etrent17/irs-articles huggingface dataset:
IR-2010-123, Dec. 14, 2010
WASHINGTON — As year end approaches, the Internal Revenue Service today strongly encouraged paid tax return preparers to register now for their new or renewed Preparer Tax Identification Numbers (PTINs) to avoid any last-minute rush.
Starting Jan. 1, 2011, use of the PTIN will be mandatory on all federal tax returns and claims for refund prepared by a paid tax preparer. Individuals who, for compensation, prepare all or substantially all of any federal tax return or claim for refund must use PTINs. Paid preparers must apply for a new or renewed PTIN through the new sign-up system at /taxpros.
"We urge you to register now if you plan on preparing tax returns in 2011. The holidays are approaching and it may be tempting to let this slip," said David R. Williams, leader of the new Return Preparer Office. "Our advice is to register now. It takes 15 minutes, and you’re done. Over 380,000 preparers have registered so far."
Any preparer who obtained a PTIN prior to the new sign-up system launch on Sept. 28, 2010, must apply again. Generally, preparers with existing PTINs will be permitted to retain their existing numbers if the information they provide during the sign-up process matches what the IRS currently has on file.
The PTIN is a nine-digit number that preparers must use when they prepare and sign a tax return or claim for refund. Previously, PTIN use was optional in place of the preparer’s social security number. Mandatory use of the PTIN is part of a broader effort by the IRS to regulate the tax return preparation industry and improve services for taxpayers.
Subscribe to IRS Newswire
IR-2010-121, Dec. 7, 2010
WASHINGTON — The Internal Revenue Service today released proposed regulations that would reduce fees related to application and renewal for enrolled agents and enrolled retirement plan agents. The reduction is related to the preparer tax identification number requirements implemented last month which establish a new registration process and fee for all return preparers.
The proposed regulations (REG-124018-10) would reduce the fee for application and renewal for enrolled agents and enrolled retirement plan agents from $125 to $30. The reduction reflects the fact that the processes used to review enrollment and renewal of enrollment applications are partially duplicative of the new process for reviewing a PTIN application, which costs $64.25.
Individuals granted status as an enrolled agent or enrolled retirement plan agent must renew enrollment every three years.  The renewal schedule is based on the last digit of the individual’s social security number or tax identification number.
Tax professionals and other interested parties have until Jan. 10 to submit comments regarding the proposed regulations.
Delay of Renewal Period for Certain Enrolled Agents
In anticipation of these proposed regulations, the IRS recently announced in Announcement 2010-81 a delay of the renewal period for enrolled agents whose tax identification numbers end in 4, 5, or 6.  The IRS is not accepting or processing applications for renewal of enrollment until further guidance is issued.
Individuals who have successfully completed the special enrollment examination may submit an application for enrollment, but the current user fee of $125 must be paid with the application until final regulations reducing the user fee are published in the Federal Register.  These individuals also may choose to delay filing an application for enrollment until the user fee is reduced.  Individuals who delay filing an application for enrollment may not practice before the IRS until the application is submitted and the Office of Professional Responsibility has granted enrollment.
Reminder of New Registration Requirement for All Return Preparers
The IRS recently launched a new online application system to obtain a PTIN.  All paid tax return preparers who prepare all or substantially all of a tax return are required to use the new registration system to obtain a PTIN.  Individuals who obtained a PTIN prior to Sept. 28, 2010, need to reapply under the new system but generally will be reassigned the same number.
Applicants must pay $64.25 to obtain or renew a PTIN.  Access to the online system is available through the Tax Professionals page on this website. Receipt of a PTIN will be immediate after successful online registration. Or a paper application may be submitted on Form W-12, IRS Paid Preparer Tax Identification Number Application, with a response time of four to six weeks.
For more, see the Tax Professionals page on this website, which features step-by-step instructions and multiple FAQs on the new registration system.
Subscribe to IRS Newswire
IR-2010-120, Dec. 7, 2010
WASHINGTON — The Internal Revenue Service today announced that interest rates for the calendar quarter beginning January 1, 2011, will decrease by one percentage point.  The rates will be:  
three (3) percent for overpayments [two (2) percent in the case of a corporation];
three (3) percent for underpayments;
five (5) percent for large corporate underpayments; and
zero and one-half (0.5) percent for the portion of a corporate overpayment exceeding $10,000.
Under the Internal Revenue Code, the rate of interest is determined on a quarterly basis.  For taxpayers other than corporations, the overpayment and underpayment rate is the federal short-term rate plus 3 percentage points.  Generally, in the case of a corporation, the underpayment rate is the federal short-term rate plus 3 percentage points and the overpayment rate is the federal short-term rate plus 2 percentage points.  The rate for large corporate underpayments is the federal short-term rate plus 5 percentage points.  The rate on the portion of a corporate overpayment of tax exceeding $10,000 for a taxable period is the federal short-term rate plus one-half (0.5) of a percentage point.
The interest rates announced today are computed from the federal short-term rate during October 2010 to take effect November 1, 2010, based on daily compounding.
Revenue Ruling 2010-31PDF, announcing the rates of interest, is attached and will appear in Internal Revenue Bulletin No. 2010-52, dated December 27, 2010.
Subscribe to IRS Newswire
Update — For information on mid-year mileage rate increases for July 1 through Dec. 31, 2011, see IR-2011-69.
Corrected on Dec. 13, 2010, to reflect changes for 2011.
IR-2010-119, Dec. 3, 2010
WASHINGTON — The Internal Revenue Service today issued the 2011 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on Jan. 1, 2011, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
51 cents per mile for business miles driven
19 cents per mile driven for medical or moving purposes
14 cents per mile driven in service of charitable organizations
The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs as determined by the same study. Independent contractor Runzheimer International conducted the study.
A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle.
In addition, the business standard mileage rate cannot be used for more than four vehicles used simultaneously. The IRS is requesting public comments on whether taxpayers should be allowed to use the business standard mileage rate in this circumstance.
Beginning in 2011, a taxpayer may use the business standard mileage rate for vehicles used for hire, such as taxicabs.   
