complete and accurate tax return. Errors and omissions can lead to missing a deduction or credit and slow down tax return processing and refunds. 

Before filing, taxpayers should have their: 

• Social Security numbers for everyone listed on the tax return.
• Bank account and routing numbers.
• Tax forms such as W-2s, 1099s, 1098s, records of digital asset transactions and other income documents.
• Form 1095-A, Health Insurance Marketplace statement.
• IRS letters they may have citing an amount received for a certain tax deduction or credit.

2. Report all types of income on the tax return to avoid receiving a notice or a bill from the IRS. Include income from: 

• Goods created and sold on online platforms.
• Investment income.
• Part-time or seasonal work.
• Self-employment or other business activities.
• Services provided and paid through mobile apps. 

3. Avoid paper returns. Filing electronically with direct deposit is the fastest way to get a refund. Plus, tax software helps taxpayers avoid mistakes. It does the math and guides people through each section of their tax return. 

4. Consider IRS free resources to help eligible taxpayers file. 

• IRS Free File provides a free online alternative to filing a paper tax return to any individual or family who earned $84,000 or less in 2024.
• Direct File is available in 25 participating states for eligible taxpayers to file online directly with the IRS for free. This year, Direct File supports reporting more income types and claiming more credits and deductions. The free web-based service – available in English and Spanish – provides access to IRS customer service representatives through a live chat feature and works on mobile phones, laptops, tablets or desktop computers. Direct File guides taxpayers through a series of questions to prepare their federal tax return step-by-step and automatically guides taxpayers to state tools to complete their state taxes.
• People who make over $84,000 can use the IRS' Free File Fillable Forms. These are the electronic version of IRS paper forms. This product is best for people who are comfortable preparing their own taxes.
• People who generally make $67,000 or less, persons with disabilities, limited English-speaking taxpayers and those who are 60 years of age and older, can also find free one-on-one tax preparation help around the nation through the Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs.
• The Department of Defense provides MilTaxas a free tax resource for the military community. MilTax is a suite of tax services available for members of the military, as well as qualifying veterans and family members. There are no income limits. Eligible taxpayers can use MilTax to electronically file a federal tax return and up to three state returns for free. 

5. Choose tax filing options based on personal situation and comfort level with tax preparation: 

• Personally file taxes.
• Use online filing services.
• Hire a tax professional and choose carefully. Most tax return preparers are professional, honest and provide excellent service to their clients. However, dishonest tax return preparers who file false income tax returns do exist. The IRS has a Directory of Federal Tax Return Preparers with Credentials and Select Qualifications and more on choosing a tax pro on IRS.gov. 

6. Use online resources at IRS.gov to quickly get answers to tax questions, check a refund status or pay taxes. There’s no wait time or appointment needed. Online tools and resources are available 24 hours a day, including the IRS’ Interactive Tax Assistant tooland Let Us Help You resources, which are especially helpful. 

Stay updated 

• Follow the IRS’ official social media accounts and email subscription lists to stay current on the latest tax topics and alerts.
• Download the IRS2Go mobile app.
• Watch IRS YouTube videos.

WASHINGTON — The Internal Revenue Service opened the 2025 tax filing season today and is accepting and processing federal individual tax year 2024 returns.

During today’s early morning opening, IRS systems have already received millions of tax returns from across the nation for processing.

The IRS expects more than 140 million individual tax returns for tax year 2024 to be filed ahead of the Tuesday, April 15 federal deadline. More than half of all tax returns are expected to be filed this year with the help of a tax professional, and the IRS urges people to use a trusted tax pro to avoid potential scams and schemes.

Taxpayers residing in a federally declared disaster area may have additional time to file and pay federal taxes.

Get free help preparing and filing taxes electronically

Taxpayers can visit IRS.gov to get answers to tax questions. IRS.gov is the quickest way for taxpayers to get help. The Interactive Tax Assistant (ITA) is a tool that provides answers to several tax law questions specific to individual circumstances. Based on input, it can determine a taxpayer’s filing status, if a person should file a tax return, if someone can be claimed as a dependent, if a type of income is taxable, if a filer is eligible to claim a credit or if an expense can be deducted.

