Datasets:

etrent17

/

irs-articles

like 1

https://www.irs.gov/newsroom/treasury-irs-release-latest-state-by-state-economic-impact-payment-figures

IR-2020-91, May 8, 2020 WASHINGTON — The Treasury Department and the Internal Revenue Service today released updated state-by-state figures for Economic Impact Payments, with approximately 130 million individuals receiving payments worth more than $200 billion in the program's first four weeks. "We are working hard to continue delivering these payments to Americans who need them," said IRS Commissioner Chuck Rettig. "The vast majority of payments have been delivered in record time, and millions more are on the way every week. We encourage people to visit IRS.gov for the latest information, FAQs and updates on the payments." More than 150 million payments will be sent out, and millions of people who do not typically file a tax return are eligible to receive these payments. Payments are automatic for people who filed a tax return in 2018 or 2019, receive Social Security retirement, survivor or disability benefits (SSDI), Railroad Retirement benefits, as well as Supplemental Security Income (SSI) and Veterans Affairs beneficiaries who didn't file a tax return in the last two years. For those who don't receive federal benefits and didn't have a filing obligation in 2018 or 2019, the IRS continues to encourage them to visit the Non-Filer tool at IRS.gov so they can quickly register for Economic Impact Payments. People can continue to receive their payment throughout the year.   Economic Impact Payments, totals by State. State State postal code Number of EIP Payments Total Amount of EIP Payments Alabama AL 1,996,007  $                       3,428,443,628 Alaska AK 277,432  $                          486,006,748 Arkansas AR 1,216,253  $                       2,128,987,406 Arizona AZ 2,734,978  $                       4,712,311,770 California CA 13,564,730  $                     22,465,995,771 Colorado CO 2,141,841  $                       3,618,352,193 Connecticut CT 1,325,813  $                       2,162,539,412 Delaware DE 385,599  $                          646,913,592 District of Columbia DC 252,095  $                          349,400,662 Florida FL 9,169,713  $                     15,173,922,832 Georgia GA 4,069,403  $                       6,937,057,497 Hawaii HI 542,426  $                          923,960,321 Iowa IA 1,230,814  $                       2,212,426,465 Idaho ID 672,496  $                       1,255,712,382 Illinois IL 4,844,140  $                       8,169,566,380 Indiana IN 2,742,791  $                       4,855,661,708 Kansas KS 1,098,473  $                       1,980,223,913 Kentucky KY 1,878,814  $                       3,282,818,708 Louisiana LA 1,877,721  $                       3,180,135,799 Maine ME 594,555  $                       1,005,363,003 Maryland MD 2,186,404  $                       3,575,993,478 Massachusetts MA 2,503,206  $                       4,008,005,049 Michigan MI 4,081,884  $                       7,045,417,642 Minnesota MN 2,124,142  $                       3,714,368,466 Missouri MO 2,482,825  $                       4,337,599,739 Mississippi MS 1,225,834  $                       2,086,932,244 Montana MT 433,767  $                          759,469,674 Nebraska NE 743,803  $                       1,349,417,300 Nevada NV 1,279,890  $                       2,131,071,471 New Hampshire NH 560,833  $                          941,099,188 New Jersey NJ 3,208,179  $                       5,287,240,934 New Mexico NM 851,449  $                       1,442,523,522 New York NY 7,737,476  $                     12,523,017,409 North Carolina NC 4,076,334  $                       6,985,338,563 North Dakota ND 287,210  $                          510,578,907 Ohio OH 4,916,174  $                       8,322,111,961 Oklahoma OK 1,556,747  $                       2,777,598,152 Oregon OR 1,658,586  $                       2,782,872,801 Pennsylvania PA 5,215,824  $                       8,821,284,132 Rhode Island RI 446,941  $                          725,567,957 South Carolina SC 2,060,588  $                       3,522,197,950 South Dakota SD 343,860  $                          625,042,408 Tennessee TN 2,881,709  $                       4,980,110,718 Texas TX 10,728,541  $                     18,796,209,760 Utah UT 1,075,546  $                       2,091,334,753 Vermont VT 267,295  $                          450,251,509 Virginia VA 3,196,178  $                       5,456,000,257 Washington WA 2,856,962  $                       4,875,983,730 West Virginia WV 784,111  $                       1,363,560,122 Wisconsin WI 2,307,675  $                       4,025,320,018 Wyoming WY 225,830  $                          407,690,034 Foreign addresses   595,548 $                           977,830,929 Economic Impact Payment help available on IRS.gov IRS.gov has a variety of tools and resources available to help individuals and businesses navigate Economic Impact Payments and get the information they need about EIP and other CARES Act provisions. Economic Impact Payment FAQs: The IRS is seeing a variety of questions about Economic Impact Payments, ranging from eligibility to timing. These FAQs provide an overview and are updated frequently. Taxpayers should check the FAQs often for the latest additions; many common questions are answered on IRS.gov already, and more are being developed.

https://www.irs.gov/newsroom/irs-provides-guidance-for-estates-and-trusts-for-itemizing-deductions

IR-2020-90, May 7, 2020 WASHINGTON — The Internal Revenue Service today issued proposed regulations that provide guidance for estates and trusts clarifying that certain deductions of estates and non-grantor trusts are not miscellaneous itemized deductions. The Tax Cuts and Jobs Act (TCJA) prohibits individual taxpayers from claiming miscellaneous itemized deductions for any taxable year beginning after December 31, 2017, and before January 1, 2026. Specifically, the proposed regulations clarify the following deductions are allowable in figuring adjusted gross income and are not miscellaneous itemized deductions: Costs paid or incurred in connection with the administration of the estate or trust which would not have been incurred otherwise. Deductions concerning the personal exemption of an estate or non-grantor trust. Deductions for trusts distributing current income. Deductions for trusts accumulating income Finally, the guidance clarifies how to determine the character, amount and manner for allocating excess deductions that beneficiaries succeeding to the property of a terminated estate or non-grantor trust may claim on their individual income tax returns. For more information about this and other TCJA provisions, visit IRS.gov/taxreform.

https://www.irs.gov/newsroom/irs-three-new-credits-are-available-to-many-businesses-hit-by-covid-19

IR-2020-89, May 7, 2020 WASHINGTON — The Internal Revenue Service today reminds employers affected by COVID-19 about three important new credits available to them. Employee Retention Credit: The employee retention credit is designed to encourage businesses to keep employees on their payroll. The refundable tax credit is 50% of up to $10,000 in wages paid by an eligible employer whose business has been financially impacted by COVID-19. The credit is available to all employers regardless of size, including tax-exempt organizations. There are only two exceptions: State and local governments and their instrumentalities and small businesses who take small business loans. Qualifying employers must fall into one of two categories: The employer's business is fully or partially suspended by government order due to COVID-19 during the calendar quarter. The employer's gross receipts are below 50% of the comparable quarter in 2019. Once the employer's gross receipts go above 80% of a comparable quarter in 2019, they no longer qualify after the end of that quarter. Employers will calculate these measures each calendar quarter. Paid Sick Leave Credit and Family Leave Credit: The paid sick leave credit is designed to allow business to get a credit for an employee who is unable to work (including telework) because of Coronavirus quarantine or self-quarantine or has Coronavirus symptoms and is seeking a medical diagnosis. Those employees are entitled to paid sick leave for up to 10 days (up to 80 hours) at the employee's regular rate of pay up to $511 per day and $5,110 in total. The employer can also receive the credit for employees who are unable to work due to caring for someone with Coronavirus or caring for a child because the child's school or place of care is closed, or the paid childcare provider is unavailable due to the Coronavirus. Those employees are entitled to paid sick leave for up to two weeks (up to 80 hours) at 2/3 the employee's regular rate of pay or, up to $200 per day and $2,000 in total.  Employees are also entitled to paid family and medical leave equal to 2/3 of the employee's regular pay, up to $200 per day and $10,000 in total. Up to 10 weeks of qualifying leave can be counted towards the family leave credit. Employers can be immediately reimbursed for the credit by reducing their required deposits of payroll taxes that have been withheld from employees' wages by the amount of the credit. Eligible employers are entitled to immediately receive a credit in the full amount of the required sick leave and family leave, plus related health plan expenses and the employer's share of Medicare tax on the leave, for the period of April 1, 2020, through Dec. 31, 2020. The refundable credit is applied against certain employment taxes on wages paid to all employees. How will employers receive the credit? Employers can be immediately reimbursed for the credit by reducing their required deposits of payroll taxes that have been withheld from employees' wages by the amount of the credit. Eligible employers will report their total qualified wages and the related health insurance costs for each quarter on their quarterly employment tax returns or Form 941 beginning with the second quarter. If the employer's employment tax deposits are not sufficient to cover the credit, the employer may receive an advance payment from the IRS by submitting Form 7200, Advance Payment of Employer Credits Due to COVID-19. Eligible employers can also request an advance of the Employee Retention Credit by submitting Form 7200. The IRS has also posted Employee Retention Credit FAQs and Paid Family Leave and Sick Leave FAQs that will help answer questions. Updates on the implementation of the Employee Retention Credit and other information can be found on the Coronavirus page of IRS.gov. Related Items: FS-2020-05, New Employee Retention Credit helps employers keep employees on payroll    

https://www.irs.gov/newsroom/irs-seeking-applications-for-tce-and-vita-grants

IR-2020-88, May 6, 2020 WASHINGTON — The Internal Revenue Service is accepting applications for the Tax Counseling for the Elderly (TCE) and Volunteer Income Tax Assistance (VITA) grant programs, which will allow some organizations to apply for annual funding for up to three years. Applications will be accepted through June 1, 2020, on grants.gov. The application packages and guidelines are available on the IRS website. For the 2020 filing season, the IRS awarded 27 TCE grantees $11 million and 238 VITA grantees $18 million. Last year, the two grant programs filed nearly 3 million returns at almost 9,000 sites nationwide. The TCE program was established in 1978 to provide tax counseling and return preparation to persons age 60 or older and to give training and technical assistance to the volunteers who provide free federal income tax assistance within elderly communities across the nation. For more information on the TCE program visit the TCE webpage on IRS.gov. The VITA Grant program was established in 2007 to supplement the VITA program, which was created in 1969. VITA provides underserved communities with free tax filing assistance. The grant program enables VITA partners to extend services to underserved populations in the hardest-to-reach urban and non-urban areas, to increase the capacity of targeted taxpayers to file returns electronically, to enhance training of volunteers and to maintain the high accuracy rate of returns prepared at VITA sites. For more information on the VITA Grant program, visit the VITA Grant webpage on IRS.gov. More information: Applying for a TCE grant Publication 4671, VITA Grant Program Overview and Application InstructionsPDF Applying for a VITA grant Publication 1101, Application Package and Guidelines for Managing a TCE ProgramPDF

https://www.irs.gov/newsroom/irs-retools-settlement-days-program-in-response-to-covid-19-pandemic-allows-unrepresented-taxpayers-to-settle-their-cases-virtually-and-reach-finality

IR-2020-87, May 5, 2020 WASHINGTON – The Internal Revenue Service Office of Chief Counsel today announced the Settlement Days program will continue remotely enabling unrepresented taxpayers to work towards resolving their pending United States Tax Court case despite "stay-at-home" orders in many jurisdictions.  The first two events are for docketed cases with place of trial in Detroit or Atlanta.  Future events may be scheduled in other cities throughout the United States. Virtual Settlement Days is a coordinated effort to resolve Tax Court cases by giving taxpayers not represented by counsel the opportunity to receive free tax advice and possible representation from Low Income Taxpayer Clinics (LITCs) or other pro bono organizations. Taxpayers can discuss their Tax Court case and federal tax issues with members of the IRS Office of Chief Counsel, Appeals and Collections. The program is geared to help unrepresented taxpayers receive free assistance in discussing a potential fair settlement of their tax disputes in an informal setting without the need for further litigation or a trial in Tax Court. The vast majority of taxpayers participating in previous Settlement Days programs have resolved their cases; most of those who ended up with a liability have been able to enter into an installment payment arrangement. The Tax Court canceled scheduled trial sessions in a series of Orders issued on March 11, 13 and 23, 2020.  The Tax Court Orders state that it is expected that parties will continue to work together to exchange information and address pending issues. The Settlement Days events accomplish the Tax Court’s goals by allowing the parties to work towards settling case on a remote basis.  Chief Counsel has scheduled Virtual Settlement Days events for May 2020 for cases docketed on the Detroit and Atlanta Tax Court trial sessions. Chief Counsel has invited more than 100 unrepresented taxpayers to meet with Chief Counsel attorneys or paralegals via WebEx for the two events. The taxpayers will be able to speak with LITC representatives prior to the WebEx meetings. If the taxpayer desires, the LITC representatives will later join the WebEx meetings. The Detroit Office of Chief Counsel will host its event on Saturday, May 9, in conjunction with the University of Michigan Law School LITC for the Detroit trial session cases. The IRS has invited over 100 Tax Court petitioners.  The cases being selected are from recently canceled Tax Court calendars, as well as other docketed cases not yet set for trial. The event may be extended, if needed, to meet taxpayer’s needs.  The Atlanta Office of Chief Counsel will host the second event on Thursday, May 21, in conjunction with the North Georgia Low Income Taxpayer Clinic for the cancelled Atlanta trial session cases and other docketed cases. The event may extend over several days to accommodate the schedules of the participants. The IRS will focus on inviting unrepresented taxpayers whose cases sessions have been delayed due to Tax Court cancellations. While docket taxpayers with cases currently under consideration by the IRS Independent Office of Appeals have not been sent invitations to the Detroit and Atlanta events, the IRS encourages those petitioners to contact the Appeals Officer assigned to their case to discuss resolution. Appeals continues to work cases, including use of virtual conferences. For unrepresented taxpayers who are working with an Appeals Officer and receive an invitation to the event, the IRS will work with them at the event to resolve all their issues. In addition, IRS Chief Counsel recently prepared a Virtual Settlement Days Best Practice Guide for external use that will be released in advance of the Virtual Settlement Days events. Chief Counsel anticipates that Virtual Settlement Days will be a mainstay of its Settlement Day efforts even after this crisis is over. Chief Counsel released an initial Settlement Days Best Practices Guide in January 2020, which outlined a remote model for the program.

https://www.irs.gov/newsroom/va-ssi-recipients-with-eligible-children-need-to-act-by-tuesday-may-5-to-quickly-add-money-to-their-automatic-economic-impact-payment-plus-500-push-continues

