WASHINGTON – The Internal Revenue Service reminds the nation’s more than 780,000 active tax return preparers to start the upcoming 2021 filing season smoothly by renewing their Preparer Tax Identification Numbers now. All current PTINs will expire Dec. 31, 2020.

“Large segments of the taxpaying public rely on tax return preparers to assist them in complying with their filing and payment obligations” said IRS Return Preparer Director, Carol A. Campbell.  “Obtain or renew your PTIN now so you will be prepared to assist when filing season opens.”

Anyone who prepares or helps prepare a federal tax return for compensation must have a valid PTIN from the IRS before preparing returns, and they need to include the PTIN as the identifying number on any return filed with the IRS.

Tax preparers must pay a fee of $35.95 to renew or obtain a PTIN for 2021. The PTIN fee is non-refundable.

Tax preparers with a 2020 PTIN should use the online renewal process, which takes about 15 minutes to complete. Form W-12, along with the instructions, provides a paper option for PTIN applications and renewals. However, the paper form can take four to six weeks to process. Failure to have and use a valid PTIN may result in penalties.

To renew a PTIN online:

Once completed, users will receive confirmation of their PTIN renewal.

The online system not only allows PTIN renewal, but can also be used by tax preparers to view  a summary of the number of filed returns their PTIN has appeared on in the current year, and to receive communications through a secure mailbox from the IRS Return Preparer Office.

First time PTIN applicants can also apply for a PTIN online.

To apply for a PTIN online:

Opportunity for non-credentialed tax preparers

The Annual Filing Season Program is a voluntary IRS program intended to encourage non-credentialed tax return preparers to take continuing education courses to increase their knowledge and improve their filing season readiness.

Those who choose to participate must renew their PTIN, complete 18 hours of continuing education from IRS-approved CE providers and consent to adhere to specific obligations in Circular 230 by Dec. 31, 2020. The IRS has a video available on how to sign the Circular 230 consent and print the Record of Completion.

After completing the steps, the return preparer receives an Annual Filing Season Program Record of Completion from the IRS. Program participants are then included in a public directory of return preparers with credentials and select qualifications on the IRS website.

The searchable IRS directory helps taxpayers find preparers in their area who have completed the program or hold professional credentials recognized by the IRS.

Enrolled agent credential

The enrolled agent credential is an elite certification issued by the IRS to tax professionals who demonstrate special competence in federal tax planning, individual and business tax return preparation and representation matters. Enrolled agents have unlimited representation rights, allowing them to represent any client before the IRS on any tax matter.

As non-credentialed return preparers think about next steps in their professional career, the IRS encourages them to consider becoming an enrolled agent.

All enrolled agents, regardless of whether they prepare returns, must renew their PTIN annually in order to maintain their active status.

WASHINGTON — Victims of the California wildfires that began on Sept. 4 now have until Jan. 15, 2021, to file various individual and business tax returns and make tax payments, the Internal Revenue Service announced today.

The IRS is offering this relief to any area designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual assistance. Currently this includes Fresno, Los Angeles, Madera, Mendocino, San Bernardino, San Diego and Siskiyou counties in California, but taxpayers in localities added later to the disaster area will automatically receive the same filing and payment relief. The current list of eligible localities is always available on the disaster relief page on IRS.gov.

This relief is separate from that provided for the California wildfires that began on Aug. 14. See the agency’s Aug. 26 announcement for details.

The tax relief postpones various tax filing and payment deadlines that occurred starting on Sept. 4, 2020. As a result, affected individuals and businesses will have until Jan. 15, 2021, to file returns and pay any taxes that were originally due during this period. This means individuals who had a valid extension to file their 2019 return due to run out on Oct. 15, 2020, will now have until Jan. 15, 2021, to file. The IRS noted, however, that because tax payments related to these 2019 returns were due on July 15, 2020, those payments are not eligible for this relief.

The Jan. 15, 2021 deadline also applies to quarterly estimated income tax payments due on Sept. 15, 2020, and the quarterly payroll and excise tax returns normally due on Nov. 2, 2020. It also applies to tax-exempt organizations, operating on a calendar-year basis, that had a valid extension due to run out on Nov. 16, 2020. Businesses with extensions also have the additional time including, among others, calendar-year corporations whose 2019 extensions ran out on Oct. 15, 2020.    

In addition, penalties on payroll and excise tax deposits due on or after Sept. 4 and before Sept. 21, will be abated as long as the deposits were made by Sept. 21, 2020.

The IRS disaster relief page has details on other returns, payments and tax-related actions qualifying for the additional time.

The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. Therefore, taxpayers do not need to contact the agency to get this relief. However, if an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date falling within the postponement period, the taxpayer should call the number on the notice to have the penalty abated.

In addition, the IRS will work with any taxpayer who lives outside the disaster area but whose records necessary to meet a deadline occurring during the postponement period are located in the affected area. Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.

Individuals and businesses in a federally declared disaster area who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2020 return normally filed next year), or the return for the prior year (2019). Be sure to write the FEMA declaration number – 4569 − for the wildfires in California on any return claiming a loss. See Publication 547 for details.

The tax relief is part of a coordinated federal response to the damage caused by the wildfires and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.

WASHINGTON — Victims of Hurricane Delta that began on Oct. 6 now have until Feb. 16, 2021 to file various individual and business tax returns and make tax payments, the Internal Revenue Service announced today.