Also beginning in 2011, the standard mileage rates are announced in a separate notice, which also provides the amount a taxpayer must use in calculating reductions to basis for depreciation taken under the business standard mileage rate and the maximum standard automobile cost for automobiles under a FAVR allowance.  The IRS plans to discontinue publishing the standard mileage rate revenue procedure annually but will publish modifications as required.
Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.
Revenue Procedure 2010-51PDF and Notice 2010-88PDF contain additional details regarding the standard mileage rates.
Subscribe to IRS Newswire
IR-2010-118, Dec. 2, 2010
WASHINGTON — The Internal Revenue Service has started sending out more than 10,000 letters to tax return preparers nationwide to remind them of their obligation to prepare accurate tax returns on behalf of their clients.
Also, during the 2011 filing season, IRS representatives will visit approximately 2,500 tax return preparers who received these letters to further discuss their responsibilities as a return preparer and to verify their compliance with existing requirements.
The tax agency is sending the letters to paid preparers who completed tax returns in which the IRS has identified common errors. The letter includes an enclosure that reminds tax return preparers of their responsibilities and consequences of filing incorrect returns.
While most return preparers are professionals who provide honest and excellent service to their clients, some make basic errors or engage in fraud and other illegal activities. The IRS will continue to work closely with the Department of Justice to pursue civil or criminal action as appropriate.
The IRS urges taxpayers to be careful when choosing a preparer. Reputable return preparers will ask to see receipts and will ask multiple questions to determine whether expenses may be claimed as deductions or otherwise qualify for favorable tax treatment. By doing so, they are trying to help their clients avoid penalties, interest or additional taxes that could result from an IRS examination.
These letters and planned visits are another step in increased IRS efforts to heighten awareness of preparer responsibilities and to ensure paid tax return preparers are assisting taxpayers appropriately. The IRS is continuing its efforts to implement the recommendations IRS Commissioner Doug Shulman announced in January following a comprehensive six-month study of the tax return preparer industry.
Reminder of New Registration Requirement for All Return Preparers
The IRS recently launched a new online application system to obtain a Preparer Tax Identification Number (PTIN). All paid tax return preparers who prepare all or substantially all of a tax return are required to use the new registration system to obtain a PTIN. Individuals who obtained a PTIN prior to Sept. 28, 2010, need to reapply under the new system but generally will be reassigned the same number.
Applicants must pay $64.25 to obtain or renew a PTIN.  Access to the online system is available through the Tax Professionals page on this website. Receipt of a PTIN will be immediate after successful online registration. Alternatively, a paper application may be submitted on Form W-12, IRS Paid Preparer Tax Identification Number Application. Preparers choosing this alternative can expect a response time of four to six weeks.
For more, see the Tax Professionals page on this website, which features step-by-step instructions and multiple FAQs on the new registration system.
Subscribe to IRS Newswire
IR-2009-11, Jan. 30, 2009
WASHINGTON ― Many investors will receive their year-end tax statements later than in past years, but these forms are likely to be more accurate, according to the Internal Revenue Service. 
A new law, enacted last fall, changed the deadline from Jan. 31 to Feb. 15, when brokers, including brokerage firms, mutual fund companies and barter exchanges, must furnish year-end Forms 1099-B to their customers. Where a broker furnishes these forms by mail, this means that the forms must be mailed, not received by that date.
Because Feb. 15 falls on Sunday in 2009, and Monday, Feb. 16 is a federal holiday, the deadline is Feb. 17 this year. In addition, the IRS said earlier this month that for calendar-year 2008 reporting, the Feb. 17 deadline also applies to other tax information that brokers report to their customers, including such items as interest and dividends, on a combined year-end statement.
This change is designed to make it easier for brokers to provide investors with accurate year-end statements on stock sales and other transactions.   Inaccurate year-end statements that have to be corrected later often force investors to file amended individual returns.
In its 2006 annual report, the Information Returns Program Advisory Committee (IRPAC) recommended changing this deadline from Jan. 31 to Feb. 15. The report noted that, “Form 1099 reporting has become very complex over recent years. As a result, many broker dealers are currently experiencing 20% amended Forms 1099. There is insufficient time to make the necessary changes in January, verify the data, print the forms and mail them by Jan. 31.” IRPAC is a federal advisory committee that advises the IRS on issues related to information returns, such as Forms 1099.
The long-standing Jan. 31 deadline for providing other year-end forms remains unchanged. However, because Jan. 31 falls on Saturday, employers, banks and other businesses have until Monday, Feb. 2 to mail or otherwise make available various 2008 year-end tax statements. This includes forms in the W-2, 1098 and 1099 series.
Taxpayers can make the tax-filing process faster and easier and often avoid follow-up correspondence with the IRS by carefully reviewing all year-end statements. Make sure all social security numbers are correct, check income and withholding amounts and contact the issuer promptly, if any mistakes are found.
Related Item: Notice 2009-11PDF, Brokers May Furnish Certain Composite Annual Tax Reporting Statements by February 17, 2009
Subscribe to IRS Newswire
IR-2009-7, Jan. 21, 2009
Washington — The Internal Revenue Service announced today that taxpayers in Delaware, Illinois, New York and Rhode Island who file paper income tax returns will send them to different processing centers this year.
Taxpayers in Delaware, New York and Rhode Island will now send their tax returns to the IRS Kansas City Service Center in Kansas City, Mo. Taxpayers in Illinois will now send their tax returns to the IRS Fresno Service Center, in Fresno, Calif.
The IRS continuously monitors work flow at its centers and makes appropriate adjustments by altering the volume of returns to be sent to each. Taxpayers who use the envelope provided with the income tax instructions do not have to be concerned with the address change, their returns automatically will go to the correct center.
Taxpayers who e-file will not be affected by the address changes. The majority of filers choose IRS e-file; it’s faster, easier, more accurate and more convenient than filing a paper tax return.
For taxpayers who file paper returns, the correct center addresses are on labels inside the tax packages they receive in the mail. Taxpayers who do not receive a package and need the service center address should refer to the back cover of the instructions to Forms 1040PDF, 1040APDF and 1040EZPDF.
 