The IRS encourages people to file their tax returns electronically and choose direct deposit for more secure and faster refunds. According to Treasury’s Bureau of the Fiscal Service, paper refund checks are 16 times more likely to have an issue, like the check being lost, misdirected, stolen or uncashed.  Filing electronically reduces tax return errors as the tax software does the calculations, flags common errors and prompts taxpayers for missing information.

Free tax filing options

The IRS offers free online and in-person tax preparation options for eligible taxpayers through IRS Free File, IRS Direct File and Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs.

IRS Free File. Taxpayers with income of $84,000 or less last year can use IRS Free File Guided Tax Software now through Oct. 15. IRS Free File Fillable forms, a part of this program, is available at no cost to any income level and provides electronic forms that people fill out and e-file themselves, also at no cost.

Direct File. Now open in 25 participating states, taxpayers can use Direct File to file online directly with the IRS for free. It is a free web-based service – available in English and Spanish – that works on mobile phones, laptops, tablets or desktop computers. It guides taxpayers through a series of questions to prepare their federal tax return step-by-step. Direct File automatically guides taxpayers to state tools to complete their state taxes. Get help from IRS customer service representatives through a live chat feature in English and Spanish. Interested taxpayers can go to directfile.irs.gov, where they can determine if they are eligible.

Volunteer Income Tax Assistance (VITA). The VITA program offers free tax help to people who generally make $67,000 or less, persons with disabilities and taxpayers whose preferred language is not English. IRS-certified volunteers provide free basic income tax return preparation with electronic filing to qualified individuals.

In addition to VITA, the Tax Counseling for the Elderly (TCE) program offers free tax help for all taxpayers, particularly those who are 60 and older, specializing in questions about pensions and retirement-related issues unique to seniors.

MilTax. This is a Department of Defense program available to members of the military and some veterans with no income limit. MilTax generally offers free return preparation and electronic filing software for federal income tax returns and up to three state income tax returns.

Most refunds issued in less than 21 days: EITC refunds for many available by March 3

The easiest way to check a refund's status is by using “Where's My Refund?” on IRS.gov or the IRS2Go app.

Many factors can affect refund timing after the IRS receives a tax return. Although the IRS issues most refunds in less than 21 days, the IRS cautions taxpayers not to rely on receiving a refund by a certain date, especially when making major purchases or paying bills. Some returns may require additional review and may take longer.

Under the federal Protecting Americans from Tax Hikes (PATH) Act, the IRS cannot issue Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC) refunds before mid-February. “Where's My Refund?” should show an updated status by February 22 for most early EITC/ACTC filers. The IRS expects most EITC/ACTC related refunds to be available in taxpayer bank accounts or on debit cards by March 3 if they chose direct deposit and there are no other issues with their tax return.

Report taxable income; don’t file before receiving key documents

People should report all taxable income on their tax return and wait to file until they receive all of their income and informational documents. Taxpayers may receive various income and information statements such as Forms 1099 from banks or other payers, unemployment compensation, dividends, pensions, annuities or retirement plan distributions. Taxpayers receiving Forms 1099-K, for payments on sale of goods and services through an online marketplace or payment app, can visit What to do with Form 1099-K to help them figure and report the correct amount of income on their tax return.

Choose a trusted tax professional

More than half of taxpayers turn to a tax professional for help filing a tax return. While most tax preparers deliver exceptional and professional service, selecting the wrong preparer can lead to financial harm.

Taxpayers should review the tips for choosing a tax preparer and learn how to avoid unethical “ghost” returnpreparers who don’t sign or include a valid preparer tax identification number (PTIN) on every tax return they prepare. Taxpayers can also use the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications to find trusted professionals. The IRS also reminds taxpayers that choosing someone affiliated with a recognized national tax association is always a good option. Tax professionals accepted into the IRS electronic filing program are authorized IRS e-file providers, qualified to prepare, transmit and process electronically filed tax returns.