May 5 deadline for VA, SSI recipients who don't file a tax return and have dependents IR-2020-86, May 1, 2020 WASHINGTON — The Internal Revenue Service today reminded Supplemental Security Income and Department of Veterans Affairs beneficiaries to act by Tuesday, May 5 if they didn't file a tax return in 2018 or 2019 and have dependents so they can quickly receive the full amount of their Economic Impact Payment. Their $1,200 payments will be issued soon and, in order to add the $500 per eligible child amount to these payments, the IRS needs the dependent information before the payments are issued. Otherwise, their payment at this time will be $1,200 and, by law, the additional $500 per eligible child amount will be paid in association with a return filing for tax year 2020. "The deadline is quickly approaching for these groups so they can get their maximum Economic Impact Payment of $1,200 and $500 for each eligible child as quickly as possible," said IRS Commissioner Chuck Rettig. "These groups will get $1,200 automatically, but they need to act quickly and use the Non-Filers tool on IRS.gov to get the extra $500 per child added to their payment. Everyone should share this information widely and help others with the Plus $500 Push, so that more Americans get more money as fast as possible." Following extensive work by the IRS and partner government agencies, $1,200 automatic payments will be starting soon for those receiving Social Security retirement, survivor or disability benefits (SSDI), Railroad Retirement benefits, Supplemental Security Income (SSI) and VA Compensation and Pension (C&P) beneficiaries who didn't file a tax return in the last two years. No action is needed by these groups to automatically receive their $1,200 payment. For VA and SSI recipients who have a qualifying child and didn't file a 2018 or 2019 tax return, they have a limited window to register to have $500 per eligible child added automatically to their soon-to-be-received $1,200 Economic Impact Payment. A quick trip to a special Non-Filers tool on IRS.gov by Tuesday, May 5 for these groups may help put all of their eligible Economic Income Payment into a single payment. The Non-Filers tool is available in English and Spanish. To help spread the word to recipients with children about this special "Plus $500 Push," the IRS has additional material available on a special partners page that can be shared with friends, family members and community groups. SSI and VA recipients: Have a child but don't file a tax return? Visit IRS.gov now SSI and VA recipients who have children and who weren't required file a tax return in 2018 or 2019 should visit the Non-Filers: Enter Payment Info Here tool on IRS.gov. By quickly taking steps to enter information on the IRS website about them and their qualifying children, they can receive the $500 per dependent child payment automatically in addition to their $1,200 individual payment. Otherwise, their payment at this time will be $1,200 and, by law, the additional $500 per eligible child amount would be paid in association with a return filing for tax year 2020. SSI and VA recipients who receive Compensation and Pension (C&P) benefit payments should receive their automatic payments by mid-May. If they have children and aren't required to file a tax return, both groups are urged to use the Non-Filers tool as soon as possible before the May 5 deadline. Once the deadline passes and processing begins on the $1,200 payment, they will not be eligible to use the Non-Filers tool to add eligible children. Their payment will be $1,200 and, by law, the additional $500 per eligible child amount would be paid in association with a return filing for tax year 2020. SSA/Railroad Retirees: Economic Impact Payments started arriving this week For recipients of Social Security retirement, survivors or disability insurance benefits (SSDI) and Railroad Retirement benefits (RRB), automatic payments of $1,200 began arriving this week. No action is needed on their part. This includes people who don't normally file a tax return. For Social Security/RRB beneficiaries who don't normally file a tax return, have a child and registered using the IRS Non-Filers tool by the April 22 deadline, more payments are arriving this week as well. For SSA/RRB beneficiaries who don't normally file a tax return and have a child but did not register on the IRS Non-Filers tool by April 22, they still are receiving their automatic $1,200 starting this week. Given the deadline has passed, by law, the additional $500 per eligible child amount would be paid in association with filing a tax return for 2020. This group can no longer use the Non-Filers tool to add eligible children. Note - Direct Express Account Holders: You may use the Non-Filers tool, but you cannot receive your and your children's payment on your Direct Express account. You may only select a bank account for direct deposit or leave bank information blank and receive the money by mail. No action needed by most taxpayers The Treasury Department will make these automatic payments to SSA, SSI, RRB and VA recipients. Recipients will generally receive the automatic $1,200 payments by direct deposit, Direct Express debit card or by paper check, just as they would normally receive their benefits. For more information related to veterans and their beneficiaries who receive Compensation and Pension (C&P) benefit payments from VA, please visit VA.gov. General IRS information about the Economic Impact Payments is available on a special section of IRS.gov. Watch out for scams related to Economic Impact Payments The IRS urges taxpayers to be on the lookout for scams related to the Economic Impact Payments. There is no fee required to receive these payments.

https://www.irs.gov/newsroom/taxpayers-should-file-by-july-15-tax-deadline-automatic-extension-to-oct-15-available

IRS has easy ways to help taxpayers who need more time or payment options IR-2020-134, June 29, 2020 WASHINGTON ― The Department of the Treasury and IRS today announced the tax filing and payment deadline of July 15 will not be postponed. Individual taxpayers unable to meet the July 15 due date can request an automatic extension of time to file until Oct. 15. Due to COVID-19, the original filing deadline and tax payment due date for 2019 was postponed from April 15 to July 15. The IRS reminds taxpayers filing Form 1040 series returns that they must file Form 4868 by July 15 to obtain the automatic extension to Oct. 15. The extension provides additional time to file the tax return – it is not an extension to pay any taxes due. The IRS urges people who owe taxes, even if they have a filing extension, to carefully review their situation and pay what they can by July 15 to avoid penalties and interest. For people facing hardships, including those affected by COVID-19, who cannot pay in full, the IRS has several options available to help. To avoid interest and penalties, the IRS encourages them to pay what they can and consider a variety of payment options available for the remaining balance. “The IRS understands that those affected by the coronavirus may not be able to pay their balances in full by July 15, but we have many payment options to help taxpayers,” said IRS Commissioner Chuck Rettig. “These easy-to-use payment options are available on IRS.gov, and most can be done automatically without reaching out to an IRS representative.” Automatic Extension of Time to File Taxpayers who need more time to prepare and file their federal tax return can apply for an extension of time to file until Oct. 15. To get an extension, taxpayers must estimate their tax liability on the extension form and pay any amount due. Individual taxpayers have several easy ways to file Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, by the July 15 deadline. Tax software providers have an electronic version available. In addition, all taxpayers, regardless of income, can use IRS Free File to electronically request an automatic tax-filing extension. Save a step: Get an extension when you make a payment Taxpayers can also get an extension by paying all or part of their tax due and indicate that the payment is for an extension using Direct Pay, the Electronic Federal Tax Payment System (EFTPS), or a credit or debit card. When getting an extension by making a payment, taxpayers do not have to file a separate extension form and will receive a confirmation number for their records. State deadlines may differ The IRS also reminds taxpayers to check their state filing and payment deadlines, which may differ from the federal July 15 deadline. A list of state tax division websites is available through the Federation of Tax Administrators. Payment options Taxpayers who owe taxes can choose from the following payment options: IRS Direct Pay allows payment directly from a checking or savings account. This service is free. Electronic Federal Tax Payment System, or EFTPS. Pay by phone or online. This service is free. Debit or credit card payment. This service is free, but the processing company may charge a fee. Fees vary by company. Check or money order made payable to the United States Treasury (or U.S. Treasury) through the mail. The IRS recommends that taxpayers who are unable to pay their taxes in full should act as quickly as possible. Tax bills can quickly accumulate more interest and penalties the longer they sit. Several payment options are available on IRS.gov/payments to help taxpayers who can’t pay in full and some can offer taxpayers smaller penalties. Though interest and late-payment penalties continue to accrue on any unpaid taxes after July 15, the failure to pay tax penalty rate is cut in half while an installment agreement is in effect. The usual penalty rate of 0.5% per month is reduced to 0.25% For the calendar quarter beginning July 1, 2020, the interest rate for underpayment is 3%. Most taxpayers who cannot pay in full have the following payment options: Online Payment Agreement — These are available for individuals who owe $50,000 or less in combined income tax, penalties and interest and businesses that owe $25,000 or less in combined payroll tax, penalties and interest and have filed all tax returns. Most taxpayers qualify for this option, and an Online Payment Agreement can usually be set up in a matter of minutes on IRS.gov/opa. Online Payment Agreements are available Monday – Friday, 6 a.m. to 12:30 a.m.; Saturday, 6 a.m. to 10 p.m.; Sunday, 6 p.m. to midnight. All times are Eastern time. Certain fees may apply. Installment Agreement — Taxpayers who do not qualify to use the online payment agreement option, or choose not to use it, can also apply for a payment plan by phone, or by mail by submitting Form 9465, Installment Agreement Request. Installment agreements paid by direct deposit from a bank account or a payroll deduction will help taxpayers avoid default on their agreements. It also reduces the burden of mailing payments and saves postage costs. Certain fees may apply. Temporarily Delaying Collection — You can contact the IRS to request a temporary delay of the collection process. If the IRS determines a taxpayer is unable to pay, it may delay collection until the taxpayer's financial condition improves. Penalties and interest continue to accrue until the full amount is paid. Offer in Compromise — Certain taxpayers qualify to settle their tax bill for less than the amount they owe by submitting an offer in compromise. To help determine eligibility, use the Offer in Compromise Pre-Qualifier tool. In addition, taxpayers can consider other options for payment, including getting a loan to pay the amount due. In many cases, loan costs may be lower than the combination of interest and penalties the IRS must charge under federal law.

https://www.irs.gov/newsroom/irs-releases-new-data-book-with-redesigned-expanded-format-to-provide-more-detailed-view-of-service-compliance-activities-in-fy-2019

IR-2020-133, June 29, 2020 WASHINGTON — The Internal Revenue Service today unveiled the 2019 IRS Data Book, featuring a redesigned format that provides a different and expanded look at IRS accomplishments during the past year. Available now on IRS.gov, the redesigned Fiscal Year 2019 edition of the IRS Data Book provides the annual set of statistical tables summarizing tax filings, revenue collections, taxpayer services, enforcement activities and agency operations. The new Data Book features an updated format with additional tables designed to more accurately reflect the way the IRS does business today. "The IRS is changing from many perspectives, and the Data Book reflects that change as well," IRS Commissioner Chuck Rettig wrote in the Data Book's introduction. "Along those lines, we've redesigned the Data Book for Fiscal Year (FY) 2019 by reorganizing key material and adding new information. This is part of an effort to help the Data Book provide a more complete view of our extensive service and compliance operations in a clear format that is easier to use for taxpayers and the tax community." The Data Book complements the new IRS Progress Update PDF, a new annual report that premiered in January. "In presenting this information, our goal is to help everyone understand the scope of our work for the nation," Rettig added. "The IRS touches more Americans than any other entity, public or private. Our employees take pride in providing top-quality service to taxpayers — helping them meet their tax obligations through clear guidance while ensuring their rights are protected. When citizens can perform their civic duty each year by preparing and filing their taxes and paying only what they should, they help fund critical aspects of the United States, ranging from schools and roads to Social Security payments and the nation's military." Rettig also notes the IRS response to COVID-19 in the new Data Book. The coronavirus delayed publication of this year's Data Book. As Rettig further noted, "we realize when the public thinks of compliance, they think of audits, but there is so much more to our work to ensure appropriate compliance with the tax law and serve the nation. We've created a new section called "Compliance Presence," so everyone can easily see the many different activities related to enforcement. Beyond traditional examinations, these activities include more than 5 million compliance steps the IRS takes every year to ensure fairness in our tax system." Among the compliance steps, illustrated by statistics in this section, are math error notices, matching tax return entries to information returns filed by employers, banks and other third parties, and casework by IRS Criminal Investigation. Recognizing that audits can take several years to complete, for example, new Table 17a takes a long-term view by presenting both audits closed and audits in progress, tied to tax returns for tax-years 2010 through 2018. The new table also presents data based on the taxpayer's total positive income, excluding losses, the same measure the IRS uses to assign exam codes. This year for the first time, the Data Book also shows the number of installment payment agreements set up by individuals and businesses with the IRS. Another addition is the number of Identity Protection Personal Identification Numbers (IP PINs) issued for filing years 2011-2020 to certain victims of tax-related identity theft. The new Data Book shows that during FY 2019, the IRS: Processed more than 253 million individual and business tax returns and forms, with nearly 73% of them filed electronically. Of that total, about 154 million were individual income tax returns, with about 89% of them being e-filed. Collected more than $3.5 trillion in Federal taxes paid by individuals and businesses, with the individual income tax accounting for about 56% of the total. Issued nearly 121.9 million refunds to individuals and businesses totaling more than $452 billion. The bulk of them — more than 119.8 million totaling over $270 billion — went to individual income tax filers. Of that total, nearly 17.3 million included a refundable Child Tax Credit and nearly 24.6 million included a refundable Earned Income Tax Credit. Attracted nearly 651 million visits to IRS.gov, its popular website. Set up more than 2.8 million new payment or installment agreements, with nearly 1.1 million of them established online at IRS.gov. Reinvigorated its non-filer compliance initiative by closing over 364,000 cases under the Automated Substitute for Return Program, resulting in nearly $6.6 billion in additional assessments. Completed nearly 2,800 criminal investigations. To view or download a pdf file of the complete FY 2019 IRS Data Book, Excel files of any of its 34 tables, or Data Books or tables from past years, visit the Statistics of Income page on IRS.gov.

https://www.irs.gov/newsroom/national-taxpayer-advocate-erin-collins-delivers-her-first-report-to-congress-identifies-covid-19-challenges-cares-act-and-taxpayer-first-act-implementation-as-priority-issues-for-taxpayers