Subscribe to IRS Newswire
IR-2009-6, Jan. 15, 2009
WASHINGTON — The Internal Revenue Service will join national TV network Telemundo in an informative tax program aimed at Spanish-speaking taxpayers on Sunday, Jan. 25.
The one-hour program, “Los Impuestos y Usted” (“Taxes and You”), will air at:
3 p.m. Eastern, Central and Pacific Time
2 p.m. Mountain Time
Consult your local listings for exact times.
“Los Impuestos y Usted” will focus on a variety of tax issues, including topics such as who must file a tax return and who can claim deductions and benefits. 
In addition the program will highlight the Earned Income Tax Credit, which is a sometimes overlooked but valuable tax credit that can make taxpayers lives a little easier.   Working families with incomes under $41,646 could receive larger refunds if they qualify for the EITC.
The program also will explain Free File, a service that allows many taxpayers to file their taxes online at no cost. The show will also discuss other kinds of free assistance available from the IRS.
Mónica Noguera, host for many of Telemundo’s special programs, will present the IRS program, which features in-studio interviews with IRS tax experts.
Information about the IRS is available in Spanish at /espanol or toll-free at 1-800-829-1040, extension 8.
Subscribe to IRS Newswire
IR-2009-4, Jan. 13, 2009              
WASHINGTON – The Internal Revenue Service is offering a daily series of Tax Tips for the 2009 federal tax filing season that began this month.
Tax Tips offer concise, useful information on topics affecting millions of taxpayers.   More than 70 tips on federal taxes will be available with a new one for each business day until the April 15 tax filing deadline.
Tips are available as easy-to-understand text as well as several audio files for podcast.
Sample text-based Tax Tip topics include:
Choosing a tax preparer
Where you can get free tax help
How e-file can make filing easier and getting you your refund faster
How to file for an extension or to amend your return
What tax records to keep
First-Time Homebuyer Credit
Taxpayers can receive new text-based Tax Tips via email when they are published by subscribing through the e-News Subscriptions page on IRS.gov.  When subscribing, the taxpayer will receive a confirmation message by e-mail that he or she must respond to in order to confirm the subscription.   Other list serves available on IRS.gov include Guidewire, which distributes IRS guidance, and Newswire, which distributes IRS press releases.
Subscribe to IRS Newswire
IR-2009-1, Jan. 5, 2009
WASHINGTON — The Internal Revenue Service today announced the selection of four new members of the Internal Revenue Service Advisory Council (IRSAC), which provides an organized public forum for IRS officials and representatives of the public to discuss key tax administration issues.
“IRSAC plays a key role in making our tax system work better,” said Frank Keith, IRS Communications & Liaison chief. “The membership offers thoughtful and valuable advice, and these new members will bring worthwhile perspectives to the Council.”
Members are selected to represent the taxpaying public, tax professionals, small and large businesses, state tax administrations and the payroll community. The council provides the IRS commissioner and division leadership with important feedback, observations and suggestions.
IRSAC meets periodically and will submit a report to the agency in November 2009 at a public meeting. IRSAC members generally serve a two- to three-year term with a possible one-year extension. The four new participants will join 26 returning members in 2009.
The new members are:
Michael Casey, J.D., MAAT, CPP, EA, ATP of Flagstaff, Ariz. Casey is an accountant with West, Christensen, P.C., and serves as the American Payroll Association chapter government liaison officer. He is also an associate professor at Coconino Community College.
Robert E. McKenzie, J.D., of Chicago, Ill. McKenzie is a partner with the law firm of Arnstein & Lehr, LLP, and has been selected for listing by Law and Leading Attorneys. He is the author of “Representation before the Collection Division of the IRS” and coauthor of “Representing the Audited Taxpayer before the IRS.”
Joni K. Terens, EA, of Tustin, Calif. Terens is the President of Accurate Bookkeeping & Tax Service Inc. She teaches IRS small business seminars, Volunteer Income Tax Assistance (VITA) classes and Federal Emergency Management Agency (FEMA) workshops. In addition, she specializes in tax issues for the military.
Madeleine Savage-Townes, J.D., of Memphis, Tenn. Townes is currently a tax manager with NYK Logistics (Americas) Inc. She specializes in turning around underperforming operations and start-up opportunities, building key alliances and implementing quality control management systems.
Visit the Tax Professionals page of this web site for more on IRSAC.
Subscribe to IRS Newswire
IR-2009-15, Feb. 26, 2009
WASHINGTON — The Internal Revenue Service today released new detailed information that will help employers claim credit for the COBRA medical premiums they pay for their former employees.
The IRS unveiled new information on this Web site, IRS.gov, that includes an extensive set of questions and answers for employers. In addition, the Web site contains a revised version of the quarterly payroll tax return that employers will use to claim credit for the COBRA medical premiums they pay for their former employees.
Form 941PDF, Employer’s Quarterly Federal Tax Return, will also be sent to about 2 million employers in mid-March. The form is used to claim the new COBRA premium assistance payments credit, beginning with the first quarter of 2009.
“This is the first step in our effort to provide employers with information on this important health benefit for people who have lost their jobs,” said IRS Commissioner Doug Shulman. “We will continue our work in the weeks ahead to help employers implement this crucial change for the nation’s unemployed.”
The American Recovery and Reinvestment Act of 2009, which became law last week, includes changes to the health benefit provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985, commonly referred to as COBRA. The new law will affect former employees and their families, employers and others involved in providing COBRA coverage.
Under the new law, eligible former employees, enrolled in their employer’s health plan at the time they lost their jobs, are required to pay only 35 percent of the cost of COBRA coverage. Employers must treat the 35 percent payment by eligible former employees as full payment, but the employers are entitled to a credit for the other 65 percent of the COBRA cost on their payroll tax return.
Employers must maintain supporting documentation for the credit claimed. This includes:

Documentation of receipt of the employee’s 35 percent share of the premium.


In the case of insured plans: A copy of invoice or other supporting statement from the insurance carrier and proof of timely payment of the full premium to the insurance carrier.


Declaration of the former employee’s involuntary termination.

COBRA provides certain former employees, retirees, spouses, former spouses and dependent children the right to temporary continuation of health coverage at group rates. COBRA generally covers health plans maintained by private-sector employers with 20 or more full and part-time employees. It also covers employee organizations or federal, state or local governments. It does not apply to churches and certain religious organizations. The new COBRA subsidy provisions also apply to insurers required to offer continuation coverage under state law similar to the federal COBRA.
More information about COBRA payments and the new law is available on www.dol.gov.
NOTE: The 2009 Worker, Homeownership and Business Assistance Act and the American Recovery and Reinvestment Act  updated the first-time homebuyer tax credit.
IR-2009-14, Feb. 25, 2009
WASHINGTON — The Internal Revenue Service announced today that taxpayers who qualify for the first-time homebuyer credit and purchase a home this year before Dec. 1 have a special option available for claiming the tax credit either on their 2008 tax returns due April 15 or on their 2009 tax returns next year.
Qualifying taxpayers who buy a home this year before Dec. 1 can get up to $8,000, or $4,000 for married filing separately.
“For first-time homebuyers this year, this special feature can put money in their pockets right now rather than waiting another year to claim the tax credit," said IRS Commissioner Doug Shulman. “This important change gives qualifying homebuyers cash they do not have to pay back.”
The IRS has posted a revised version of Form 5405, First-Time Homebuyer Credit, on IRS.gov. The revised form incorporates provisions from the American Recovery and Reinvestment Act of 2009. The instructions to the revised Form 5405 provide additional information on who can and cannot claim the credit, income limitations and repayment of the credit.
This year, qualifying taxpayers who buy a home before Dec. 1, 2009, can claim the credit on either their 2008 or 2009 tax returns. They do not have to repay the credit, provided the home remains their main home for 36 months after the purchase date. They can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately.
The amount of the credit begins to phase out for taxpayers whose adjusted gross income is more than $75,000, or $150,000 for joint filers.
For purposes of the credit, you are considered to be a first-time homebuyer if you, and your spouse if you are married, did not own any other main home during the three-year period ending on the date of purchase.
The IRS also alerted taxpayers that the new law does not affect people who purchased a home after April 8, 2008, and on or before Dec. 31, 2008. For these taxpayers who are claiming the credit on their 2008 tax returns, the maximum credit remains 10 percent of the purchase price, up to $7,500, or $3,750 for married individuals filing separately. In addition, the credit for these 2008 purchases must be repaid in 15 equal installments over 15 years, beginning with the 2010 tax year.
Subscribe to IRS Newswire
Update July 3, 2014 — Publication 15-T has been obsoleted.
IR-2009-13, Feb 21, 2009
WASHINGTON ― The Internal Revenue Service today released new withholding tables that will result in more take-home pay this spring for millions of American workers.
The new tables incorporate the new Making Work Pay credit, one of the key tax provisions included in the American Recovery and Reinvestment Act of 2009 that became law earlier this week.
“For most taxpayers, the additional credit will automatically start showing up in their paychecks this spring,” said IRS Commissioner Doug Shulman. “Since employers and payroll companies will handle this change, people typically won’t need to take any additional action. The IRS will continue working to implement this and other provisions of the new law as quickly as possible.”
The new withholding tablesPDF, along with other instructions related to the new tax law, will be incorporated in new Publication 15-T. This publication will be posted to this Web site next week and mailed to more than 9 million employers in mid-March. The IRS asks that employers start using these new tables as soon as possible but not later than April 1. Most workers will see a boost in their take-home pay soon thereafter.
Eligible workers will get the benefit of this change without any action on their part. This means that workers don’t need to fill out a new W-4 withholding form to get the Making Work Pay credit reflected in their take-home pay. A Form W-4 will not need to be submitted for the automatic withholding change. Individuals and couples with multiple jobs may want to consult the IRS withholding calculator and submit revised Form W-4PDF to ensure enough withholding is held to cover the tax for the combined income. Publication 919 provides additional guidance for tax withholding.
Available for tax years 2009 and 2010, the Making Work Pay credit is 6.2 percent of a taxpayer’s earned income with a maximum credit of $800 for a married couple filing a joint return and $400 for other taxpayers, but it is phased out for higher income taxpayers. Most workers will qualify for the maximum credit. Because the credit is refundable (people can get it even if they owe no tax), most low-income workers will also qualify for the full credit.