Be aware of tax scams

Be aware of scammers, who can become more active during tax season. They will attempt to mislead people about tax refunds, credits and payments. They pressure people for personal, financial, employment information or money.

Watch out for:

• A big payday. If it sounds too good to be true, it probably is. Bad tax advice on social media may convince people to lie on tax forms or mislead them about credits they can claim.
• Demands or threats. Impersonators want people to pay “now or else.” They threaten arrest or deportation. They don’t let people question or appeal the amount of tax they owe. 
• Odd or misspelled website links. Odd or misspelled web links can take people to harmful sites instead of IRS.gov.

Tax-related identity theft occurs when someone uses stolen personal information, including Social Security numbers, to file a tax return claiming a fraudulent refund. If a person suspects they are a victim of identity theft, they should continue to pay their taxes and file their tax return, even if they must file a paper return. Visit Identity Theft Central to find out more.

Know the signs of identity theft

Thousands of people have lost millions of dollars and their personal information to tax scams. Scammers use the regular mail, telephone and email to set up individuals, businesses, payroll and tax professionals. Check out the latest consumer alerts and read more about the most recent tax related scams identified by the IRS.

More help is now available

The IRS also provides taxpayers help in-person at Taxpayer Assistance Centers nationwide.

Some improvements taxpayers will see during the 2025 filing season are:

IRS Individual Online Account. The IRS continues to add more functionality to this important tool. Individuals can create or access their IRS Online Account at Online account for individuals. With an IRS Online Account, people can:

• View key details from their most recent tax return, such as adjusted gross income.
• Request an Identity Protection PIN.
• Get account transcripts, to include wage and income records.
• Sign tax forms like powers of attorney or tax information authorizations.
• View and edit language preferences and alternative media.
• Receive and view over 200 IRS electronic notices.
• View, make and cancel payments.
• Set up or change payment plans and check their balance.

New scam alert. To help protect taxpayers against emerging threats, there’s a new banner on the Online Account homepage that alerts taxpayers of potential scams and schemes, along with a link to their Digital Notices and Letters page to view correspondence sent to them from the IRS. The feature helps to educate taxpayers on common scams and fraudulent efforts to steal taxpayer information and provide taxpayers with more ability to validate the legitimacy of IRS communications.

Redesigned notices. The IRS successfully redesigned 284 notices in 2024, exceeding the agency’s 200 notice goal. It is important to note that 200 notices were redesigned and deployed in 2024 and an additional 84 redesigned notices are in line to be deployed in 2025. All notices will be added to Individual Online Account so taxpayers receiving a specific letter can see it.

Mobile-adaptive tax forms. Taxpayers can now access 67 forms on cell phones and tablets. The most recent forms feature “save and draft” capabilities, which allow the taxpayer to start a form, save it and return to it later. The addition of save and draft allows for future capabilities, including the ability for multiple spouses to sign a form.

Virtual assistants to help with refunds and other questions. Whether a taxpayer uses an online tool or calls the IRS, they will experience upgraded help features. During filing season 2025, the IRS will offer voicebot services to all taxpayers calling the IRS for refund information. The voicebot is available in English and Spanish and has helped thousands of callers without the need to wait for the next available representative. Taxpayers will have to authenticate their identity to gain access to their refund information by providing select information from their tax return.

Last year the IRS began using online chatbots for various functions. These chatbots use either guided help through choice buttons or an open text box for a customized question. The chatbots use natural language processing and understanding to interpret the input from the taxpayer to provide an appropriate response. To launch the chatbot, the taxpayer simply clicks on the “Chat” button in the lower right corner of the webpage. Currently taxpayers can use chatbots from eight webpages.