IR-2020-132, June 29, 2020 WASHINGTON ― National Taxpayer Advocate Erin M. Collins today released her first report to Congress, identifying taxpayer challenges arising from the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and the IRS's implementation of the Taxpayer First Act as priority issues the Taxpayer Advocate Service (TAS) plans to focus on in the coming year. The report also assesses the 2020 filing season, identifies other TAS areas of focus, and includes the IRS's responses to administrative recommendations proposed in the National Taxpayer Advocate's 2019 annual report. "On March 30, 2020, I had the honor and privilege of being sworn in as the third National Taxpayer Advocate," Collins wrote. "Starting in the midst of a pandemic and witnessing IRS offices closing one by one was not the way I envisioned my role when I accepted the position, . . . but there also has been a silver lining in this experience: As I have participated in conference calls with members of my leadership team, TAS employees, and the IRS's COVID-19 response team, I have been extraordinarily impressed by their commitment and focus on the health and safety of all employees during this pandemic, while still doing as much as possible to assist taxpayers." In her preface to the report, Collins expressed appreciation to Nina Olson, who served as the National Taxpayer Advocate from 2001-2019, and Val Oveson, who served as the first National Taxpayer Advocate from 1998-2000. "Over the past 20 years, TAS has successfully assisted more than 4.5 million taxpayers by helping them resolve their tax problems and protecting their rights, and it has made hundreds of administrative recommendations adopted by the IRS and some 45 legislative recommendations enacted by Congress," Collins wrote. Taxpayer challenges arising from COVID-19 pandemic The report praises the IRS for acting quickly to postpone over 300 filing, payment, and other time-sensitive deadlines, provide broad relief from compliance actions under its "People First Initiative," and disburse some 160 million Economic Impact Payments (EIPs) authorized by the CARES Act, enacted on March 27, 2020. However, the report says that despite the IRS's best efforts, there have been notable adverse taxpayer impacts, including: Taxpayers who filed a 2019 paper return and are entitled to refunds may be in for a long wait. The IRS had to suspend the processing of paper tax returns, and as of May 16, it estimated it had a backlog of 4.7 million paper returns. Although the IRS is reopening some of its core operations, it is not clear when it can open and process all the returns sitting in mail facilities. Some taxpayers whose returns were mistakenly flagged by IRS processing filters are experiencing lengthy delays in receiving their refunds. All tax returns claiming refunds are passed through filters designed to detect identity theft and other types of refund fraud. As TAS has documented, some of these filters produce "false positive rates" of more than 50 percent (meaning that more than half the taxpayers whose returns are stopped by certain filters are entitled to the refunds they claimed). Affected taxpayers are often asked to mail in documentation to substantiate their claims, but the IRS has not opened or processed many of their responses, delaying their refunds. Refund delays can have a significant financial impact on low-income taxpayers, as refunds often constitute a significant percentage of their annual household incomes. Notably, some of the refund delays have been generated by claims for the earned income tax credit or additional child tax credit. Taxpayers who have needed help from the IRS have had difficulty obtaining it. The IRS shut down its Accounts Management telephone lines, so taxpayers could not reach a live assistor by telephone. The IRS shut down its Taxpayer Assistance Centers, making it impossible for taxpayers to obtain in-person assistance. The IRS also shut down its mail facilities, so it was unable to log or process taxpayer responses to compliance notices. The only resources readily available were IRS.gov and automated telephone lines. The IRS has begun reopening its operations, but it will take some time before they are restored to full capacity. IRS systems prepared over 20 million notices during the pandemic that could not be mailed due to closure of notice production centers between April 8 and May 31. The IRS is mailing these notices now. However, some collection notices bear old dates and include response deadlines that often have passed. The IRS plans to include "inserts" with these notices explaining that response deadlines have been postponed, but the report expresses concern that receiving compliance notices with response deadlines that have passed will be confusing and concerning to many taxpayers who may not read the inserts. Taxpayer challenges relating to the CARES Act The report says the IRS generally did a commendable job implementing the CARES Act, but taxpayer challenges remain, including: Individuals who did not receive some or all of their EIPs may have to wait until next year to receive them. To date, the IRS has taken the position that most taxpayers who did not receive their full payments must wait until they file their 2020 income tax returns to claim the amounts as credits against their 2020 tax liabilities, even though there is no legal constraint on the IRS's ability to issue additional EIP amounts as advance refunds during 2020. Congress enacted the CARES Act both to provide emergency financial relief to taxpayers on an individual level and to boost spending on the national level. TAS will continue to urge the IRS to provide full EIPs to eligible taxpayers throughout 2020 as rapidly as possible. The report says that making taxpayers wait until next year to receive their EIPs harms the affected taxpayers and is inconsistent with congressional intent. Employers are struggling to determine whether they qualify for the Employee Retention Credit (ERC) and in what amounts. The ERC is a complex, refundable tax credit that requires employers to determine when a trade or business was fully or partially suspended by government order; the employer's number of full-time employees; what constitutes qualified wages; whether a business's operations post-COVID-19 are comparable to its pre-COVID-19 operations; and the application of aggregation rules. To address these complexities, the IRS has provided considerable guidance regarding when and how to claim the ERC. However, several areas require further clarification. If clarity is not provided, taxpayers will be more likely to make unintentional errors, increasing the risk of an audit. Having to untangle these issues in an audit environment would drain the limited resources of both the IRS and the businesses affected by the COVID-19 pandemic. TAS will continue to advocate that the IRS further clarify the rules governing when and how employers should claim this credit. Businesses are facing challenges when seeking to utilize the CARES Act provision that authorizes the use of net operating losses to offset taxable income in prior years (and in some cases to receive refunds). For businesses to determine the optimal application of the CARES Act provisions so they can exercise their right to pay no more than the correct amount of tax, they may need to create and run complex financial models involving multiple tax years. The report says the IRS has provided timely guidance in the form of frequently asked questions (FAQs), but it expresses concern that FAQs are not authoritative or binding on the IRS. Implementation of Taxpayer First Act The Taxpayer First Act (TFA), enacted one year ago, constitutes the most far-reaching revisions to tax administration since the IRS Restructuring and Reform Act of 1998. The TFA included some 23 provisions recommended by the National Taxpayer Advocate. A centerpiece of the TFA is a requirement that the IRS develop four strategic plans: (i) a comprehensive taxpayer service strategy; (ii) a plan to redesign the IRS's organizational structure; (iii) a comprehensive employee training strategy that includes training on taxpayer rights and the role of TAS; and (iv) a multi-year plan to meet IRS information technology needs. The TFA required the IRS to submit its comprehensive taxpayer service strategy to Congress by July 1, 2020. Because of disruptions caused by COVID-19, the IRS has been delayed in developing these plans, but it expects to deliver its taxpayer service strategy to Congress by the end of the year. The report details some steps the IRS has taken to receive input from taxpayers, practitioners, and TAS, and identifies over two dozen TFA provisions that the IRS has implemented. It expresses concern that the IRS has not properly implemented a provision directing it to establish a single point of contact for identity theft victims and that it may not properly implement a provision directing it to exclude taxpayers with adjusted gross incomes at or below 200 percent of the Federal Poverty Level from assignment to private debt collection agencies by December 31, 2020. Collins said, "I have been impressed by many ideas the IRS is considering, and I look forward to working with the leadership as it refines its taxpayer service strategy in the coming months." 2020 filing season review The National Taxpayer Advocate's mid-year report typically includes an assessment of the filing season that measures performance against the results of prior filing seasons. Because the IRS closed most of its operations in March and postponed many filing and payment deadlines from April 15 to July 15, this filing season cannot fairly be compared with prior years. The disruption caused by COVID-19 and the postponed due date has had – and continues to have – an enormous impact on the 2020 filing season, reflected in the number of returns received, the volume of correspondence received from taxpayers, and the reduction in toll-free telephone service. Among the impacts were: Due to campus and office closures, the IRS could not staff phone lines to assist callers beginning the week of March 21, 2020. After March 20, 2020, taxpayers no longer had access to face-to-face customer service. There is a large backlog of incoming mail (about ten million pieces of mailed tax returns or correspondence sitting in trailers at IRS campuses). The IRS could not process paper returns and process or respond to other written correspondence from taxpayers. The IRS has sent only a very limited volume of outgoing taxpayer correspondence. There was a substantial reduction in Volunteer Income Tax Assistance, Tax Counseling for Elderly, and Low Income Taxpayer Clinic services. The National Distribution Center was shut down, depriving taxpayers of a means to acquire pre-printed forms. Because of the IRS's limitations and the postponed filing deadline, an assessment of the filing season is necessarily incomplete. The report says TAS may provide a more thorough analysis later. Other TAS areas of focus for Fiscal Year 2021 Beyond COVID-19, the CARES Act, and TFA implementation, TAS continues to advocate on a broad range of issues. The report describes ten issues TAS plans to focus on during the upcoming fiscal year. These include working with the IRS to provide taxpayers with limited English proficiency meaningful access to tax products and services; improving the clarity and content of IRS notices and correspondence; improving service to and communication with taxpayers in rural and other communities that lack high-speed internet access; and working with the IRS to refine its screening filters so fewer legitimate returns are flagged as potentially fraudulent and cause refund delays for affected taxpayers. IRS responses to National Taxpayer Advocate administrative recommendations The National Taxpayer Advocate is required by statute to submit a year-end report to Congress that makes administrative recommendations to resolve taxpayer problems. Section 7803(c)(3) of the Internal Revenue Code authorizes the National Taxpayer Advocate to submit administrative recommendations to the Commissioner and requires the IRS to respond within three months. Under this authority, the National Taxpayer Advocate annually transmits to the Commissioner all administrative recommendations proposed in her year-end report for response. The Acting National Taxpayer Advocate made 78 administrative recommendations in the 2019 year-end report and then submitted them to the Commissioner for response. Of those, 59 were made in the "Most Serious Problems" section of the report. The IRS has implemented or agreed to implement 41 (or 69 percent). The report made 19 administrative recommendations in other sections of the report. The IRS has taken the position that it is not required to respond directly to them and has provided only general narrative responses. The National Taxpayer Advocate believes the IRS is required to provide direct responses. "The intent of the statute is clear," the report says. "If the National Taxpayer Advocate makes an administrative recommendation to mitigate a taxpayer problem – regardless of whether or where it has appeared in a report – the IRS should evaluate it and respond in writing so that TAS, Congress, and the taxpaying public know whether the IRS plans to implement the recommendation and, if not, why not. General narrative discussions that do not address recommendations directly fail to satisfy this objective." The IRS responses are published in full in an appendix to the report. The National Taxpayer Advocate is required by statute to submit two annual reports to the House Committee on Ways and Means and the Senate Committee on Finance. The statute requires these reports to be submitted directly to the Committees without any prior review or comment from the Commissioner of Internal Revenue, the Secretary of the Treasury, the IRS Oversight Board, any other officer or employee of the Department of the Treasury or the Office of Management and Budget. The first report must identify the objectives of the Office of the Taxpayer Advocate for the fiscal year beginning in that calendar year. The second report must discuss the ten most serious problems encountered by taxpayers, identify the ten tax issues most frequently litigated in the courts, and make administrative and legislative recommendations to resolve taxpayer problems. The National Taxpayer Advocate blogs about key issues in tax administration. You can subscribe to receive the National Taxpayer Advocate's blogs. About the Taxpayer Advocate Service The Taxpayer Advocate Service (TAS) is an independent organization within the IRS that helps taxpayers and protects taxpayer rights. Your local advocate's number is in your local directory and at Taxpayer Advocate Service - Contact Us. You can also call TAS toll-free at 877-777-4778. TAS can help if you need assistance in resolving an IRS problem, if your problem is causing financial difficulty, or if you believe an IRS system or procedure isn't working as it should. Our service is free. For more information about TAS and your rights under the Taxpayer Bill of Rights, go to https://taxpayeradvocate.irs.gov/. You can get updates on tax topics at facebook.com/YourVoiceAtIRSPDF, twitter.com/YourVoiceatIRS, and youtube.com/TASNTA.

https://www.irs.gov/newsroom/irs-july-15-tax-payment-deadline-approaching-plan-on-scheduling-multiple-payments-now

IR-2020-131, June 26, 2020 WASHINGTON ― As the 2019 tax filing and payment deadline approaches, the IRS reminds taxpayers and businesses that 2019 income tax liabilities as well as postponed April 15 and June 15, 2020 estimated tax payments are due July 15, 2020. This postponement provided temporary tax relief in response to the COVID 19 pandemic. Taxpayers who owe a 2019 income tax liability, as well as estimated tax for 2020, must make two separate payments on or by July 15, 2020: One for their 2019 income tax liability and one for their 2020 estimated tax payments. The two estimated tax payments can be combined into a single payment. A list of forms due July 15 is on the Coronavirus Tax Relief: Filing and Payment Deadlines page. Electronic payment options are the optimal way to make a tax payment. Paying electronically: Individuals – Taxpayers can use Direct Pay for two payments each day. Direct Pay allows taxpayers to pay online directly from a checking or savings account for free, and to schedule payments up to 365 days in advance. They will receive an email confirmation of their payments.   Businesses – For businesses or those making large payments, the best payment option is the Electronic Federal Tax Payment System, which allows up to five payments per day. Enrollment is required. Taxpayers can schedule payments up to 365 days in advance and opt in to receive email notifications about their payments. Visit IRS.gov/eftps for details. Paying by check, money order or cashier's check: 2019 Tax Liability – If paying a 2019 income tax liability without an accompanying 2019 tax return, taxpayers paying by check, money order or cashier's check should include Form 1040-V, Payment Voucher with the payment.   For those paying when filing their 2019 income tax return, do not staple or paperclip the payment to the return. For more information, go to Pay by Check or Money Order on IRS.gov.   2020 Estimated Tax Payments - Taxpayers making their 2020 estimated tax payment by check, money order or cashier's check should include the appropriate Form 1040-ES payment voucher. Indicate on the check memo line that this is a 2020 estimated tax payment. Additional electronic payment options: Payment options are available at IRS.gov/payments: Taxpayers can pay when they file electronically using tax software online. If using a tax preparer, ask the preparer to make the tax payment through an electronic funds withdrawal from a bank account.   Taxpayers can choose to pay with a credit card, debit card or digital wallet option through a payment processor. Processing fees apply. No part of the card service fee goes to the IRS.   The IRS2Go app provides mobile-friendly payment options, including Direct Pay and Payment Provider payments on mobile devices.   Individuals and businesses, preferring to pay in cash, can do so at a participating retail store. Go to IRS.gov/paywithcash for instructions. For taxpayers paying separately from when they file their tax return, the more secure and quicker way to send a payment to the IRS is by going to IRS.gov/payments and choosing an electronic payment option to submit the payment. Taxpayers should continue to use electronic options to support social distancing and speed the processing of tax returns, refunds and payments. Reviewing federal tax information online Individual taxpayers can go to IRS.gov/account to securely access information about their federal tax account. They can view the amount they owe, access their tax records online, review their payment history and view key tax return information for the most recent tax return as originally filed.

https://www.irs.gov/newsroom/irs-offers-settlement-for-syndicated-conservation-easements-letters-being-mailed-to-certain-taxpayers-with-pending-litigation

IR-2020-130, June 25, 2020 WASHINGTON — The Internal Revenue Service Office of Chief Counsel announced today a time-limited settlement offer to certain taxpayers with pending docketed Tax Court cases involving syndicated conservation easement transactions. Taxpayers eligible for this offer will be notified by letter with the applicable terms. The settlement offer would bring finality to these taxpayers with respect to the syndicated conservation easement issues in their docketed U.S. Tax Court cases. The settlement requires a concession of the income tax benefits claimed by the taxpayer and imposes penalties. "The IRS will continue to actively identify, audit and litigate these syndicated conservation easement deals as part of its vigorous and relentless effort to combat abusive transactions," said IRS Commissioner Chuck Rettig. "These abusive transactions undermine the public's trust in private land conservation and defraud the government of revenue. Ending these abusive schemes remains a top priority for the IRS." The IRS recognizes the important role of conservation easement deductions in incentivizing land preservation for future generations. However, abusive syndicated conservation easement transactions have been of concern to the IRS for several years. In Notice 2017-10, the IRS identified certain syndicated conservation easement transactions as tax avoidance transactions and provided that such transactions (and substantially similar transactions) are listed transactions for purposes of Treasury Regulation § 1.6011-4(b)(2) and §§ 6111 and 6112 of the Internal Revenue Code. Also, in 2019, the IRS added syndicated conservation easement transactions to its annual "Dirty Dozen" list of tax scams. Taxpayers should note that the U.S. Tax Court has held in the government's favor in several opinions and orders in syndicated conservation easement cases. The IRS realizes that some promoters may tell their clients that their transaction is "better" than or "different" from the transactions previously rejected by the Tax Court and that it may be better for the client to litigate than accept this resolution. When deciding whether to accept the offer, the IRS encourages taxpayers to consult with independent counsel, meaning a qualified advisor who was not involved in promoting the transaction or handpicked by a promoter to defend it.  In listed syndicated conservation easement structures, promoters syndicate ownership interests in real property through partnerships, using promotional materials to suggest that prospective investors may be entitled to a share of a conservation easement contribution deduction that equals or exceeds two and one-half times the investment amount. The promoters obtain an appraisal that greatly inflates the value of the conservation easement based on a fictional and unrealistic highest and best use of the property before it was encumbered with the easement. After the investors invest in the partnership, the partnership donates a conservation easement to a land trust. Investors in the partnership then claim a deduction based on an inflated value. The investors typically claim charitable contribution deductions that grossly multiply their actual investment in the transaction and defy common sense. The IRS has developed a comprehensive, coordinated enforcement strategy to address abusive syndicated conservation easement transactions and has also been working closely with the U.S. Department of Justice to shut down the promotion of them. The IRS will continue to disallow the claimed tax benefits, asserting civil penalties to the fullest extent, considering criminal sanctions in appropriate cases, and continuing to pursue litigation of the cases that are not otherwise resolved administratively. This syndicated conservation easement resolution should not be deemed to have any impact on the potential criminal exposure, investigation and/or prosecution of any individual or entity that participated in or assisted or advised others in participating in a syndicated conservation easement transaction in any manner whatsoever. In addition, part of the IRS' strategy is the creation of two new offices that are actively investigating these transactions: the Promoter Investigation Coordinator and the Office of Fraud Enforcement. For certain taxpayers involved in syndicated conservation easements, the IRS Office of Chief Counsel has decided, however, to offer taxpayers an opportunity to resolve certain docketed cases on standardized terms. The settlement offer will be sent by mail to those eligible. Among the key terms of the settlement offer: The deduction for the contributed easement is disallowed in full. All partners must agree to settle, and the partnership must pay the full amount of tax, penalties and interest before settlement. "Investor" partners can deduct their cost of acquiring their partnership interests and pay a reduced penalty of 10 to 20% depending on the ratio of the deduction claimed to partnership investment. Partners who provided services in connection with ANY Syndicated Conservation Easement transaction must pay the maximum penalty asserted by IRS (typically 40%) with NO deduction for costs. Taxpayers should not expect to settle their docketed Tax Court cases on better terms. Based on cases the Independent Office of Appeals has encountered to date, and the existing state of the law, taxpayers should not later expect a better result than what is provided in this settlement offer. "With this announcement, we encourage taxpayers and their advisors to take a hard, realistic look at their cases. They should carefully review this settlement offer. We believe this is clearly the best option for them to pursue given all of these factors," said IRS Chief Counsel Michael J. Desmond. "Those who choose not to accept the offer should keep in mind the Office of Chief Counsel will continue to vigorously litigate their cases to the fullest extent possible."

https://www.irs.gov/newsroom/electronic-tax-administration-advisory-committee-releases-annual-report-to-congress