Though all eligible taxpayers will need to claim the credit when they file their 2009 income tax return next year, the benefit will generally be spread out over the paychecks they receive beginning this spring and continue until the end of the year.
Many higher-income taxpayers will see little or no change in their take-home pay. That’s because the Making Work Pay credit is phased out for a married couple filing a joint return whose modified adjusted gross income (AGI) is between $150,000 and $190,000 and other taxpayers whose modified AGI is between $75,000 and $95,000.
Taxpayers will not get a separate, special check mailed to them from the IRS like last year’s economic stimulus payment.
IR-2009-12, Feb. 2, 2009
WASHINGTON — The Internal Revenue Service is accepting applications to fill vacancies on the Electronic Tax Administration Advisory Committee. The committee members provide the IRS with constructive observations about current or proposed policies, programs and procedures in electronic tax administration.
Applicants should submit a resume and complete an application formPDF by April 3, 2009. A notice in the Federal Register contains more details about the committee and application process.
The ETAAC provides an organized public forum for the discussion of issues in electronic tax administration. The ETAAC supports the overriding goal that paperless filing should be the preferred and most convenient method of filing tax and information returns. The ETAAC's members are approved by the Secretary of the Treasury and serve a three-year term. Each June, the ETAAC submits an annual report to Congress about the IRS’ progress with electronic transactions.
Membership will include tax practitioners and preparers, transmitters of electronic returns, tax software developers, large and small businesses, employers, payroll service providers, financial industry representatives, system integrators (technology providers) and academics (marketing, sales and technical perspectives).
Requests for more information or completed applications should be sent to etaac@irs.gov or faxed to 202-283-2845. This is not a toll-free number.
Related Item: ETAAC Application FormPDF
Subscribe to IRS Newswire
IR-2009-30, March 30, 2009
WASHINGTON — The Internal Revenue Service announced today that taxpayers who buy a new passenger vehicle this year may be entitled to deduct state and local sales and excise taxes paid on the purchase on their 2009 tax returns next year.
“For those thinking about buying a new car this year, this deduction may give them a little more drive to make their purchase this year,” said IRS Commissioner Doug Shulman. “This deduction enables taxpayers to buy now and get cash back later on their tax returns.”
The deduction is limited to the state and local sales and excise taxes paid on up to $49,500 of the purchase price of a qualified new car, light truck, motor home or motorcycle.
The amount of the deduction is phased out for taxpayers whose modified adjusted gross income is between $125,000 and $135,000 for individual filers and between $250,000 and $260,000 for joint filers.
IRS also alerted taxpayers that the vehicle must be purchased after Feb. 16, 2009, and before Jan. 1, 2010, to qualify for the deduction.
The special deduction is available regardless of whether a taxpayer itemizes deductions on their return. The IRS reminded taxpayers the deduction may not be taken on 2008 tax returns.
Related Item: IR-2009-60, Special Tax Break on New Car Purchases Available in States With No Sales Tax
Subscribe to IRS Newswire
IR-2009-29, March 26, 2009
WASHINGTON — All or part of unemployment benefits received in 2009 will be tax free for many unemployed workers, according to the Internal Revenue Service.
“This morning we learned that a record 5.6 million people were receiving unemployment benefits in the middle of March. This underscores the need for the relief provided by the American Recovery and Reinvestment Act, which includes making the first $2,400 of unemployment insurance exempt from tax,” said IRS Commissioner Doug Shulman. “I urge all unemployed workers to take this special tax break into account as they plan their tax withholding and quarterly estimated tax payments for the year. This change offers a helping hand to millions of Americans who are out of work and struggling to make ends meet.”
Under the American Recovery and Reinvestment Act, enacted last month, every person who receives unemployment benefits during 2009 is eligible to exclude the first $2,400 of these benefits when they file their tax return next year. For a married couple, the exclusion applies to each spouse, separately. Thus, if both spouses receive unemployment benefits during 2009, each may exclude from income the first $2,400 of benefits they receive.
The new law doesn’t affect the return taxpayers are filling out now. Unemployment benefits received in 2008 and prior years remain fully taxable.
Unemployed workers can choose to have income tax withheld from their unemployment benefit payments. Withholding on these payments is voluntary. However, choosing this option may help avoid a surprise year-end tax bill or a possible penalty for having paid too little tax during the year. Those who choose this option will have a flat 10 percent tax withheld from their benefits.
Unemployed workers who expect to receive more than $2,400 in benefits this year should consider having tax withheld from their benefit payments in excess of that amount. Those unemployed workers who have already chosen to have tax taken out of their benefits, should consider the $2,400 exclusion in determining whether to continue to have tax withheld.
Use Form W-4V, Voluntary Withholding Request, or the equivalent form provided by the payer to request withholding to begin or end. Form W-4V is also available on IRS.gov or by calling the IRS toll-free at 1-800-TAX-FORM (829-3676).
Related Items:

IRS Information Related to the American Recovery and Reinvestment Act of 2009

 
Subscribe to IRS Newswire
IR-2009-28, March 24, 2009
WASHINGTON — The Internal Revenue Service seeks civic-minded volunteers to serve on the Taxpayer Advocacy Panel (TAP), which listens to taxpayers, identifies key issues and makes recommendations for improving IRS service.
“TAP members are your friends and neighbors, walking in the shoes of the average taxpayer. A better understanding of how to serve the taxpayer well is a key to sound tax administration,” said Doug Shulman, IRS Commissioner.
TAP provides a forum for taxpayers from all 50 states as well as the District of Columbia and Puerto Rico. TAP is a federal advisory committee that reports annually to the Treasury Department, the IRS and the Office of the Taxpayer Advocate, which is an independent organization within the IRS. The Office of the Taxpayer Advocate provides oversight and funding of TAP.
“As the IRS continues to examine taxpayers’ needs in the area of service, the Taxpayer Advocacy Panel has emerged as a vital source for gathering and providing information from the perspective of taxpayers,” said Nina E. Olson, National Taxpayer Advocate. “TAP’s role will ultimately aid taxpayers by helping the IRS to provide them with the top quality service they deserve."
To be a member of TAP you must be a U.S. citizen, current with your tax obligations, able to commit 300 to 500 hours during the year and pass an FBI criminal background check.  New TAP members will serve a three-year term starting in December 2009. Anyone chosen as an alternate would be considered to fill any vacancies that open during the next two years.
TAP members are being sought for the following states: Arkansas, California, Connecticut, Florida, Georgia, Illinois, Kentucky, Maryland, Minnesota, Missouri, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Tennessee and Texas.
Alternates are being sought for: Alaska, Arizona, Delaware, District of Columbia, Hawaii, Idaho, Indiana, Kansas, Massachusetts, Michigan, Montana, Nebraska, Nevada, New Hampshire, Puerto Rico, South Dakota, Vermont, Virginia, West Virginia and Wyoming.
Applications to become a member of TAP will be accepted until April 30. Applications are available online at www.improveirs.org. Applications can also be received through the mail by calling toll-free 1-888-912-1227.
Subscribe to IRS Newswire
IR-2009-24, March 13, 2009
WASHINGTON — In an effort to improve its communications with taxpayers, the Internal Revenue Service will eliminate the nearly dozen inserts that go into a notice informing businesses that they owe additional tax.
The change to the CP 161 notice, which is mailed to business taxpayers who underpay their taxes, is part of an ongoing agency review of how it communicates with its 240 million taxpayers. This initial step will halt tens of millions of pieces of paper, reduce burden and save on expenses.
“We send out millions of pieces of correspondence each year such as letters and notices. It is critically important that we continuously improve the clarity and effectiveness of this communication,” said Doug Shulman, IRS Commissioner.
There are more than 2.3 million of these notices generated each year. Each notice contains as many as 13 inserts, and has been a source of complaints from both taxpayers and tax professionals. Although, the intent of the many inserts was to anticipate and answer taxpayer questions, field tests indicated the inserts made little difference.
As of March 9, the CP 161 notice will contain only two inserts: Publication 1, Your Rights as a Taxpayer, and a return envelope for the tax payment. The IRS will monitor the slimmer correspondence to determine whether additional changes are needed.
Subscribe to IRS Newswire
IR-2009-23, March 13, 2009
WASHINGTON — Taxpayers are e-filing their Federal income tax returns from their home computers in record numbers this year the IRS announced today. As of March 6, more than 18 million income tax returns were filed from home computers, up 20 percent compared to the same time last year.
So far this year, almost 52 million tax returns have been e-filed, up 6 percent compared to the same time last year. However, the number of people using IRS Free File has fallen from almost 3 million last year to just under 2 million for the same time this year, a reduction of about 30 percent. A number of factors could be causing the decrease in Free File volumes, including national advertising of other free online tax preparation offers and the elimination of electronic filing fees by some software providers.
As of March 6, about 91 percent of tax returns resulted in a refund. This percentage however is usually at its highest at the start of the filing season because taxpayers expecting refunds usually file earlier than taxpayer who must make a payment. 
The IRS cautioned that year-to-year analysis of total returns file will be an anomaly this year because last year’s results include those returns filed for the economic stimulus payment. As the year progresses, the IRS expects to receive and process more individual income tax returns during 2009 than in 2007 but fewer than in 2008.
Subscribe to IRS Newswire