Inside This Issue

1. IRS selects 18 new IRS Advisory Council members for 2025
2. IRS, Coalition Against Scam and Scheme Threats announce 2025 filing season changes aimed at increasing fraud detection
3. Get answers to your questions using IRS’ new chatbot feature
4. IRS launches Fast Track Settlement pilot programs to make ADR more efficient
5. Wage statements and certain information returns due Jan. 31
6. Treasury, IRS seek feedback on proposed rules and a draft form for certain corporate reorganizations and separations
7. Upcoming webinars for tax professionals
8. News from the Justice Department’s Tax Division
9. Technical Guidance

1.  IRS selects 18 new IRS Advisory Council members for 2025

The IRS this week announced the appointment of 18 new members to the Internal Revenue Service Advisory Council (IRSAC). Established in 1953, the IRSAC is an organized public forum for IRS officials and representatives of the public to discuss a broad range of issues in tax administration. The Council provides the IRS Commissioner and agency leaders with feedback, observations and recommendations. The Council will present its annual report at a public meeting in November. The Chair of the IRSAC this year is Christine Freeland.

Visit Internal Revenue Service Advisory Council on IRS.gov to learn more.

Back to top

2.  IRS, Coalition Against Scam and Scheme Threats announce 2025 filing season changes aimed at increasing fraud detection

The IRS and its partners in the Coalition Against Scam and Scheme Threats (CASST) this week announced changes for the 2025 filing season to help protect taxpayers from becoming victims of a scam or scheme and preventing tax professionals from having their credentials compromised.

The changes include a new form involving the Fuel Tax Credit designed to make it harder for taxpayers to be misled into claiming the credit. The IRS is also stepping up review on a variety of “other withholding” claims on Form 1040 that have been targets of scammers. And the IRS is reaching out to taxpayers who have potentially been using “ghost preparers” to prepare tax returns.

Back to top

3.  Get answers to your questions using IRS’ new chatbot feature

The IRS recently expanded the availability of chatbot technology to e-Servicessupport to give tax professionals, software developers and transmitters a new way to access answers to frequently asked questions.

The chatbot provides answers to questions such as:

• What is the status of my e-Services Application?
• What is the status of my e-File application?
• Why was my electronically filed return rejected?
• Where do I find information on transmitter control codes?
• What is the status of my electronically filed information return?
• How do I perform software testing?

To access the chatbot, visit our e-Services page on IRS.gov.

Back to top

4.  IRS launches Fast Track Settlement pilot programs to make ADR more efficient

Three pilot programs have been announced by the IRS to test modifications to current alternative dispute resolution (ADR) programs. IRS ADR programs are intended to assist taxpayers resolve tax disputes. The pilots focus on Fast Track Settlement (FTS)—a program that allows Appeals to mediate disputes between a taxpayer and the IRS while the case is still within the jurisdiction of the examination function, and Post-Appeals Mediation (PAM), a program in which a mediator is introduced to help foster a settlement between Appeals and the taxpayer.

“The IRS has been revitalizing existing ADR programs as part of IRS transformation efforts in alignment with the IRS Strategic Operating Plan,” said Elizabeth Askey, Chief of the IRS Independent Office of Appeals. “We’re committed to providing taxpayers who wish to resolve their issues without litigation a choice of effective and efficient ADR options as early as possible.”

Back to top

5.  Wage statements and certain information returns due Jan. 31

Businesses have until Jan. 31 to file certain information returns and wage statements. The Jan. 31 deadline applies to:

• Employers filing Form W-2, Wage and Tax Statement, and Form W-3, Transmittal of Wage and Tax Statements, with the Social Security Administration.
• Payers filing Form 1099-NEC, Nonemployee Compensation, with the IRS.

Jan. 31 is also the deadline to:

• Furnish copies of W-2, Form 1099-NEC and other information returns to the recipients. See each form’s filing instructions for the due dates to furnish copies to recipients.

Back to top

6.  Treasury, IRS seek feedback on proposed rules and a draft form for certain corporate reorganizations and separations

The Department of the Treasury and the IRS released proposed rules for corporate separations and reorganizations, including reporting requirements for multi-year corporate separations. Additionally, the IRS has posted to IRS.gov a preliminary draft of new Form 7216, Multi-Year Transaction Reporting. The new form will give the IRS the information it needs regarding corporate separations, and these proposed regulations offer thorough, authoritative guidance regarding the Internal Revenue Code provisions addressing corporate mergers and acquisitions transactions. Comments on both the proposed regulations and the new form are due by March 17.