The IRS is offering this relief to any area designated by the Federal Emergency Management Agency (FEMA) as qualifying for individual assistance. Currently this includes Acadia, Calcasieu, Cameron, Jefferson Davis and Vermilion parishes in Louisiana, but taxpayers in localities qualifying for individual assistance added later to the disaster area, elsewhere in the state and in neighboring states, will automatically receive the same filing and payment relief. The current list of eligible localities is always available on the disaster relief page on IRS.gov.

The tax relief postpones various tax filing and payment deadlines that occurred starting on Oct. 6, 2020. As a result, affected individuals and businesses will have until Feb. 16, 2021, to file returns and pay any taxes that were originally due during this period.

This means individuals who had a valid extension to file their 2019 return due to run out on Oct. 15, 2020, will now have until Feb. 16, 2021, to file. For any of these localities that were also impacted by Hurricane Laura, this also means an additional extension beyond the Dec. 31 deadline announced in August. The IRS noted, however, that because tax payments related to these 2019 returns were due on July 15, 2020, those payments are not eligible for this relief.

The Feb. 16, 2021 deadline also applies to quarterly estimated income tax payments due on Jan. 15, 2021, and the quarterly payroll and excise tax returns normally due on Nov. 2, 2020 and Feb. 1, 2021. It also applies to tax-exempt organizations, operating on a calendar-year basis, that had a valid extension due to run out on Nov. 16, 2020. Businesses with extensions also have the additional time including, among others, calendar-year corporations whose 2019 extensions run out on Oct. 15, 2020.    

In addition, penalties on payroll and excise tax deposits due on or after Oct. 6 and before Oct. 21, will be abated as long as the deposits are made by Oct. 21, 2020.

The IRS disaster relief page has details on other returns, payments and tax-related actions qualifying for the additional time.

The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. Therefore, taxpayers do not need to contact the agency to get this relief. However, if an affected taxpayer receives a late filing or late payment penalty notice from the IRS that has an original or extended filing, payment or deposit due date falling within the postponement period, the taxpayer should call the number on the notice to have the penalty abated.

In addition, the IRS will work with any taxpayer who lives outside the disaster area but whose records necessary to meet a deadline occurring during the postponement period are located in the affected area. Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.

Individuals and businesses in a federally declared disaster area who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2020 return normally filed next year), or the return for the prior year (2019). Be sure to write the FEMA declaration number – 4570 − for Hurricane Delta in Louisiana on any return claiming a loss. See Publication 547 for details.

The tax relief is part of a coordinated federal response to the damage caused by Hurricane Delta and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.

WASHINGTON — The Internal Revenue Service is combating fraud by once again joining organizations around the world to highlight the third annual International Charity Fraud Awareness Week, Oct. 19-23.

International Charity Fraud Awareness Week (ICFAW) brings together everyone involved in the charity and not-for-profit sectors to raise awareness of and share good practices for tackling fraud and cybercrime. This award-winning campaign is led by a coalition of over 40 charities, regulators, law enforcement organizations, representative and umbrella bodies, and other not-for-profit stakeholders.

The IRS is partnering with ICFAW as part of its ongoing commitment to fight fraud against charities, businesses and individuals.

All charities are susceptible to fraud and can be targeted. Those providing services and supporting local communities may be especially vulnerable to fraudsters attempting to exploit the current pandemic or weather-related disasters. More than ever, charities need to be fraud aware and take steps to protect their money, people and assets from harm.

“Especially during these uncertain times, it’s vital for everyone to remain vigilant against fraud, identity theft, scams and schemes,” said IRS Director of Exempt Organizations and Government Entities, Margaret Von Lienen. “Cybercriminals are always on the lookout for new opportunities, and COVID-19 is just one more chance to take advantage of unsuspecting individuals and charities. This campaign provides resources that can help protect charities and other organizations.”

This year’s campaign has three core messages: be fraud aware, take time to check, and keep your charity safe.

The ICFAW Charity Fraud Hub features helpful documents, free tutorials, videos, case studies and on-demand webinars, including, ‘COVID-19 and charity fraud: what to watch out for and how to stay safe.’ Charities and anyone else interested in fighting fraud can also take part in the ICFAW social media campaign using #charityfraudout.

Those encouraged to participate in the week’s activities include:

In addition to crooks who target charities, those who create fake charities are a problem for the non-profit community. In fact, fake charities are once again part of the IRS’ “Dirty Dozen” tax scams for 2020. Taxpayers can find legitimate and qualified charities with the Tax Exempt Organization Search tool on IRS.gov.

Visit the Fraud Advisory Panel website to learn more about ICFAW and how to get involved.

Revenue Procedure 2020-46 modifies and updates Rev. Proc. 2016-47, 2016-37 I.R.B. 346, which provides a list of permissible reasons for a taxpayer to self-certify eligibility for a waiver of the 60-day rollover requirement under certain eligible retirement plans. This Revenue Procedure modifies that list by adding a new reason: a distribution was made to a state unclaimed property fund.

Revenue Ruling 2020-24 clarifies the federal income tax withholding and reporting obligations that apply for the year a payment is made from a qualified plan to a state unclaimed property fund.

Revenue Ruling 2020-22 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. 

 

WILL BE IN IRB:  2020-45              DATED:  November 2, 2020

Revenue Procedure 20-43 provides the inflation-adjusted maximum dollar amount that may be made newly available for excepted benefit health reimbursement arrangements or other account-based group health plans for plan years beginning after December 31, 2020, and before January 1, 2022. Due to indexing methodology requiring rounding down to the nearest $50 increment, this amount remains $1,800 for the 2021 plan year.

 

WILL BE IN IRB: 2020-45   DATED:  11/02/2020

Notice 2020-77 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).