2009 FILING SEASON STATISTICS


Cumulative through the weeks ending Mar. 7, 2008 and Mar. 6, 2009


Individual Income Tax Returns


2008


2009


% Change


Total Receipts


  63,383,000


63,851,000


  0.7%


Total Processed


  59,270,000


  59,763,000


  0.8%


 


 


 


 


E-filing Receipts:


 


 


 


TOTAL


48,795,000


51,793,000


  6.1%


Tax Professionals


33,419,000


33,349,000


-0.2%


Self-prepared


15,377,000


18,444,000


19.9%


 


 


 


 


Web Usage:


 


 


 


Visits to IRS.gov


90,729,850 


116,774,933 


28.7% 


 


 


 


 


Total Refunds:


 


 


 


Number


  53,176,000


  54,638,000


  2.7%


Amount


$136.976


Billion


$153.579


Billion


12.1%


Average refund


$2,576


$2,811


9.1%


 


 


 


 


Direct Deposit Refunds:


 


 


 


Number


41,665,000


44,744,000


7.4%


Amount


$117.808


Billion


$135.613


Billion


15.1%


Average refund


$2,827


$3,031


7.2%
IR-2009-22, March 13, 2009
WASHINGTON — The Internal Revenue Service (IRS) today announced the release of the 2008 IRS Data Book, which is an annual snapshot of IRS activities for a given fiscal year.
The report describes activities conducted by the IRS from Oct. 1, 2007, to Sept. 30, 2008, and includes information about returns filed, tax collections, enforcement and taxpayer assistance, as well as the IRS budget and workforce.
During fiscal year 2008, the IRS collected more than $2.3 trillion in taxes (net of refunds) and processed more than 250 million returns. More than 101 million returns, including 58 percent of individual income tax returns, were filed electronically.
More than 118 million individual income tax return filers received tax refunds that totaled almost $270.4 billion. Filers also received more than $95.7 billion in economic stimulus payments. In fiscal year 2008, IRS spent an average of 41 cents to collect each $100 of tax revenue.
The 2008 IRS Data Book has been posted on IRS.gov.
Printed copies of the IRS Data Book, Publication 55B, will be available by mid-April 2009 from the U.S. Government Printing Office. To obtain a copy, write to the Superintendent of Documents, P.O. Box 371954, Pittsburgh, PA 15250-7954, or call (202) 512-1800 for voicemail, or fax a request to (202) 512-2250.
Subscribe to IRS Newswire
IR-2009-21, March 11, 2009
WASHINGTON — The Internal Revenue Service today announced that interest rates for the calendar quarter beginning April 1, 2009, will drop by one percentage point.  The new rates will be: 
 