Back to top

7.  Upcoming webinars for tax professionals

The IRS offers the upcoming live webinars to the tax pro community:

• Document Upload Tool on Jan. 21 at 2 p.m. ET. Earn up to one continuing education credit (Federal Tax). Visit the webinar’s registration page for more information and to register.
• New Features for Tax Pros: Do Business Faster and Easier with IRS Online on Jan. 23 at 2 p.m. ET. Earn up to two continuing education credits (Federal Tax). Visit the webinar’s registration page for more information and to register.

Back to top

8.  News from the Justice Department’s Tax Division

The Justice Department filed a civil injunction suit against a group of Florida tax return preparers seeking to bar them from owning or operating a tax return preparation business and preparing tax returns. The defendants allegedly used several schemes to prepare and file tax returns that improperly inflated their customers’ returns and falsely reduced their taxable incoming, according to the complaint.

Arthur Grimes, a Florida man who used the “Note Program,” a tax fraud scheme, was found guilty of obstructing the IRS and received a 21-month prison sentence. The tax fraud scheme run by tax return preparers Christopher Johnson and Jasen Harvey included Grimes as a co-conspirator. Grimes caused four false income tax returns to be filed as part of the scheme. The bad actors sought refunds totaling $627,587 of which the IRS paid approximately $270,000. 

Back to top

9.  Technical Guidance

Announcement 2025-06 implements a pilot program testing changes to Fast Track Settlement programs currently available to taxpayers under examination in the Large Business and International, Small Business/Self-Employed, and Tax Exempt/Government Entities divisions.

Notice 2025-08 modifies the New Elective Safe Harbor for the domestic content bonus credit contained in Notice 2024-41, 2024-24 I.R.B. 1615, by updating the tables in sections 4.04(1)-(3), clarifying the rules and defined terms, reclassifying the Manufactured Products and Manufactured Product Components, and by providing new associated cost percentages for those components.

Notice 2025-09 provides safe harbors regarding the incremental cost and retail price equivalent of certain qualified commercial clean vehicles for purposes of the credit for qualified commercial clean vehicles under section 45W of the Internal Revenue Code.

Notice 2025-12 provides the percentage increase for calculating the qualifying payment amounts for items and services furnished during 2025 for purposes of 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 2025-13 sets forth updates on the corporate bond monthly yield curve, the corresponding spot segment rates for December 2024 used under section 417(e)(3)(D), the 24-month average segment rates applicable for January 2025, and the 30-year Treasury rates, as reflected by the application of section 430(h)(2)(C)(iv).

Revenue Procedure 2025-06 provides the exclusive procedures for certain applicable entities, as defined in section 6417(d)(1)(A) of the Internal Revenue Code and the regulations thereunder that are not required to file either a federal income tax return under section 6011 or an annual information return under section 6033(a), but previously filed a Form 990-T solely to make an elective payment election under section 6417, to change their annual accounting period.

Revenue Procedure 2025-13 provides a streamlined method by which taxpayers who have elected the application of the alternative tax under section 831(b) may obtain automatic consent of the Secretary to revoke such election by making certain representations.

Revenue Procedure 2025-14 provides the first Annual Table for sections 45Y and 48E.

Revenue Ruling 2025-04 provides guidance regarding the income and employment tax treatment of contributions and benefits paid in certain situations under a state paid family and medical leave program, as well as the related reporting requirements.

Revenue Ruling 2025-05 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.

WASHINGTON — The Internal Revenue Service today updated the frequently asked questions in Fact Sheet 2025-01.  

These FAQs supersede earlier FAQs that were posted in Fact Sheet 2024-15, on April 17, 2024.  

The updates to the FAQs contain substantial changes within each section of the Energy Efficient Home Improvement Credit and the Residential Clean Energy Property Credit. 

More information about reliance is available.

Revenue Procedure 2025-06 provides the exclusive procedures for certain applicable entities, as defined in § 6417(d)(1)(A) of the Internal Revenue Code and the regulations thereunder that are not required to file either a federal income tax return under § 6011 or an annual information return under § 6033(a), but previously filed a Form 990-T solely to make an elective payment election under § 6417, to change their annual accounting period.  