IR-2020-129, June 24, 2020 WASHINGTON — The Electronic Tax Administration Advisory Committee (ETAAC) today released its annual report to Congress, featuring recommendations that focus on the prevention of identity theft and refund fraud. The ETAAC is a public forum whose members work closely with the Security Summit, a joint effort of the IRS, state tax administrators and the nation's tax industry that was established in 2015 to fight identity theft-reflated refund fraud and cybercrime. The 2020 report includes a total of 16 recommendations grouped into four sections: Fund, Modernize and Enable the IRS; Defend and Protect our Tax System; Improve the Taxpayer Experience; and Strengthen the Security Summit and the ISAC. ETAAC members represent various segments of the tax community, including individual and business taxpayers, tax professionals and preparers, state and local governments, consumer advocates, tax software developers, payroll service providers and the financial industry. The full report for 2020 is available on IRS.gov. At today's annual meeting, IRS Commissioner Chuck Rettig and IRS leaders thanked eight members of the committee whose terms are ending: Phil Poirier - Poirier served on the ETAAC Outreach Subgroup and for the past year served as Committee Chair. He is a volunteer tax preparer in the IRS Volunteer Income Tax Assistance (VITA) program and is active in the Taxpayer Opportunity Network, which is managed by Prosperity Now and supports VITA programs at the national level. He is also a Senior Fellow with the Center for Social Development at Washington University in St. Louis.   Michael Jackman - Jackman served on the ETAAC Outreach Subgroup. He is a Senior Cybersecurity Analyst for Maximus Federal, and has extensive experience in taxation, tax administration and related information systems. He currently operates a small tax practice and serves as the coordinator for two Volunteer Income Tax Assistance (VITA) sites. Over a 22-year tenure as an IRS employee he held several compliance and information technology positions, culminating in serving in the IRS National Office as the Chief of Systems Development for the original Electronic Filing System.   Suzanne Kruger - Kruger served on the ETAAC Filing Subgroup. She currently serves as the Security Specialist for the Montana Department of Revenue and on several committees for the Montana Information Security Advisory Council (MT-ISAC). She has more than 26 years of experience working with state government, businesses, non-profits and individuals in the accounting, tax preparation and banking fields.   Ada Navarro – Navarro served on the ETAAC Information Sharing Subgroup. Until recently she was Lead Examiner for the Fraud Unit of the Connecticut Department of Revenue Services, handling both civil and criminal tax fraud cases. Navarro has also been co-project manager for Connecticut's paid preparer legislation committee.   Kathy Pickering - Pickering served on the ETAAC Information Sharing Subgroup. She is the Chief Tax Officer at H&R Block. With over 20 years of experience in tax administration, Kathy is responsible for the strategic direction and management of a team of the nation's top tax experts. As head of The Tax Institute, Pickering oversees a group of 23 credentialed tax experts, with deep knowledge of the industry and regular, direct interaction with tax professionals and taxpayers.   John Sapp - Sapp served on the ETAAC Filing Subgroup. He has served a key role at Drake Software for over 20 years, with roles ranging from Chief Financial Officer to Vice President of Drake's Sales and Marketing divisions. Today he serves as the Vice President of Strategic Development, where his role is to help shape the future and growth of one of the largest professional tax software companies in the nation.   Joseph Sica - Sica served on the ETAAC Filing Subgroup. He is Chief Public Policy Officer for Green Dot/Tax Products Group and has been affiliated with tax time financial products and combating fraud in the tax system for the last 28 years. In the earliest days of e-filing, Sica worked with the IRS to develop and pilot refund loans as an incentive for people to file electronically. Prior to IRS having increased fraud detection capabilities, he started the Fraud Service Bureau in 1994 in which banks in the tax loan industry electronically exchanged data to identify fraud and shared results with the IRS.   Mark Steber - Steber served on the ETAAC Filing Subgroup. He is Chief Tax Officer with Jackson Hewitt Tax Service and is responsible for several key initiatives to support overall tax service delivery and quality assurance. Steber serves as a Jackson Hewitt liaison with the Internal Revenue Service, States, other government authorities, Walmart, other retail entities, and banking partners. With more than 30 years of tax experience, Steber is widely referenced as an expert on consumer income tax issues and especially electronic tax and data protection issues.

https://www.irs.gov/newsroom/irs-finalizes-guidance-for-the-section-199a-deduction-for-shareholders-of-regulated-investment-companies

IR-2020-128, June 24, 2020 WASHINGTON — The Internal Revenue Service today issued final regulations permitting a regulated investment company (RIC) that receives qualified real estate investment trust (REIT) dividends to report dividends the RIC pays to its shareholders as section 199A dividends. Section 199A, enacted as part the Tax Cuts and Jobs Act (TCJA), allows individual taxpayers and certain trusts and estates to deduct up to 20 percent of certain income (section 199A deduction). The section 199A deduction is available to eligible taxpayers with qualified business income (QBI) from qualified trades or businesses operated as sole proprietorships or through partnerships, S corporations, trusts, or estates, as well as for qualified REIT dividends and income from publicly traded partnerships. The section 199A deduction is not available for C corporations. The regulations issued today provide that a shareholder in a RIC may, subject to limitations, treat a section 199A dividend received from a RIC as a qualified REIT dividend for purposes of determining the section 199A deduction. The regulations also provide additional guidance on the treatment of previously disallowed losses that are included in QBI in subsequent years and provide guidance for taxpayers who hold interests in split-interest trusts or charitable remainder trusts. For more information about this and other TCJA provisions, visit IRS.gov/taxreform.

https://www.irs.gov/newsroom/irs-announces-rollover-relief-for-required-minimum-distributions-from-retirement-accounts-that-were-waived-under-the-cares-act

IR-2020-127, June 23, 2020 WASHINGTON — The Internal Revenue Service today announced that anyone who already took a required minimum distribution (RMD) in 2020 from certain retirement accounts now has the opportunity to roll those funds back into a retirement account following the CARES Act RMD waiver for 2020. The 60-day rollover period for any RMDs already taken this year has been extended to August 31, 2020, to give taxpayers time to take advantage of this opportunity. The IRS described this change in Notice 2020-51PDF, released today. The Notice also answers questions regarding the waiver of RMDs for 2020 under the Coronavirus Aid, Relief, and Economic Security Act, known as the CARES Act. The CARES Act enabled any taxpayer with an RMD due in 2020 from a defined-contribution retirement plan, including a 401(k) or 403(b) plan, or an IRA, to skip those RMDs this year. This includes anyone who turned age 70 1/2 in 2019 and would have had to take the first RMD by April 1, 2020. This waiver does not apply to defined-benefit plans. In addition to the rollover opportunity, an IRA owner or beneficiary who has already received a distribution from an IRA of an amount that would have been an RMD in 2020 can repay the distribution to the IRA by August 31, 2020. The notice provides that this repayment is not subject to the one rollover per 12-month period limitation and the restriction on rollovers for inherited IRAs. The notice provides two sample amendments that employers may adopt to give plan participants and beneficiaries whose RMDs are waived a choice as to whether or not to receive the waived RMD.

https://www.irs.gov/newsroom/irs-extends-july-15-other-upcoming-deadlines-for-tornado-victims-in-parts-of-the-south-provides-other-relief

IR-2020-126, June 23, 2020 WASHINGTON — Victims of the April tornadoes, severe storms and flooding that took place in parts of Mississippi, Tennessee and South Carolina will have until October 15, 2020, 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 Clarke, Covington, Grenada, Jasper, Jefferson Davis, Jones, Lawrence, Panola and Walthall counties in Mississippi, Bradley and Hamilton counties in Tennessee and Aiken, Barnwell, Berkeley, Colleton, Hampton, Marlboro, Oconee, Orangeburg and Pickens counties in South Carolina. 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. The tax relief postpones various tax filing and payment deadlines that occurred starting on April 12. As a result, affected individuals and businesses will have until October 15, 2020, to file returns and pay any taxes that were originally due during this period. This includes 2019 individual and business returns that, due to COVID-19, were due on July 15. Among other things, this also means that affected taxpayers will have until October 15 to make 2019 IRA contributions. The Oct. 15 deadline also applies to estimated tax payments for the first two quarters of 2020 that were due on July 15, and the third quarter estimated tax payment normally due on September 15. It also includes the quarterly payroll and excise tax returns normally due on April 30 and July 31. In addition, penalties on payroll and excise tax deposits due on or after April 12 and before April 27 will be abated as long as the deposits were made by April 27. 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 payment 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. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization. Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227, once normal operations resume. For information on services currently available from the IRS, visit the IRS operations and services page at IRS.gov/coronavirus. 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. This means that taxpayers can, if they choose, claim these losses on the 2019 return they are filling out this tax season. Be sure to write the appropriate FEMA declaration number on any return claiming a loss. The numbers are 4536 for Mississippi, 4541 for Tennessee and 4542 for South Carolina. See Publication 547 for details. The tax relief is part of a coordinated federal response to the damage caused by these storms and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.

https://www.irs.gov/newsroom/irs-issues-guidance-on-the-elimination-of-the-deduction-of-qualified-transportation-fringe-benefit-expenses

IR-2020-125, June 19, 2020 WASHINGTON — The Internal Revenue Service today issued proposed regulations that provide guidance for the deduction of qualified transportation fringe and commuting expenses. The Tax Cuts and Jobs Act (TCJA) does not allow deductions for qualified transportation fringe (QTF) expenses and does not allow deductions for certain expenses of transportation and commuting between an employee's residence and place of employment. The law also provided that a tax-exempt organization's unrelated business taxable income is increased by the amount of the QTF expense that is nondeductible. However, on December 20, 2019, this was repealed as part of the Further Consolidated Appropriations Act of 2020. This repeal was retroactive to the original date of enactment by the TCJA. These proposed regulations specifically address the elimination of the deduction for expenses related to QTFs provided to an employee of the taxpayer. The proposed regulations also provide guidance and methodologies to determine the amount of QTF parking expense that is nondeductible. The guidance also includes definitions and special rules to clarify and simplify the calculations underlying the methodologies. For more information about this and other TCJA provisions, visit IRS.gov/taxreform.

https://www.irs.gov/newsroom/relief-for-taxpayers-affected-by-covid-19-who-take-distributions-or-loans-from-retirement-plans

IR-2020-124, June 19, 2020 WASHINGTON — The Internal Revenue Service today released Notice 2020-50PDF to help retirement plan participants affected by the COVID-19 coronavirus take advantage of the CARES Act provisions providing enhanced access to plan distributions and plan loans. This includes expanding the categories of individuals eligible for these types of distributions and loans (referred to as "qualified individuals") and providing helpful guidance and examples on how qualified individuals will reflect the tax treatment of these distributions and loans on their federal income tax filings. The CARES Act provides that qualified individuals may treat as coronavirus-related distributions up to $100,000 in distributions made from their eligible retirement plans (including IRAs) between January 1 and December 30, 2020. A coronavirus-related distribution is not subject to the 10% additional tax that otherwise generally applies to distributions made before an individual reaches age 59 ½. In addition, a coronavirus-related distribution can be included in income in equal installments over a three-year period, and an individual has three years to repay a coronavirus-related distribution to a plan or IRA and undo the tax consequences of the distribution. In addition, the CARES Act provides that plans may implement certain relaxed rules for qualified individuals relating to plan loan amounts and repayment terms. In particular, plans may suspend loan repayments that are due from March 27 through December 31, 2020, and the dollar limit on loans made between March 27 and September 22, 2020, is raised from $50,000 to $100,000. As authorized under the CARES Act, Notice 2020-50 expands the definition of who is a qualified individual to take into account additional factors such as reductions in pay, rescissions of job offers, and delayed start dates with respect to an individual, as well as adverse financial consequences to an individual arising from the impact of the COVID-19 coronavirus on the individual's spouse or household member. As expanded under Notice 2020-50, a qualified individual is anyone who – is diagnosed, or whose spouse or dependent is diagnosed, with the virus SARS-CoV-2 or the coronavirus disease 2019 (collectively, "COVID-19") by a test approved by the Centers for Disease Control and Prevention (including a test authorized under the Federal Food, Drug, and Cosmetic Act); or   experiences adverse financial consequences as a result of the individual, the individual's spouse, or a member of the individual's household (that is, someone who shares the individual's principal residence): being quarantined, being furloughed or laid off, or having work hours reduced due to COVID-19; being unable to work due to lack of childcare due to COVID-19; closing or reducing hours of a business that they own or operate due to COVID-19; having pay or self-employment income reduced due to COVID-19; or having a job offer rescinded or start date for a job delayed due to COVID-19. Notice 2020-50 clarifies that employers can choose whether to implement these coronavirus-related distribution and loan rules, and notes that qualified individuals can claim the tax benefits of coronavirus-related distribution rules even if plan provisions aren't changed. The guidance clarifies that administrators can rely on an individual's certification that the individual is a qualified individual (and provides a sample certification), but also notes that an individual must actually be a qualified individual in order to obtain favorable tax treatment. Further, Notice 2020-50 provides employers a safe harbor procedure for implementing the suspension of loan repayments otherwise due through the end of 2020, but notes that there may be other reasonable ways to administer these rules. Employers, financial institutions, and individuals should refer to Notice 2020-50 for more details about how the CARES Act rules for coronavirus-related distributions and loans from plans apply. This tax relief and other information related to the effects of COVID-19 on federal income tax is available on the IRS Coronavirus Tax Relief pages of IRS.gov.

https://www.irs.gov/newsroom/irs-nationwide-tax-forums-seminar-dates-times-now-available

Tax pros can attend up to 30 live-streamed webinars IR-2020-123, June 18, 2020 WASHINGTON — The Internal Revenue Service today released the seminar schedule for the 2020 IRS Nationwide Tax Forums and reminded interested tax professionals that registration information is available. Seminar schedule Held online this year, the Nationwide Tax Forums will begin on July 21 and continue through August 20 with live-streamed webinars broadcast on Tuesdays, Wednesdays and Thursdays. Registration enables attendees to participate in all of the webinars and earn up to 30 continuing education credits for one price.  Date 11 a.m. – noon EDT 2 p.m. – 3 p.m. EDT Tuesday, July 21 Advocating for Immigrant Taxpayers Keynote Address Wednesday, July 22 Advocating for Taxpayers with Collection Information Statements Charities & Tax-Exempt Organizations Update Thursday, July 23 The Bipartisan Budget Act of 2015's Centralized Partnership Audit Regime Be Tax Ready – Understanding Eligibility Rules for EITC, AOTC, CTC and Head of Household Filing Status       Tuesday, July 28 Tax Security Panel: The Taxes-Security-Together Checklist Cybersecurity for Tax Professionals - Advanced Session Wednesday, July 29 Diligence in Practice before the IRS: Record-Keeping Electronic Payments and Direct Deposits – New Options Thursday, July 30 Federal Ethics for the Tax Professionals: Office of Professional Responsibility (OPR) and Circular 230 Impact of Non-filing and Non-payment       Tuesday, Aug. 4 IRS Key Enforcement Issues Keys to Mastering Due Diligence Requirements and Audits Wednesday, Aug. 5 Other Income: Taxable or Not? Preparation of Form 1040-NR, U.S. Nonresident Alien Income Tax Return Thursday, Aug. 6 Protect Yourself and Your Clients Against A New Wave of Criminals Taxpayer Planning Issues After the Enactment of the 2019 Disaster Act and Secure Act       Tuesday, Aug. 11 Representing the Taxpayer Without Records, Reconstructing Income and Expenses Tax Cuts and Jobs Act (TCJA) Update: Opportunity Zones Wednesday, Aug. 12 Retirement Plan Distributions, Loans and More Tax Cuts and Jobs Act (TCJA) Update: Qualified Business Income Deduction Thursday, Aug. 13 QBI Problems? We Have Solutions! Update from the IRS Independent Office of Appeals Tuesday, Aug. 18 Currency: Virtual, Digital, Cyber, Crypto, Form 1040, Schedule 1 and How to Report Worker Classification Issues – Hiring Freelancers Is Never Free and It May Cost You A Lot, Too Wednesday, Aug. 19 Créditos Reembolsables (Spanish session) Construya su Plan de Seguridad de Datos para sus Contribuyentes (Spanish session) Thursday, Aug. 20 Tax Changes from a Forms Perspective Cambios Tributarios desde la Perspectiva de Formularios (Spanish Session) Participation in a virtual IRS Nationwide Tax Forum webinar this summer will earn continuing education credit for enrolled agents, certified public accountants, Annual Filing Season Program participants, California Tax Education Council participants and Certified Financial Planners. Held each summer for the past 30 years, the IRS Nationwide Tax Forums are the IRS's marquee outreach event for the tax professional community. The forums were scheduled to take place in six cities around the country this summer. But because of restrictions on travel and large gatherings, those in-person events have been canceled. Virtual expo all In keeping with the in-person forums, attendees at the virtual forums will have the opportunity to visit an online exhibit hall. Schedule information for the exhibit hall will be available on the registration website. 2020 registration and fees The Early-Bird Registration deadline has been extended to June 30 at 5 p.m. EDT. Tax professionals who register by the deadline qualify for a rate of $240 per person, a $49 savings over the standard rate of $289. Registration for the 2020 in-person forums began in March. Those who previously registered for the live locations may transfer their registration to the virtual format at no additional cost, or they may request a refund provided they do so by the June 30 deadline. Registration information is available at www.irstaxforum.com.