• four (4) percent for overpayments [three (3) percent in the case of a corporation];
• four (4) percent for underpayments;
• six (6) percent for large corporate underpayments; and
• one and one-half (1.5) percent for the portion of a corporate overpayment exceeding $10,000.
Under the Internal Revenue Code, the rate of interest is determined on a quarterly basis.  For taxpayers other than corporations, the overpayment and underpayment rate is the federal short-term rate plus 3 percentage points.  Generally, in the case of a corporation, the underpayment rate is the federal short-term rate plus 3 percentage points and the overpayment rate is the federal short-term rate plus 2 percentage points.  The rate for large corporate underpayments is the federal short-term rate plus 5 percentage points.  The rate on the portion of a corporate overpayment of tax exceeding $10,000 for a taxable period is the federal short-term rate plus one-half (0.5) of a percentage point.
The interest rates announced today are computed from the federal short-term rate during January 2009 to take effect February 1, 2009, based on daily compounding.
The rate for determining the addition to tax for failure to pay estimated tax for the first 15 days in April 2009 is the 5 percent rate that applied to underpayments of tax during the first calendar quarter in 2009.
Revenue Ruling 2009-7PDF, announcing the new rates of interest, is attached and will appear in Internal Revenue Bulletin No. 2009-13, dated March 30, 2009.
Subscribe to IRS Newswire
IR-2009-20, March 6, 2009
WASHINGTON — Taxpayers are filing earlier and receiving larger refunds so far this year, according to early filing season statistics released today by the Internal Revenue Service.
As of Feb. 27, 2009, the IRS had received 56 million individual tax returns, a slight increase over the previous year. And, the average individual refund was $2,869, a 9 percent increase or $232 more than the same time last year.
The IRS notes that possible reasons for the larger refunds may include taxpayers benefiting from the recovery rebate credit and other tax breaks such as the first-time homebuyer credit and the additional standard deduction for real estate taxes. The average refund amount generally will decrease slightly as the filing season progresses.
More taxpayers choose to receive their refunds through direct deposit each year. As of Feb. 27, more than 84 percent of all refunds were issued through direct deposit, up from 81 percent for the same period last year.
While the IRS has issued almost 3 percent more refunds this year compared to the same time last year, the number of taxpayers who choose to receive their refunds quickly and safely through direct deposit is up almost 7 percent compared to the same time last year. On Feb. 27, the average direct deposit refund totaled $3,063.  
The IRS cautioned that year-to-year analysis of total returns filed will be an anomaly this year because last year’s results include those returns filed for the economic stimulus payment. As the year progresses, the IRS expects to receive and process more individual income tax returns during 2009 than in 2007 but fewer than in 2008.
Subscribe to IRS Newswire
 
 

2009 FILING SEASON STATISTICS
 


Cumulative through the weeks ending Feb. 29, 2008 and Feb. 27, 2009 
 


Individual Income Tax Returns


  2008 


2009 


% Change


Total Receipts


  55,704,000


56,049,000


  0.6%


Total Processed


  51,240,000


  51,939,000


  1.4%


 


 


 


 


E-filing Receipts:


 


 


 


TOTAL


43,777,000


46,246,000


  5.6%


Tax Professionals


29,750,000


29,606,000


-0.5%


Self-prepared


14,027,000


16,640,000


18.6%


 


 


 


 


Web Usage:


 


 


 


Visits to IRS.gov


80,312,322 


105,204,812 


30.99%


 


 


 


 


Total Refunds:


 


 


 


Number


  46,539,000


  47,697,000


  2.5%


Amount


$122.716


Billion


$136.847


Billion


11.5%


Average refund


$2,637


$2,869


8.8%


 


 


 


 


Direct Deposit Refunds:


 


 


 


Number


37,748,000


40,257,000


6.6%


Amount


$107.955


Billion


$123.297


Billion


14.2%


Average refund


$2,860


$3,063


7.1%
IRS Employees More Flexible, More Cost Effective
IR-2009-19, March 5, 2009
WASHINGTON — After conducting an extensive review of the private debt collection program, including the cost effectiveness of the effort, the Internal Revenue Service will not renew its contracts with two private debt collection agencies, the agency announced today.
The IRS determined that the work is best done by IRS employees who have more flexibility handling cases, which is particularly important with many taxpayers currently facing economic hardship.
The current one-year contracts expire Friday.
“After a thorough review of this program, I have decided not to renew the contracts,” IRS Commissioner Doug Shulman said. “I believe this work is best done by IRS employees, and I believe we have strong support from the Administration and the Congress for increased IRS enforcement resources going forward.”
Shulman also noted that the IRS anticipates hiring over 1,000 new collection personnel in FY 2009. These new employees would give the IRS the flexibility to make assignments based on the areas of greatest need rather than filtering which cases can be worked using contractor resources.
Shulman cited the results of a cost-effectiveness study of the private debt collection program. The study – supported by an independent review -- showed that it is reasonable to conclude that when working similar inventory, IRS collection is more cost effective than the contractors.
IRS employees have a range of options available to them in attempting to resolve difficult collection cases that, by law, the private contractors do not have.
“In these challenging economic times, I have asked all IRS employees to go the extra mile to help financially distressed taxpayers,” Shulman said. “IRS employees have more options available to them to resolve difficult collection cases.”
Shulman also said that the decision was in no way based on concerns over the performance of the two contractors affected, who performed according to the terms of the contract throughout. “I have asked IRS officials to ensure that the ramp down is orderly, and that the IRS perform targeted outreach to any displaced contractor employees that would consider applying for positions at the IRS,” Shulman said.
“By investing in IRS employees to perform this collection work, we can be assured that we have all the tools available for helping taxpayers confronting complex situations,” Shulman said.
Subscribe to IRS Newswire