Revenue Procedure 2025-06 will be in IRB:  2025-6, dated 2/3/2025.

Notice 2025-13 sets forth updates on the corporate bond monthly yield curve, the corresponding spot segment rates for December 2024 used under § 417(e)(3)(D), the 24-month average segment rates applicable for January 2025, and the 30-year Treasury rates, as reflected by the application of § 430(h)(2)(C)(iv).  

Notice 2025-13 will be in IRB:  2025-6, dated February 3, 2025.

WASHINGTON — The Internal Revenue Service and partners in the Coalition of Scam and Scheme Threats (CASST) today released changes for the 2025 filing season designed to help protect taxpayers from becoming victims of a scam or scheme and preventing tax professionals from having their credentials compromised. 

The changes to protect taxpayers include a new form involving the Fuel Tax Credit that’s designed to make it harder for well-meaning taxpayers to be misled into claiming the credit by promoters. This specialized credit that’s been promoted on social media is designed for off-highway business and farming use. Taxpayers need a business purpose and a qualifying business activity such as running a farm or purchasing aviation gasoline to be eligible for the credit. Most taxpayers don’t qualify for this credit. 

The IRS is also stepping up review on a variety of “other withholding” claims on Form 1040 that have been targets of scammers and schemers. And the IRS is reaching out to taxpayers who have potentially been using “ghost preparers” to prepare tax returns. These preparers don’t identify themselves on the tax return, which is a red flag for taxpayers to be misled into a scam or scheme. 

Convened at the request of IRS Commissioner Danny Werfel, the CASST task force of federal and state tax agencies, software and financial companies, as well as key national tax professional associations, agreed to a new public private partnership in August focused on scams and schemes. 

“Since its creation, this special group across the tax community has been working to take extra steps to protect taxpayers and the tax professional community,” Werfel said. “This effort includes expanding outreach and education on emerging scams, developing innovative approaches to identify potentially fraudulent returns at the point of filing and creating infrastructure improvements to protect taxpayers as well as federal, state and industry tax systems. CASST partners have already worked together on important changes to protect taxpayers and tax professionals in the 2025 filing season, but this needs to be an ongoing effort given the continued expansion and threats from scams.” 

CASST accomplishments that will improve the 2025 tax season 

Highlights of the coalition’s accomplishments include: 

• New Fuel Tax Credit Statement - The IRS developed the “Statement Supporting Fuel Tax Credit (FTC) Computation - 1”, to educate taxpayers on eligibility requirements for claiming the credit. 

Here are key details: 

• Increased Review of “Other Withholding” Claims – To protect taxpayers, the IRS is increasing its review of “Other Withholding” on Line 25C of Form 1040. To reduce potential delays in verifying the “Other Withholding” claimed, taxpayers are encouraged to attach the supporting documentation to their return. Key forms covered by Line 25c, “Other Withholding”, include Form 1042-S, Foreign Person's U.S. Source Income Subject to Withholding; Form 8805, Foreign Partner's Information Statement of Section 1446 Withholding Tax; Form 8288-A, Statement of Withholding on Dispositions by Foreign Persons of U.S. Real Property Interests; Form W2G, Certain Gambling Winnings; Form 8959, Additional Medicare Tax; and Schedule K1, Partner’s Share of Income, Deductions, Credits, etc. 

• Increased “Ghost Preparer” Education – During the 2025 filing season, the IRS will send letters to taxpayers whose tax returns appear to have been completed by a paid tax preparer who did not sign or include their Preparer Tax Identification Number (PTIN) on the tax return. The letters are meant to educate the taxpayer about “ghost preparers” and to help the IRS identify those who are being paid to prepare returns and are not signing or including their PTIN on the return. The IRS continues to see instances where ghost preparers dupe taxpayers into filing inaccurate tax returns for bigger refunds. The preparers later vanish like a ghost, leaving the taxpayer exposed to inaccurate claims. 