https://www.irs.gov/newsroom/irs-outlines-changes-to-health-care-spending-available-under-cares-act

IR-2020-122, June 17, 2020 WASHINGTON — The Internal Revenue Service has advised that new rules under the CARES Act provide flexibility for health care spending that may be helpful in the current environment where more people may need at-home services due to measures to fight the coronavirus. Telehealth and High Deductible Health Plans Under the CARES Act, a high deductible health plan (HDHP) temporarily can cover telehealth and other remote care services without a deductible, or with a deductible below the minimum annual deductible otherwise required by law. Telehealth and other remote care services also are temporarily included as categories of coverage that are disregarded for the purpose of determining whether an individual who has other health plan coverage in addition to an HDHP is an eligible individual who may make tax-favored contributions to his or her HSA. Thus, an otherwise eligible individual with coverage under an HDHP may still contribute to an HSA despite receiving coverage for telehealth and other remote care services before satisfying the HDHP deductible, or despite receiving coverage for these services outside the HDHP. The temporary rules under the CARES Act, as extended by IRS Notice 2020-29PDF, apply to services provided on or after Jan. 1, 2020, with respect to plan years beginning on or before Dec. 31, 2021. Expansion of qualified medical expenses The CARES Act also modifies the rules that apply to various tax-advantaged accounts (HSAs, Archer MSAs, Health FSAs, and HRAs) so that additional items are "qualified medical expenses" that may be reimbursed from those accounts. Specifically, the cost of menstrual care products is now reimbursable. These products are defined as tampons, pads, liners, cups, sponges or other similar products. In addition, over-the-counter products and medications are now reimbursable without a prescription. The new rules apply to amounts paid after Dec. 31, 2019. Taxpayers should save receipts of their purchases for their records and so that they are able to submit claims for reimbursements. More information The IRS will provide any further updates as soon as they are available on its webpage at IRS.gov/coronavirus.

https://www.irs.gov/newsroom/irs-alert-economic-impact-payments-belong-to-recipient-not-nursing-homes-or-care-facilities

IR-2020-121, June 16, 2020 WASHINGTON — The Internal Revenue Service today alerted nursing home and other care facilities that Economic Impact Payments (EIPs) generally belong to the recipients, not the organizations providing the care. The IRS issued this reminder following concerns that people and businesses may be taking advantage of vulnerable populations who received the Economic Impact Payments. The payments are intended for the recipients, even if a nursing home or other facility or provider receives the person's payment, either directly or indirectly by direct deposit or check. These payments do not count as a resource for purposes of determining eligibility for Medicaid and other federal programs for a period of 12 months from receipt. They also do not count as income in determining eligibility for these programs. The Social Security Administration (SSA) has issued FAQs on this issue, including how representative payees should handle administering the payments for the recipient. SSA has noted that under the Social Security Act, a representative payee is only responsible for managing Social Security or Supplemental Security Income (SSI) benefits. An EIP is not such a benefit; the EIP belongs to the Social Security or SSI beneficiary. A representative payee should discuss the EIP with the beneficiary. If the beneficiary wants to use the EIP independently, the representative payee should provide the EIP to the beneficiary. The IRS also noted the Economic Impact Payments do not count as resources that have to be turned over by benefit recipients, such as residents of nursing homes whose care is provided for by Medicaid. The Economic Impact Payment is considered an advance refund for 2020 taxes, so it is considered a tax refund for benefits purposes. The IRS noted the language in the Form 1040 instructions apply to Economic Impact Payments: "Any refund you receive can't be counted as income when determining if you or anyone else is eligible for benefits or assistance, or how much you or anyone else can receive, under any federal program or under any state or local program financed in whole or in part with federal funds. These programs include Temporary Assistance for Needy Families (TANF), Medicaid, Supplemental Security Income (SSI), and Supplemental Nutrition Assistance Program (formerly food stamps). In addition, when determining eligibility, the refund can't be counted as a resource for at least 12 months after you receive it." Additional information about EIPs and representative payees involving Social Security and Supplemental Security Income benefits can be found on SSA's website. Additional information on EIPs can be found at IRS.gov/eipfaq.

https://www.irs.gov/newsroom/treasury-irs-provide-tax-relief-to-investors-and-businesses-affected-by-covid-19-in-new-markets-tax-credit-transactions

IR-2020-120, June 12, 2020 WASHINGTON — The Treasury Department and the Internal Revenue Service today provided tax relief for certain taxpayers affected by the COVID-19 pandemic involved in new markets tax credit transactions. The taxpayers receiving relief through today's guidance are community development entities (CDEs) and qualified active low-income community businesses (QALICBs) investing and conducting businesses in low-income communities. Notice 2020-49PDF provides a CDE or QALICB with relief for certain specified time-sensitive acts that are due to be performed between April 1, 2020, and Dec. 31, 2020, in order to meet requirements under section 45D of the Internal Revenue Code and its regulations. A CDE or QALICB may perform these acts by Dec. 31, 2020. The additional time is provided for the following time-sensitive acts: Making investments If a CDE is due to invest cash received in a qualified low-income community investment (QLICI) on or after April 1, 2020, and before Dec. 31, 2020, that cash investment is treated as invested in a QLICI to the extent it is invested by Dec. 31, 2020. Reinvestments If a CDE is due to reinvest certain amounts of cash or payment in a QLICI on or after April 1, 2020, and before Dec. 31, 2020, the amounts are treated as continuously invested in a QLICI to the extent the amounts are so reinvested by Dec. 31, 2020. Expending amounts for construction of real property If a QALICB is due to expend the proceeds of a capital or equity investment or loan by a CDE for construction of real property on or after April 1, 2020, and before Dec. 31, 2020, such proceeds are treated as a reasonable amount of working capital of the QALICB if so expended by Dec. 31, 2020. Additional information about tax relief for businesses affected by the COVID-19 pandemic can be found on IRS.gov.

https://www.irs.gov/newsroom/irs-provides-guidance-on-employer-leave-based-donation-programs-that-aid-victims-of-the-covid-19-pandemic

IR-2020-119, June 11, 2020 WASHINGTON — The Internal Revenue Service today provided guidance for employers whose employees forgo sick, vacation or personal leave because of the COVID-19 pandemic. Notice 2020-46 PDF provides that cash payments employers make to charitable organizations that provide relief to victims of the COVID-19 pandemic in exchange for sick, vacation or personal leave which their employees forgo will not be treated as compensation. Similarly, the employees will not be treated as receiving the value of the leave as income and cannot claim a deduction for the leave that they donated to their employer. Employers, however, may deduct these cash payments as a business expense or as a charitable contribution deduction if the employer otherwise meets the respective requirements of either section. Notice 2020-46 provides further details for employers with leave donation programs. Additional information about tax relief for those affected by the COVID-19 pandemic can be found on IRS.gov.

https://www.irs.gov/newsroom/irs-reminder-file-now-choose-direct-deposit-or-schedule-tax-payments-electronically-before-the-july-15-deadline

IR-2020-118, June 11, 2020 WASHINGTON — As the July 15 tax-filing deadline − postponed from April 15 − draws near, the Internal Revenue Service is reminding all taxpayers who have yet to file their 2019 federal tax return to file electronically now, choose direct deposit for their refund, or pay any tax owed electronically. Taxpayers who owe for tax year 2019 or need to pay 2020 estimated taxes originally due for the first quarter on April 15 or the second quarter on June 15 can schedule an electronic payment up to the July 15 due date. The IRS continues to process electronic tax returns, issue direct deposit refunds and accept electronic payments. As of May 29, the IRS received over 133.8 million tax returns and issued over $250.9 billion in refunds. Taxpayers should use electronic options to support social distancing and speed the processing of tax returns, refunds and payments. IRS.gov has a variety of options to help taxpayers. Most taxpayers that usually have a filing or payment deadline falling on or after April 1, 2020, and before July 15, 2020 − including individuals, trusts, estates, corporations and other non-corporate tax filers − qualify for the postponed due date. This means that anyone, including Americans who live and work abroad, now have until July 15 to file their 2019 federal income tax return and pay any tax due. A list of forms due July 15 is on the Coronavirus Tax Relief: Filing and Payment Deadlines page. File electronically for free Taxpayers whose income was $69,000 or less last year are eligible to use IRS Free File software. There are also Free File Fillable Forms, an electronic version of IRS paper forms. It has no income limitations. Free File options are available at IRS.gov/freefile. 2016 file for unclaimed refunds – deadline postponed to July 15 For 2016 tax returns, the normal April 15 deadline to claim a refund is now July 15, 2020. The law provides a three-year window of opportunity to claim a refund. If taxpayers do not file a return within three years, the money becomes property of the U.S. Treasury. The law requires taxpayers to properly address, mail and ensure the tax return postmark is July 15, 2020, or sooner. Choose direct deposit for refunds The safest and fastest way for taxpayers to get their refund is to have it electronically deposited into their bank or other financial account. Taxpayers can use direct deposit to deposit their refund into one, two or even three accounts. Direct deposit is much faster than waiting for a paper check to arrive in the mail. After filing, use Where's My Refund? on IRS.gov or download the IRS2Go mobile app to track the status of a refund. Schedule a payment electronically Taxpayers can file now and schedule their federal tax payments up to the July 15 due date. They can pay online, by phone or with their mobile device and the IRS2Go app. When paying federal taxes electronically taxpayers should remember: Electronic payment options are the optimal way to make a tax payment. They can pay when they file electronically using tax software online. If using a tax preparer, taxpayers should ask the preparer to make the tax payment through an electronic funds withdrawal from a bank account. IRS Direct Pay allows taxpayers to pay online directly from a checking or savings account for free, and to schedule payments up to 365 days in advance. Taxpayers can choose to pay with a credit card, debit card or digital wallet option through a payment processor. No fees go to the IRS. The IRS2Go app provides the mobile-friendly payment options, including Direct Pay and Payment Provider payments on mobile devices. Taxpayers may also enroll in the Electronic Federal Tax Payment System and have a choice of paying online or by phone by using the EFTPS Voice Response System. Taxpayers can go to IRS.gov/account to securely access information about their federal tax account. They can view the amount they owe, access their tax records online, review their payment history and view key tax return information for the most recent tax return as originally filed. Request an extension of time to file a tax return electronically Taxpayers who need more time to prepare their federal tax return should be aware that: An extension of time to file a return does not grant any extension of time to pay taxes.  Taxpayers should estimate and pay any owed taxes by the July 15 deadline to help avoid possible penalties. Taxpayers must file their extension request no later than the July 15 postponed due date of their return. Individual tax filers, regardless of income, can use IRS Free File to electronically request an automatic tax-filing extension. Filing this form gives the taxpayer until October 15 to file a federal tax return. To get the extension, the taxpayers must estimate their tax liability on the extension form and should pay any amount due. Alternatively, taxpayers can get an extension by paying all or part of their estimated income tax due and indicate that the payment is for an extension using Direct Pay, the Electronic Federal Tax Payment System (EFTPS), or a credit or debit card. This way the taxpayer won't have to file a separate extension form and will receive a confirmation number for their records. Get answers to tax questions Taxpayers may find answers to many of their questions using the Interactive Tax Assistant (ITA), a tax law resource that works using a series of questions and responses. IRS.gov has answers for Frequently Asked Questions. The IRS website has tax information in: Spanish (Español); Chinese (中文); Korean (한국어); Russian (Pусский); Vietnamese (Tiếng Việt); and Haitian Creole (Kreyòl ayisyen). For more information go to IRS.gov/covidtaxdeadlines.

https://www.irs.gov/newsroom/irs-reminder-deadline-postponed-to-july-15-for-those-who-pay-estimated-taxes

IR-2020-117, June 9, 2020 WASHINGTON — The Internal Revenue Service reminds taxpayers that estimated tax payments for tax year 2020, originally due April 15 and June 15, are now due July 15. This means that any individual or corporation that has a quarterly estimated tax payment due has until July 15 to make that payment without penalty. In response to the COVID-19 outbreak, the Treasury Department and the Internal Revenue Service are providing special tax filing and payment relief to individuals and businesses. This relief applies to federal income tax returns and tax payments (including tax on self-employment income) otherwise due April 15, 2020. This relief does not apply to state tax payments or deposits or payments of any other type of federal tax. Who needs to pay quarterly? Most often, self-employed people, including many involved in the sharing economy, need to pay quarterly installments of estimated tax. Similarly, investors, retirees and others often need to make these payments. That's because a substantial portion of their income is not subject to withholding. Other income generally not subject to withholding includes interest, dividends, capital gains, alimony and rental income. Special rules apply to some groups of taxpayers, such as farmers, fishermen, casualty and disaster victims, those who recently became disabled, recent retirees and those who receive income unevenly during the year. Taxpayers can avoid an underpayment penalty by owing less than $1,000 at tax time or by paying most of their taxes during the year. Generally, for 2020 that means making payments of at least 90% of the tax expected on their 2020 return. Taxes are pay-as-you-go This means taxpayers need to pay most of their taxes owed during the year as income is received. There are two ways to do that: Withholding from pay, pension or certain government payments such as Social Security; and/or Making quarterly estimated tax payments during the year. Tax Withholding Estimator If a taxpayer receives salaries and wages, they can avoid having to pay estimated tax by asking their employer to withhold more tax from their earnings. To do this, they would file a new Form W-4. If a taxpayer receives a paycheck, the new and improved Tax Withholding Estimator can help them make sure they have the right amount of tax withheld from their pay. The tool is now more mobile friendly and replaces the Withholding Calculator on IRS.gov. The Tax Withholding Estimator offers workers, as well as retirees, self-employed individuals and other taxpayers a clear, step-by-step method for effectively checking their withholding to protect against having too little tax withheld and facing an unexpected tax bill or penalty at tax time next year. How to pay estimated taxes Form 1040-ES, Estimated Tax for Individuals, includes instructions to help taxpayers figure their estimated taxes. They can also visit IRS.gov/payments to pay electronically. IRS offers two free electronic payment options where taxpayers can schedule their estimated federal tax payments up to 30 days in advance with Direct Pay or up to 365 days in advance with the Electronic Federal Tax Payment System (EFTPS). IRS.gov assistance 24/7 Tax help is available 24/7 on IRS.gov. The IRS website offers a variety of online tools to help taxpayers answer common tax questions. For example, taxpayers can search the Interactive Tax Assistant, Tax Topics, Frequently Asked Questions, and Tax Trails to get answers to common questions. More COVID-19 information The IRS will post frequently asked questions on IRS.gov/coronavirus and will provide updates as soon as they are available.

https://www.irs.gov/newsroom/proposed-regulations-address-direct-primary-care-arrangements-and-health-care-sharing-ministry-memberships