• Preparer Tax Identification Numbers (PTIN) - During the 2025 filing season, the IRS will be working to add more protections for tax professionals. The protections will be aimed at protecting the tax professional’s Electronic Filing Identification Number or EFIN and PTIN from unauthorized use; more details on these will be available in the near future. 

Stay vigilant 

Threats are present year-round, but the IRS and CASST members anticipate that misinformation spread by influencers and outright scammers will intensify around the 2025 tax season in an effort to persuade the public to take their bad advice. 

Instead of looking to ill-informed information on social media or from shady tax return preparers presenting themselves as reputable tax professionals, a better option for taxpayers is to learn what scams are trending and to speak to a trusted tax professional. 

Additional information on tax scams can be found at Tax Scams, and victims of tax-related identity theft can visit Identity Theft Central. 

Other reliable tax information is available from the following trusted sources:

• Follow IRS social media.
• Visit an IRS walk-in center.
• Talk to a trusted tax professional. 

Pass it on 

The IRS encourages the public to report improper and abusive tax schemes, as well as tax return preparers who knowingly prepare improper returns, including “ghost preparers.” 

To report an abusive tax scheme or a tax return preparer, people should mail or fax a completed Form 14242, Report Suspected Abusive Tax Promotions or Preparers, and any supporting material to the IRS Lead Development Center in the Office of Promoter Investigations. 

Mail:

Internal Revenue Service

Lead Development Center MS7900 1973 N. Rulon White Blvd Ogden, UT 84404 Fax: 877-477-9135 

Alternatively, taxpayers and tax professionals may report the information to the IRS Whistleblower Office for possible monetary award. 

Taxpayers can also report scams to the Treasury Inspector General for Tax Administration or the Internet Crime Complaint Center. The Report Phishing and Online Scams page at IRS.gov provides complete details.

Notice 2025-12 provides the percentage increase for calculating the qualifying payment amounts for items and services furnished during 2025 for purposes of 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 2025-12 will be in IRB: 2025–8, dated 2/18/2025.

WASHINGTON – The Department of the Treasury and the Internal Revenue Service today issued proposed regulations for corporate separations and reorganizations, including reporting requirements for multi-year corporate separations.

In connection with this proposed guidance, the IRS has posted to IRS.gov a draft version of new Form 7216, Multi-Year Transaction Reporting. These proposed regulations provide comprehensive, authoritative guidance with respect to core provisions of the Internal Revenue Code addressing corporate mergers and acquisitions transactions, and the new form will provide the IRS with necessary information with respect to corporate separations.

Treasury and IRS have proposed this guidance to improve the IRS’s ability to administer the rules in the tax law governing the distribution of stock and securities of a controlled corporation, and to ensure that corporate separations satisfy the requirements to qualify for tax-free treatment. The proposed reporting regulations require certain filers to attach the new Form 7216 to their federal income tax return to provide data to the IRS regarding their multi-year corporation separation. Generally, filers would include the distributing corporation, the controlled corporation and certain significant shareholders or security holders of the distributing corporation.

Importantly, the increased reporting requirements under the proposed reporting guidance would enable Treasury and the IRS to provide increased transactional flexibility through the proposed regulations. Examples of this increased transactional flexibility include addressing retentions of controlled corporation stock, monetization transactions and several other significant issues that arise from multi-year transactions.

The IRS intends to follow these proposed regulations when it issues private letter rulings about certain corporate separations. The IRS plans to issue an update to Rev. Proc. 2024-24 to incorporate these proposed regulations into the procedures for requesting such private letter rulings.

Treasury and IRS invite comments on both the proposed regulations and the new form. Commentors are encouraged to use the Federal e-Rulemaking portal to submit comments on both the proposed substantive regulations (users should indicate “IRS” and “REG-112261-24”) and the proposed reporting regulations and related form (users should indicate “IRS” and “REG-116085-23”). However, comments may also be mailed to: CC:PA:01:PR, Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044.  Comments are due by March 17, 2025. Interested parties can also use the portal and the address above to provide comments regarding the draft of Form 7216.