IR-2020-116, June 8, 2020 WASHINGTON — The Internal Revenue Service today released proposed regulations addressing the treatment of certain medical care arrangements under section 213 of the Internal Revenue Code. Section 213 of the Code allows individuals to take an itemized deduction for expenses for medical care, including insurance for medical care, to the extent the expenses exceed 7.5% of adjusted gross income. The proposed regulations address direct primary care (DPC) arrangements and health care sharing ministry (HCSM) memberships, and provide the following guidance: Payments for DPC arrangements are expenses for medical care under section 213 of the Code. Because these payments are for medical care, a health reimbursement arrangement (HRA) provided by an employer generally may reimburse an employee for DPC arrangement payments. Payments for membership in a HCSM are expenses for medical care under section 213 of the Code. Because these payments are for medical care, an HRA provided by an employer generally may reimburse an employee for HCSM membership payments. The proposed regulations respond to Executive Order 13877, which directs the Secretary of the Treasury, to the extent consistent with law, to “propose regulations to treat expenses related to certain types of arrangements, potentially including direct primary care arrangements and healthcare sharing ministries, as eligible medical expenses under Section 213(d)” of the Code.

https://www.irs.gov/newsroom/irs-warns-against-covid-19-fraud-other-financial-schemes

IR-2020-115, June 8, 2020 WASHINGTON — The Internal Revenue Service today reminded taxpayers to guard against tax fraud and other related financial scams related to COVID-19. In the last few months, the IRS Criminal Investigation division (CI) has seen a variety of Economic Impact Payment (EIP) scams and other financial schemes looking to take advantage of unsuspecting taxpayers. CI continues to work with law enforcement agencies domestically and abroad to educate taxpayers about these scams and investigate the criminals perpetrating them during this challenging time. "Criminals seize on every opportunity to exploit bad situations, and this pandemic is no exception," said IRS Commissioner Chuck Rettig. "The IRS is fully focused on protecting Americans while delivering Economic Impact Payments in record time. The pursuit of those who participate in COVID-19 related scams, intentionally abusing the programs intended to help millions of Americans during these uncertain times, will long remain a significant priority of both the IRS and IRS-CI." Criminals are continuing to use the COVID-19 Economic Impact Payments as cover for schemes to steal personal information and money. Scams related to COVID-19 are not limited to stealing EIPs from taxpayers, however. CI has already seen scams related to the organized selling of fake at-home test kits, offers to sell fake cures, vaccines, pills and advice on unproven treatments for COVID-19. Other scams purport to sell large quantities of medical supplies through the creation of fake shops, websites, social media accounts and email addresses where the criminal fails to deliver promised supplies after receiving funds. "Criminals try to take advantage of our most vulnerable times and our most vulnerable populations. But because we have seen many of these criminals and schemes before, we know how to find them and we know how to expose them," said Don Fort, Chief of IRS Criminal Investigation. "And because COVID-19 is a global problem, it requires a global solution. Not only are we leveraging our financial investigative expertise domestically, we are working hand-in-hand with our J5 partners on those COVID-19 cases that cross borders. There truly is no place for criminals to hide." Other COVID-19 related scams involve setting up fake charities soliciting donations for individuals, groups and areas affected by the disease. Some criminals are offering opportunities to invest early in companies working on a vaccine for the disease promising that the "company" will dramatically increase in value as a result. These promotions are often styled as "research reports," make predictions of a specific "target price," and relate to microcap stocks, or low-priced stocks issued by the smallest of companies with limited publicly available information. Finally, CI has also seen a tremendous increase in phishing schemes utilizing emails, letters, texts and links. These phishing schemes are using keywords such as "Corona Virus," "COVID-19," and "Stimulus" in varying ways. These schemes are blasted to large numbers of people known by the bad actors in an effort to get personally identifying information or financial account information to include account numbers and passwords. Most of these new schemes are actively playing on the fear and unknown of the virus and the stimulus payments. Coronavirus-related (COVID-19) scams should be reported to the National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or submitted through the NCDF web Complaint Form. The NCDF is a national coordinating agency within the Department of Justice's Criminal Division dedicated to improving the detection, prevention, investigation and prosecution of criminal conduct related to natural and man-made disasters and other emergencies, such as the coronavirus (COVID-19). Hotline staff will obtain information regarding your complaint, which will then be reviewed by law enforcement officials. Taxpayers can also report fraud or theft of their Economic Impact Payments to the Treasury Inspector General for Tax Administration (TIGTA). Reports can be made online. TIGTA investigates external attempts to corruptly interfere with federal tax administration, including IRS-related coronavirus scams. Also, taxpayers can always report phishing attempts to the IRS. Those who receive unsolicited emails or social media attempts to gather information that appear to be from either the IRS or an organization closely linked to the IRS, such as the Electronic Federal Tax Payment System (EFTPS), should forward it to phishing@irs.gov. Taxpayers are encouraged not to engage potential scammers online or on the phone. Learn more by going to the Report Phishing and Online Scams page on IRS.gov. Official IRS information about the COVID-19 pandemic and economic impact payments can be found on the Coronavirus Tax Relief page on IRS.gov, which is updated frequently.

https://www.irs.gov/newsroom/irs-provides-answers-about-coronavirus-related-tax-relief-for-qualified-opportunity-funds-and-investors

IR-2020-114, June 4, 2020 WASHINGTON — The Internal Revenue Service today provided guidance for Qualified Opportunity Funds (QOFs) and their investors in response to the ongoing Coronavirus Disease 2019 (COVID-19) pandemic. Notice 2020-39 PDF answers questions regarding relief from certain requirements under section 1400Z-2 of the Internal Revenue Code (Code) and the implementing regulations. Additionally, the IRS has updated the Qualified Opportunity Zones frequently asked questions. Taxpayers who sold property for an eligible gain and who would have had 180 days to invest in a QOF to defer that gain, may have additional time. Notice 2020-39 provides that if a taxpayer's 180th day to invest in a QOF would have fallen on or after April 1, 2020, and before December 31, 2020, the taxpayer now has until December 31, 2020 to invest that gain into a QOF. (The 180th day for some of these taxpayers was already postponed through July 15, 2020, under Notice 2020-23.) In addition, the notice provides that the period between April 1, 2020, and December 31, 2020, is suspended for purposes of the 30-month period during which property may be substantially improved. The guidance also provides that, due to the COVID-19 pandemic, a QOF's failure to hold less than the 90% of its assets in Qualified Opportunity Zone Property on any semi-annual testing dates from April 1, 2020, through Dec. 31, 2020, is due to reasonable cause under section 1400Z-2(f)(3) and such failure does not prevent qualification of an entity as a QOF or an investment in a QOF from being a qualifying investment. As such, the QOF will not be liable for the statutory penalty under section 1400Z-2(f) due to such a failure during this period. For Qualified Opportunity Zone Business projects that meet the requirements of the 31-month working capital safe harbor under the final regulations, the notice reminds taxpayers that due to the COVID-19 pandemic these projects have up to an additional 24 months in which to expend their working capital. Similarly, the notice reminds taxpayers that due to the COVID-19 pandemic, QOFs that received distributions of QOF stock or partnership interests as a return of capital or realized proceeds from a sale of that stock, partnership interest or qualified opportunity zone property have an additional 12 months in which to reinvest those amounts in the manner intended before the COVID-19 pandemic. For more information about tax relief resulting from the COVID-19 pandemic, go to the Coronavirus Tax Relief and Economic Impact Payments page on IRS.gov.

https://www.irs.gov/newsroom/interest-rates-decrease-for-the-third-quarter-of-2020

IR-2020-113, June 4, 2020 WASHINGTON — The Internal Revenue Service today announced that interest rates will decrease for the calendar quarter beginning July 1, 2020. The rates will be:  three (3) percent for overpayments [two (2) percent in the case of a corporation];   one-half (0.5) percent for the portion of a corporate overpayment exceeding $10,000;   three (3) percent for underpayments; and   five (5) percent for large corporate underpayments. 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 determined during April 2020 to take effect May 1, 2020, based on daily compounding. Revenue Ruling 2020-13 PDF, announcing the rates of interest, is attached and will appear in Internal Revenue Bulletin 2020-26, dated June 22, 2020.

https://www.irs.gov/newsroom/irs-chief-counsel-goes-virtual-with-national-settlement-days-helps-dozens-of-taxpayers-settle-their-tax-court-cases

IR-2020-112, June 4, 2020 WASHINGTON – The Internal Revenue Service Office of Chief Counsel is expanding its Virtual Settlement Days program after the tremendous success achieved by three offices that took Settlement Days events virtual in May 2020. Settlement Days events are coordinated efforts to resolve cases in the United States Tax Court (Tax Court) by providing taxpayers not represented by counsel the opportunity to receive free tax advice from Low Income Taxpayer Clinics (LITCs), American Bar Association (ABA) volunteer attorneys and other pro bono organizations. Taxpayers can also discuss their Tax Court cases and resolve related tax issues with members of the IRS Office of Chief Counsel, the Independent Office of Appeals and Collection. By doing so, unrepresented taxpayers are often able to amicably settle their tax disputes without a trial. In response to office closures and social distancing requirements, the Office of Chief Counsel quickly shifted its Settlement Days event to a virtual environment. Settlement Days events have traditionally been held in-person, requiring LITC staffers, pro bono attorneys and taxpayers to travel to a designated meeting location. Virtual Settlement Days events take advantage of WebEx audio-visual conferencing software to allow taxpayers to join events from any location, including their homes. The Office of Chief Counsel first announced its shift to Virtual Settlement Days on May 5, 2020. (See IR-2020-87.) As part of that, Virtual Settlement Days events were held on May 9 in Detroit in conjunction with the University of Michigan Law School LITC, and on May 21 in Atlanta in conjunction with the North Georgia Low Income Taxpayer Clinic. "The response to these programs has been overwhelming, and it encouraged us to expand this initiative to help more people," said IRS Chief Counsel Mike Desmond. The Detroit office expanded its event to eight days. The Atlanta office expanded to two events, one in May and one in June. Between them, the Detroit and Atlanta offices resolved the cases of more than 50 taxpayers. Now, the Office of Chief Counsel is expanding Virtual Settlement Days to other offices and hosting events more frequently. "Virtual settlement days represent a continuing effort by the IRS to deliver meaningful resolution options to taxpayers, especially during these difficult times," IRS Commissioner Chuck Rettig said. "Virtual options represent an addition to traditional methods of communication and resolution, not a replacement. The IRS strives to assist every taxpayer, including many who do not have the ability to interact in a virtual environment. The IRS is open to innovative approaches like the virtual settlement days to help people. We welcome comments from taxpayers and others regarding additional methods by which the IRS can ease the burdens on people of our country facing tax issues." The Office of Chief Counsel's Los Angeles office held its first Virtual Settlement Day on May 26, and now also has events scheduled for June 5, 9, 19 and 23, as well as July 7, 17 and 21. The Los Angeles office is working with six different LITCs to support these events. The Atlanta office also has additional events scheduled for June 16 and 17. The Office of Chief Counsel's Washington, D.C., office is inviting more than 60 unrepresented taxpayers to participate in its first Virtual Settlement Day on June 20, in conjunction with Catholic University Law Columbus Community Legal Services Low-Income Tax Clinic, American University Law Janet R. Spragens Federal Tax Clinic, and Morgan Lewis Center for Public Interest Tax Law and Legal Services of Northern Virginia. "The success of Virtual Settlement Days is only possible thanks to the strong partnership between the Office of Chief Counsel, LITCs and pro bono attorneys," Desmond said. The Office of Chief Counsel looks forward to organizing more Virtual Settlement Days in the coming weeks. The IRS encourages unrepresented taxpayers with active Tax Court cases to contact the assigned Chief Counsel attorney or paralegal about participating in a Virtual Settlement Days event. If a taxpayer's case is currently under consideration by the IRS Independent Office of Appeals, the taxpayer should contact the assigned Appeals Officer to discuss case resolution.

https://www.irs.gov/newsroom/159-million-economic-impact-payments-processed-low-income-people-and-others-who-arent-required-to-file-tax-returns-can-quickly-register-for-payment-with-irs-non-filers-tool

IR-2020-111, June 3, 2020 WASHINGTON — With 159 million Economic Impact Payments processed, the Internal Revenue Service reminds many low-income Americans who don't usually file tax returns to register for a payment by October 15. Millions of low-income people and others who aren't required to file a tax return may be eligible for an Economic Impact Payment and can easily register for a payment by using the free Non-Filers tool, available only on IRS.gov. "IRS employees worked around the clock to deliver the Economic Impact Payments and new tools to help taxpayers in record time," said IRS Commissioner Chuck Rettig. "Even with these unprecedented steps, there remain people eligible for these payments who need to take action. Registering to receive the payments is easy, and millions of non-filers have already taken this step. We urge everyone to share this information widely to help more people receive these payments." In the past two months, more than 159 million Americans have received Economic Impact Payments totaling almost $267 billion. Of the payments, 120 million were sent to Americans by direct deposit, 35 million by check and 4 million payments were made in the form of a pre-paid debit card. This includes payments sent to those who usually do not have to file a tax return but receive retirement, survivor or disability benefits under various programs administered by the Social Security Administration as well as the Department of Veterans Affairs and the Railroad Retirement Board who qualify. These individuals can use Get My Payment to check on their payment status. Non-Filers tool on IRS.gov helps millions; special feature remains available through October 15 To help people who aren't normally required to file a tax return, the IRS created the Non-Filers tool, available in English and Spanish, in partnership with the Free File Alliance. The Non-Filers tool is designed for people with incomes typically below $24,400 for married couples, and $12,200 for singles. This includes couples and individuals who are homeless. People can qualify, even if they do not have earned income or work. Usually, married couples qualify to receive a $2,400 payment while others normally qualify to get $1,200. People with qualifying children under 17 can get up to an additional $500 for each child. Anyone who already filed either a 2018 or 2019 return does not qualify to use this tool. The Non-Filers tool will remain available through the summer and fall, though many eligible people without a filing obligation have already received an Economic Impact Payment. The IRS urges every other eligible non-filer to register soon to quickly receive their payment. Anyone who registers by October 15 will receive their payment by the end of the year. To help reach these non-filers, over the next few months the IRS will be conducting an extensive outreach and education effort to partner groups who serve homeless individuals, underserved communities, limited English households and others. As part of this effort, the agency has created an Economic Impact Payment partner page, and materials are available in multiple languages. The IRS cautions that some people who need to file a tax return have been mistakenly using the Non-Filers tool to try to get an Economic Impact Payment. For more Information on the Economic Impact Payment, including answers to frequently-asked questions and other resources, visit IRS.gov/coronavirus.

https://www.irs.gov/newsroom/irs-provides-relief-to-retirement-plan-participants-to-sign-elections-remotely

Updated 12/22/20:  The IRS has extended this relief until June 30, 2021, See Notice 2021-03PDF. IR-2020-110, June 3, 2020 WASHINGTON — The Internal Revenue Service today provided temporary administrative relief to help certain retirement plan participants or beneficiaries who need to make participant elections by allowing flexibility for remote signatures. The change relates to signatures of the individual making the election to be witnessed in the physical presence of a plan representative or notary public, including a spousal consent ("the physical presence requirement"). Notice 2020-42 PDF provides participants, beneficiaries, and administrators of qualified retirement plans and other tax-favored retirement arrangements with temporary relief from the physical presence requirement for any participant election (1) witnessed by a notary public in a state that permits remote notarization, or (2) witnessed by a plan representative using certain safeguards. The guidance accommodates local shutdowns and social distancing practices and is intended to facilitate the payment of coronavirus-related distributions and plan loans to qualified individuals, as permitted by the CARES Act. Under today's guidance, in the case of a participant election witnessed by a notary public, for the period from Jan. 1, 2020, through Dec. 31, 2020, the individual may use an electronic system facilitating remote notarization if executed via live audio-video technology that otherwise satisfies the requirements of participant elections and that is consistent with state law requirements that apply to the notary public. For the same period, in the case of a participant election witnessed by a plan representative, the individual may use an electronic system using live audio-video technology if the following requirements are satisfied: The individual must be effectively able to access the electronic medium used to make the participant election; The electronic system must be reasonably designed to preclude any person other than the appropriate individual from making the participant election; The electronic system must provide the individual making the election with a reasonable opportunity to review, confirm, modify, or rescind the terms of the election before it becomes effective; and The individual making the election, within a reasonable time, must receive confirmation of the election through either a written paper document or an electronic medium under a system that satisfies the applicable notice requirements. Additional information about tax relief for those affected by the COVID-19 pandemic can be found on IRS.gov.

https://www.irs.gov/newsroom/irs-reminder-june-15-tax-deadline-postponed-to-july-15-for-taxpayers-who-live-and-work-abroad

IR-2020-109, June 2, 2020 WASHINGTON – The Internal Revenue Service today reminded people who live and work abroad that they have until Wednesday, July 15, 2020, to file their 2019 federal income tax return and pay any tax due. The usual deadline is June 15. This extension was included in a wide range of Coronavirus-related relief announced in early April. The extension generally applies to all taxpayers who have an income tax filing or payment deadline falling on or after April 1, 2020, and before July 15, 2020. This means that anyone, including Americans who live and work abroad, nonresident aliens and foreign entities with a U.S. filing and payment requirement, have until July 15 to file their 2019 federal income tax return and pay any tax due. Visit IRS.gov/coronavirus for details. Need more time beyond July 15? Individual taxpayers who need additional time to file beyond the July 15 deadline can request a filing extension to Oct. 15 in one of two ways: Filing Form 4868 through their tax professional, tax software or using the Free File link on IRS.gov. Submitting an electronic payment with Direct Pay, Electronic Federal Tax Payment System or by debit, credit card or digital wallet options and selecting Form 4868 or extension as the payment type. The automatic extension of time to file will process when taxpayers pay all or part of their taxes, electronically, by the July 15 due date. An extension to file is not an extension to pay. Taxes are still due by July 15. Businesses that need additional time to file income tax returns must file Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns. Combat zone extension Members of the military qualify for an additional extension of at least 180 days to file and pay taxes if either of the following situations apply: They serve in a combat zone or they have qualifying service outside of a combat zone or They serve on deployment outside the United States away from their permanent duty station while participating in a contingency operation. This is a military operation that is designated by the Secretary of Defense or results in calling members of the uniformed services to active duty (or retains them on active duty) during a war or a national emergency declared by the President or Congress. Deadlines are also extended for individuals serving in a combat zone or a contingency operation in support of the Armed Forces. This applies to Red Cross personnel, accredited correspondents, and civilian personnel acting under the direction of the Armed Forces in support of those forces. Spouses of individuals who served in a combat zone or contingency operation are generally entitled to the same deadline extensions with some exceptions. Extension details and more military tax information is available in IRS Publication 3, Armed Forces' Tax Guide. IRS.gov assistance 24/7 Tax help is available 24/7 on IRS.gov. The IRS website offers a variety of online tools to help taxpayers answer common tax questions. For example, taxpayers can search the Interactive Tax Assistant, Tax Topics, Frequently Asked Questions, and Tax Trails to get answers to common questions. Go to IRS.gov/payments for electronic payment options. More information The IRS will post frequently asked questions on IRS.gov/coronavirus and will provide updates as soon as they are available. About Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad About Publication 519, U.S. Tax Guide for Aliens IRS.gov/covidtaxdeadlines

https://www.irs.gov/newsroom/irs-issues-proposed-regulations-for-tcjas-simplified-tax-accounting-rules-for-small-businesses

IR-2020-174, July 30, 2020 WASHINGTON — The Internal Revenue Service today issued proposed regulationsPDF updating various tax accounting regulations to adopt the simplified tax accounting rules for small businesses under the Tax Cuts and Jobs Act (TCJA). For tax years beginning in 2019 and 2020, these simplified tax accounting rules apply for taxpayers having inflation-adjusted average annual gross receipts of $26 million or less (known as the gross receipts test). Taxpayers classified as tax shelters cannot use the simplified rules even if they would meet the gross receipts test. Prior to the TCJA, certain taxpayers could determine whether they were eligible to figure taxable income under the cash method of accounting by meeting a different gross receipts test. That gross receipts test was met if the taxpayer's average annual gross receipts for all prior taxable years did not exceed $5 million. After the TCJA, a taxpayer meets the gross receipts test and can use the cash method if average annual gross receipts for the three-taxable year period ending immediately before the current taxable year are $25 million (adjusted for inflation) or less. The TCJA also exempted taxpayers meeting the gross receipts test from the uniform capitalization rules. Tax reform also added an exception to the requirement to use an inventory method if their inventory is treated as non-incidental materials and supplies, or in accordance with the applicable financial statement (AFS). If they do not have an AFS, taxpayers can use their books and records. The proposed regulations issued today implement these statutory changes and provide clarifying definitions. The proposed regulations issued today also provide guidance for small businesses with long-term construction contracts and the requirements for exemption from the percentage-of-completion method and the uniform capitalization rules. For taxpayers with income from long-term contracts reported under the percentage-of-completion method, guidance is provided for applying the look-back method after repeal of the corporate alternative minimum tax and enactment of the base erosion and anti-abuse tax (BEAT). For more information about this and other TCJA provisions, visit IRS.gov/taxreform.

https://www.irs.gov/newsroom/irs-grants-additional-relief-for-rehabilitation-credit-deadlines

IR-2020-173, July 30, 2020 WASHINGTON — Because of the burdens the COVID-19 pandemic has placed on taxpayers claiming the rehabilitation credit, the Internal Revenue Service today issued Notice 2020-58PDF that provides additional relief to taxpayers in satisfying the substantial rehabilitation test. Projects must satisfy the "substantial rehabilitation test" within a 24- or 60-month period for determining whether the rehabilitation work is sufficient to qualify a building for the rehabilitation credit. The Tax Cuts and Jobs Act (TJCA) generally requires the rehabilitation credit to be claimed over a five-year period for amounts that taxpayers pay or incur for qualified rehabilitation expenditures after December 31, 2017. However, taxpayers may claim the credit all in one year under pre-TCJA rules for projects that qualify under a transition rule. The notice issued today allows taxpayers that have a measuring period under the substantial rehabilitation test ending on or after April 1, 2020, and before March 31, 2021, now have until March 31, 2021 to satisfy the test. This relief applies to the substantial rehabilitation test for claiming the credit or qualifying under the TCJA transition rule. Previously, the IRS issued Notice 2020-23PDF that provided additional time for satisfying the substantial rehabilitation test. Additional tax relief related to the COVID-19 pandemic can be found on IRS.gov.

https://www.irs.gov/newsroom/irs-new-law-provides-relief-for-eligible-taxpayers-who-need-funds-from-iras-and-other-retirement-plans

IR-2020-172, July 29, 2020 WASHINGTON — The Internal Revenue Service provided a reminder today that the Coronavirus Aid, Relief, and Economic Security (CARES) Act can help eligible taxpayers in need by providing favorable tax treatment for withdrawals from retirement plans and IRAs and allowing certain retirement plans to offer expanded loan options. Can I get money from my retirement account now? Under the CARES Act, individuals eligible for coronavirus-related relief may be able to withdraw up to $100,000 from IRAs or workplace retirement plans before December 31, 2020, if their plans allow. In addition to IRAs, this relief applies to 401(k) plans, 403(b) plans, profit-sharing plans and others. These coronavirus-related withdrawals: May be included in taxable income either over a three-year period (one-third each year) or in the year taken, at the individual's option.   Are not subject to the 10% additional tax on early distributions that would otherwise apply to most withdrawals before age 59½,   Are not subject to mandatory tax withholding, and   May be repaid to an IRA or workplace retirement plan within three years. Can I take out a loan? Individuals eligible to take coronavirus-related withdrawals may also, until September 22, 2020, be able to borrow as much as $100,000 (up from $50,000) from a workplace retirement plan, if their plan allows. Loans are not available from an IRA. For eligible individuals, plan administrators can suspend, for up to one year, plan loan repayments due on or after March 27, 2020, and before January 1, 2021. A suspended loan is subject to interest during the suspension period, and the term of the loan may be extended to account for the suspension period. Taxpayers should check with their plan administrator to see if their plan offers these expanded loan options and for more details about these options. Who is eligible? To be eligible for COVID-19 relief, coronavirus-related withdrawals or loans can only be made to an individual if: The individual is diagnosed with the virus SARS-CoV-2 or with coronavirus disease 2019 (collectively, COVID-19) by a test approved by the Centers for Disease Control and Prevention (including a test authorized under the Federal Food, Drug, and Cosmetics Act);   The individual's spouse or dependent is diagnosed with COVID-19 by such a test; or   The individual experiences adverse financial consequences as a result of:   The individual being quarantined, being furloughed or laid off, having work hours reduced, being unable to work due to lack of childcare, having a reduction in pay (or self-employment income), or having a job offer rescinded or start date for a job delayed, due to COVID-19; The individual's spouse or a member of the individual's household (that is, someone who shares the individual's principal residence) being quarantined, being furloughed or laid off, having work hours reduced, being unable to work due to lack of childcare, having a reduction in pay (or self-employment income), or having a job offer rescinded or start date for a job delayed, due to COVID-19; or Closing or reducing hours of a business owned or operated by the individual, the individual's spouse, or a member of the individual's household, due to COVID-19. Where can I find more information? Retirement plan recipients can learn more about these provisions in IRS Notice 2020-50 PDF. The IRS has also posted FAQs that provide additional information regarding this relief. Additional information on the CARES Act and retirement plans, as well as updates, other FAQs, and other information can be found at IRS.gov/coronavirus.

https://www.irs.gov/newsroom/irs-issues-final-regulations-and-other-guidance-on-business-interest-expense-deduction-limitation

IR-2020-171, July 28, 2020 WASHINGTON — The Internal Revenue Service issued final regulationsPDF regarding the provision of the Tax Cuts and Jobs Act that limits the deduction for business interest expense, including basic statutory amendments made by the CARES Act. For tax years beginning after December 31, 2017, business interest expense deductions are generally limited to the sum of: the taxpayer's business interest income; 30 percent (or 50 percent, as applicable) of the taxpayer's adjusted taxable income; and the taxpayer's floor plan financing interest expense. The business interest expense deduction limitation does not apply to certain small businesses whose gross receipts are $26 million or less, electing real property trades or businesses, electing farming businesses, and certain regulated public utilities. The $26 million gross receipts threshold applies for the 2020 tax year and will be adjusted annually for inflation. A real property trade or business or a farming business may elect to be excepted from the business interest expense limitation. However, taxpayers cannot claim the additional first-year depreciation deduction for certain types of property held by the electing trade or business. Taxpayers use Form 8990, Limitation on Business Interest Expense Under Section 163(j), to calculate and report their deduction and the amount of disallowed business interest expense to carry forward to the next tax year. Along with the final regulations, the IRS today issued the following additional items of guidance related to the business interest expense deduction limitation. Proposed RegulationsPDF that provide additional guidance on various business interest expense deduction limitation issues not addressed in the final regulations, including more complex issues related to the amendments made by the CARES Act. Subject to certain restrictions, taxpayers may rely on some of the rules in these proposed regulations until final regulations implementing the proposed regulations are published in the Federal Register. Written or electronic comments and requests for a public hearing on these proposed regulations must be received within 60 days of date of filing for public inspection with the Federal Register. Notice 2020-59 PDF contains a proposed revenue procedure that provides a safe harbor allowing taxpayers engaged in a trade or business that manages or operates qualified residential living facilities to treat such trade or business as a real property trade or business solely for purposes of qualifying as an electing real property trade or business. Written or electronic comments on the proposed revenue procedure must be received no later than Monday, September 28, 2020. FAQs Regarding the Aggregation Rules Under Section 448(c)(2) that Apply to the Section 163(j) Small Business Exemption provide a general overview of the aggregation rules that apply for purposes of the gross receipts test, and that apply to determine whether a taxpayer is a small business that is exempt from the business interest expense deduction limitation. For more information about this and other TCJA provisions, visit IRS.gov/taxreform

https://www.irs.gov/newsroom/working-virtually-use-multi-factor-authentication-to-protect-accounts-part-2-of-security-summit-tips-for-tax-professionals

IR-2020-170, July 28, 2020 WASHINGTON — With heightened threats during COVID-19, the Internal Revenue Service and Security Summit partners today called on tax professionals to select multi-factor authentication options whenever possible to prevent identity thieves from gaining access to client accounts. Starting in 2021, all tax software providers will be required to offer multi-factor authentication options on their products that meet higher standards. Many already do so. A multi-factor or two-factor authentication offers an extra layer of protection for the username and password used by the tax professional. It often involves a security code sent via text. Using multi-factor authentication is the second in a five-part series called Working Virtually: Protecting Tax Data at Home and at Work. The public awareness initiative by the IRS, state tax agencies and the private-sector tax industry – working together as the Security Summit – spotlights basic security steps for all practitioners, but especially those working remotely or social distancing in response to COVID-19. "Cybercriminals continue to find new ways to try accessing tax professional and taxpayer data. The multi-factor authentication option is an easy, free way to really step up protection of client data," said IRS Commissioner Chuck Rettig. "All tax software products will make it a feature, and it's part of a larger effort to protect taxpayers and the tax community." Of the numerous data thefts reported to the IRS from tax professional offices this year, most could have been avoided had the practitioner used multi-factor authentication to protect tax software accounts. Thieves use a variety of scams – but most commonly by a phishing email – will download malicious software, such as keystroke software. This malware will eventually enable them to steal all passwords from a tax pro. Once the thief has accessed the practitioner's networks and tax software account, they will complete pending taxpayer returns, alter refund information and use the practitioner's own e-filing and preparer numbers to file the fraudulent return. However, with multi-factor authentication, it's unlikely the thief will have stolen the practitioner's cell phone so he would not receive the necessary security code to access the account. This protects the tax pro's account information. Practitioners can download to their mobile phones readily available authentication apps offered through Google Play or the Apple Store. These apps will generate a security code. Codes also may be sent to practitioner's email or text but those are not as secure as the authentication apps. Use a search engine for "Authentication apps" to learn more. In additional to tax software accounts, practitioners should use multi-factor authentication wherever it is offered. For example, cloud storage providers and commercial email products offer multi-factor protections as do social media outlets. IRS e-Services is an example of an account using multi-factor authentication. Additional resources Tax professionals also can get help with security recommendations by reviewing the recently revised IRS Publication 4557, Safeguarding Taxpayer DataPDF, and Small Business Information Security: The FundamentalsPDF by the National Institute of Standards and Technology. Publication 5293, Data Security Resource Guide for Tax ProfessionalsPDF, provides a compilation data theft information available on IRS.gov. Also, tax professionals should stay connected to the IRS through subscriptions to e-News for Tax Professionals and Social Media or visit IRS.gov/identitytheft.

https://www.irs.gov/newsroom/irs-provides-guidance-on-recapturing-excess-employment-tax-credits

IR-2020-169, July 27, 2020 WASHINGTON — The Internal Revenue Service issued a temporary regulation and a proposed regulation to reconcile advance payments of refundable employment tax credits and recapture the benefit of these credits when necessary. The regulations authorize the assessment of erroneous refunds of the credits paid under both the Families First Coronavirus Response Act (Families First Act) and Coronavirus Aid, Relief and Economic Security Act (CARES Act). The Families First Act generally requires employers with fewer than 500 employees to provide paid sick leave for up to 80 hours and paid family leave for up to 10 weeks if the employee is unable to work or telework due to COVID-19 related reasons. Eligible employers are entitled to fully refundable tax credits to cover the cost of the leave required to be paid. The CARES Act provides an additional credit for employers experiencing economic hardship due to COVID-19. Eligible employers who pay qualified wagesto their employees are entitled to an employee retention credit. The IRS has revised or is in the process of revising the Form 941, Form 943, Form 944 and Form CT-1, so that employers may use these returns to claim the paid sick and family leave and employee retention credits. Employers may also receive advance payment of the credits up to the total allowable amounts. The IRS has created Form 7200, Advance Payment of Employer Credits Due To COVID-19, which employers may use to request an advance of the credits. Employers are required to reconcile any advance payments claimed on Form 7200 with total credits claimed and total taxes due on their employment tax returns. Any refund of these credits paid to a taxpayer that exceeds the amount the taxpayer is allowed is an erroneous refund. The regulations released today authorize the assessment and collection of any erroneous refund of the credits in the normal course of processing the applicable employment tax returns or Forms 7200. This allows the IRS to efficiently recover any refund, while preserving administrative protections for taxpayers. For more information on the employer credits, see Employer Tax Credits.

https://www.irs.gov/newsroom/irs-reminds-businesses-filing-cash-transaction-reports-about-e-file-option-batch-filing-now-available

IR-2020-168, July 22, 2020 WASHINGTON — The Internal Revenue Service reminds businesses required to file reports of large cash transactions that e-filing is a fast, easy and secure option for filing their reports. Now, businesses can batch file their reports, which is especially helpful to those required to file many forms. Although businesses have the option of filing Form 8300, Report of Cash Payments Over $10,000, on paper, many have already found the free and secure e-filing system is a more convenient and cost-effective way to meet the reporting deadline. The form is due 15 days after a transaction and there's no charge for the e-file option. Although many cash transactions are legitimate, information reported on this form can help stop those who evade taxes, profit from the drug trade, engage in terrorist financing and conduct other criminal activities. The government can often trace money from these illegal activities through the payments reported on Form 8300 and other cash reporting forms. Businesses that file Form 8300 electronically get free, automatic acknowledgment of receipt when they file. In addition, electronic filing is more accurate, reducing the need for follow-up correspondence with the IRS. To file Form 8300 electronically, a business must set up an account with FinCEN's BSA E-Filing System. For more information, interested businesses can call the BSA E-Filing Help Desk at 866-346-9478 or email them at bsaefilinghelp@fincen.gov. The help desk is available Monday through Friday from 8 a.m. to 6 p.m. Eastern time. For more information about the reporting requirement, see FS-2020-11, Reporting cash transactions helps government combat criminal activities, available on IRS.gov.

https://www.irs.gov/newsroom/working-virtually-protect-tax-data-at-home-and-at-work-with-the-security-six-part-1-of-security-summit-tips-for-tax-professionals

IR-2020-167, July 21, 2020 WASHINGTON — With cyberthieves active during COVID-19, the Internal Revenue Service and the Security Summit partners today urged tax professionals to review critical security steps to ensure they are fully protecting client data whether working in the office or a remote location. Many tax professionals have expanded telework options this year as firms, like other businesses, work to keep personnel safe, practice recommended safety guidelines and use technology to virtually serve their clients. During this period, the Department of Homeland Security's Cybersecurity and Infrastructure Security Agency (CISA) have urged organizations to maintain a heightened state of alert as cybercriminals seek to exploit Covid-19 concerns. To assist tax professionals with the security basics, the IRS, state tax agencies and nation's tax industry are launching a five-part series called Working Virtually: Protecting Tax Data at Home and at Work. The special series is designed to help practitioners assess their home and office data security. The first recommendation today covers the "Security Six" – basic steps that should be taken for every work location. The series will continue each Tuesday through August 18. "The Security Summit partners urge tax professionals to take time this summer to give their data safeguards a thorough review and ensure that these protections are in place whether they work from home or the office," said IRS Commissioner Chuck Rettig. Although the Security Summit – a partnership between the IRS, states and the private-sector tax community – is making major progress against tax-related identity theft, cybercriminals continue to evolve. They are aware that tax practitioners and their systems may be more vulnerable this year during COVID-19, especially if they are working remotely. The following are the basic "Security Six" protections that everyone, especially tax professionals handling sensitive data, should use: 1. Anti-virus software Although details may vary between commercial products, anti-virus software scans computer files or memory for certain patterns that may indicate the presence of malicious software (also called malware). Anti-virus software (sometimes more broadly referred to as anti-malware software) looks for patterns based on the signatures or definitions of known malware from cybercriminals. Anti-virus vendors find new issues and malware daily, so it is important that people have the latest updates installed on their computer. Once users have installed an anti-virus package, they should scan their entire computer regularly by doing: Automatic scans – Most anti-virus software can be configured to automatically scan specific files or directories in real time and prompt users at set intervals to perform complete scans. Manual scans – If the anti-virus software does not automatically scan new files, users should manually scan files and media received from an outside source before opening them. This manual process includes: Saving and scanning email attachments or web downloads rather than opening them directly from the source. Scanning portable media, including CDs, for malware before opening files. Sometimes the software will produce a dialog box with an alert that it has found malware and asks whether users want it to "clean" the file (to remove the malware). In other cases, the software may attempt to remove the malware without asking first. When selecting an anti-virus package, tax professionals should learn about its features, so they know what to expect. Remember, keep security software set to automatically receive the latest updates so that it is always current. A reminder about spyware, a category of malware intended to steal sensitive data and passwords without the user's knowledge: Strong security software should protect against spyware. But remember, never click links within pop-up windows, never download "free" software from a pop-up, and never follow email links that offer anti-spyware software. The links and pop-ups may be installing the spyware they claim to be eliminating. A reminder about phishing emails: A strong security package also should contain anti-phishing capabilities. Never open an email from a suspicious source, click on a link in a suspicious email or open an attachment – to avoid being the victim of a phishing attack and having clients' and firm data compromised. 2. Firewalls Firewalls provide protection against outside attackers by shielding a computer or network from malicious or unnecessary web traffic and preventing malicious software from accessing systems. Firewalls can be configured to block data from certain suspicious locations or applications while allowing relevant and necessary data to pass through, according to CISA. Firewalls may be broadly categorized as hardware or software. While both have their advantages and disadvantages, the decision to use a firewall is far more important than deciding which type used: Hardware – Typically called network firewalls, these external devices are positioned between a computer and the internet (or another network connection). Hardware-based firewalls are particularly useful for protecting multiple computers and control the network activity that attempts to pass through them. Software – Most operating systems include a built-in firewall feature that should be enabled for added protection even if using an external firewall. Firewall software can also be obtained as separate software from a local computer store or software vendor. If downloading firewall software from the internet, make sure it is from a reputable source (such as an established software vendor or service provider) and offered via a secure website. While properly configured firewalls may be effective at blocking some cyber-attacks, don't be lulled into a false sense of security. Firewalls do not guarantee that a computer will not be attacked. Firewalls primarily help protect against malicious traffic, not against malicious programs (malware), and may not protect the device if the user accidentally installs malware. However, using a firewall in conjunction with other protective measures (such as anti-virus software and safe computing practices) will strengthen resistance to attacks. The Security Summit reminds tax pros that anti-virus software and firewalls cannot protect data if employees fall for email phishing scams and divulge sensitive data, such as usernames and passwords. The Summit reminds the tax community that users, not the software, is the first line of defense in protecting taxpayer data. 3. Two-factor authentication Tax software providers, email providers and others that require online accounts now offer customers two-factor authentication protections to access email accounts. Tax professionals should always use this option to prevent their accounts from being taken over by cybercriminals and putting their clients and colleagues at risk. Two-factor authentication helps by adding an extra layer of protection beyond a password. Often two-factor authentication means the returning user must enter credentials (username and password) plus another step, such as entering a security code sent via text to a mobile phone. The idea is a thief may be able to steal the username and password but it's highly unlikely they also would have a user's mobile phone to receive a security code and complete the process. The use of two-factor authentication and even three-factor authentication is on the rise, and tax preparers should always opt for a multi-factor authentication protection when it is offered, whether on an email account, tax software account or any password-protected product. IRS Secure Access, which protects IRS.gov tools including e-Services, is an example of two-factor authentication. Using the two-factor authentication options offered by tax software providers is critical to protect client data stored within those systems. Tax pros also can check their email account settings to see if the email provider offers two-factor protections. 4. Backup software/services Critical files on computers should routinely be backed up to external sources. This means a copy of the file is made and stored either online as part of a cloud storage service or similar product. Or, a copy of the file is made to an external disk, such as an external hard drive with multiple terabytes of storage capacity. Tax professionals should ensure that taxpayer data that is backed up also is encrypted – for the safety of the taxpayer and the tax pro. 5. Drive encryption Given the sensitive client data maintained on tax practitioners' computers, users should consider drive encryption software for full-disk encryption. Drive encryption, or disk encryption, transforms data on the computer into unreadable files for an unauthorized person accessing the computer to obtain data. Drive encryption may come as a stand-alone security software product. It may also include encryption for removable media, such as a thumb drive and its data. 6. Virtual Private Network This is critical for practitioners who work remotely. If a tax firm's employees must occasionally connect to unknown networks or work from home, establish an encrypted Virtual Private Network (VPN) to allow for a more secure connection. A VPN provides a secure, encrypted tunnel to transmit data between a remote user via the Internet and the company network. Search for "Best VPNs" to find a legitimate vendor; major technology sites often provide lists of top services. How to get started with the "Security Six" All tax professionals also should review their professional insurance policy to ensure the business is protected should a data theft occur. Some insurance companies will provide cybersecurity experts for their clients. These experts can help with technology safeguards and offer more advanced recommendations. Having the proper insurance coverage is a common recommendation from tax professionals who have experienced data thefts. Additional resources Tax professionals also can get help with security recommendations by reviewing the recently revised IRS Publication 4557, Safeguarding Taxpayer DataPDF, and Small Business Information Security: The FundamentalsPDF by the National Institute of Standards and Technology. Publication 5293, Data Security Resource Guide for Tax ProfessionalsPDF, provides a compilation data theft information available on IRS.gov. Also, tax professionals should stay connected to the IRS through subscriptions to e-News for Tax Professionals and Social Media or visit Identity Theft Central at IRS.gov/identitytheft.

https://www.irs.gov/newsroom/irs-creates-new-enterprise-digitalization-and-case-management-office-smith-abold-labreche-to-serve-as-co-directors

IR-2020-166, July 21, 2020 WASHINGTON — The Internal Revenue Service announced today the creation of the new Enterprise Digitalization and Case Management office, which will spearhead IRS efforts to empower taxpayers and IRS employees to rapidly resolve issues in a simplified digital environment. The office's efforts will support overall IRS modernization and implementation of long-term changes stemming from the Taxpayer First Act. Serving as co-directors of the new office will be Hampden "Harrison" Smith, IV, currently the agency's Deputy Chief Procurement Officer, and Justin Lewis Abold-LaBreche, who is the Director of Enterprise Case Management. The new stand-alone office will focus on enhancing the taxpayer experience by improving business processes and modernizing systems. The office will apply agile, customer-centered thinking and draw on leading industry test-and-learn practices to rapidly identify what combination of business process and technology works best for the IRS's customers and employees. In the digitalization space, a portfolio-based approach will be utilized for the challenges the IRS faces, in the form of multiple small pilot projects for business process changes and technology solutions. The pilots will be focused on a desired outcome instead of a prescriptive approach, and they will be scaled and funded as they demonstrate value and return on investment. In the case management space, the office procured a commercial-off-the-shelf platform earlier this year from Pegasystems Inc., and its first release is well underway. The IRS has had a dedicated team focused on the Enterprise Case Management initiative, which is focused on standing up a consolidated enterprise case management approach to overcome the challenges the IRS currently faces from having case work taking place on more than 60 aging systems, most of which can't talk with one another. As the team continued its work, it became clear that the digitalization of processes as well as paper, including items such as case files, was an integral part of improving overall case management and the mission of the agency. "Ultimately, you cannot improve case management without improving the digitalization of paper records," said Jeff Tribiano, Deputy Commissioner for Operations Support. "To reflect the importance of this area, we decided to establish this new office to help focus our efforts on moving forward." The office will report to both Tribiano and Sunita Lough, the Deputy Commissioner for Services and Enforcement. Staffing for the new office is still being determined, and employees currently working on case management issues will continue in their current roles. "This new office reflects an agency-wide priority," Lough said. "To help this effort, we turned to Harrison and Justin, who bring a variety of skills and expertise to help us navigate this challenging area that holds promise for improved service and efficiency for both taxpayers and the IRS." Smith has served as the deputy in the IRS procurement office since July 2019 and has recently been focused on the application of automation and machine learning technologies in the procurement space. Prior to joining the IRS, he served as the Industry Liaison for the Department of Homeland Security (DHS), where he focused on industry engagement, innovation labs, and creative pricing arrangements, and also served as a principal adviser to the DHS Chief Procurement Officer. Smith has 15 years of operational procurement experience with various DHS offices and the Naval Sea Systems Command. A former Presidential Management Fellow, Smith also worked on policy and strategic analysis positions in Congress. He holds a B.A. in International Relations and an M.A. in US Foreign Policy from The American University, and an M.B.A. from George Washington University. Abold-LaBreche has served as the Director, Enterprise Case Management Office since May 2019. Prior to this assignment, he held executive positions in each of the IRS's business operating divisions including: acting Director, Government Entities and Shared Services, Tax Exempt and Government Entities (TE/GE) Division; Field Director, Accounts Management, Austin in the Wage and Investment (W&I) Division; acting Director of Examination Policy in Small Business/Self-Employed (SB/SE) Division; and Assistant to the Industry Director, Global High Wealth in the Large Business and International (LB&I) Division. Abold-LaBreche also served as the Initiative Director and then acting Director and Senior Advisor to the IRS Commissioner in the Office of Compliance Analytics. Abold-LaBreche also worked in DHS and is a former U.S. Air Force officer. A Fulbright Scholar, he holds a PhD from Oxford University, M.S. in Strategic Intelligence from the National Defense Intelligence College and a B.S. in Applied Mathematics from Yale University.

https://www.irs.gov/newsroom/treasury-irs-issue-final-and-proposed-regulations-on-income-subject-to-a-high-rate-of-foreign-tax

IR-2020-165, July 20, 2020 WASHINGTON — The Department of the Treasury and the Internal Revenue Service today issued a final regulationPDF addressing the treatment of income earned by certain foreign corporations that is subject to a high rate of foreign tax. The final regulations allow taxpayers to exclude certain high-taxed income of a controlled foreign corporation from their Global Intangible Low Taxed Income (GILTI) computation on an elective basis. Treasury and the IRS today also issued a proposed regulationPDF regarding the high-tax exception with the GILTI high-tax exclusion. Treasury and the IRS welcome public comments. Updates on the TCJA can be found on the Tax Reform page of IRS.gov.

https://www.irs.gov/newsroom/irs-advice-for-those-who-missed-the-july-15-deadline-file-now-to-avoid-bigger-bill

IR-2020-164, July 20, 2020 WASHINGTON — For those who missed the July 15 tax deadline and didn't request an extension, the Internal Revenue Service reminds taxpayers about some important tips, including filing electronically as soon as possible to reduce potential penalties. Some taxpayers may have extra time to file and pay any taxes due without penalties and interest. These include: Members of the military who served or are currently in a combat zone. They qualify for an additional extension of at least 180 days to file and pay taxes. Support personnel in combat zones or a contingency operation in support of the Armed Forces. They may also qualify for a filing and payment extension of at least 180 days. Some disaster victims. Those who qualify have more time to file and pay what they owe. The IRS offers these after-tax-day tips: File to get a tax refund The only way to get a refund is to file a tax return. There is no penalty for filing after the deadline if a refund is due. Use electronic filing options including IRS Free File available on IRS.gov through October 15 to prepare and file returns electronically. The IRS reminds taxpayers that, while we continue to process electronic and paper tax returns, issue refunds, and accept payments, we're experiencing delays in processing paper tax returns due to limited staffing. If a taxpayer filed a paper tax return, we will process it in the order we received it. Do not file a second tax return or call the IRS. Taxpayers can track a refund using the Where's My Refund? tool on IRS.gov, IRS2Go and by phone at 800-829-1954. Taxpayers need the primary Social Security number on the tax return, the filing status and the expected refund amount. The tool updates once daily, usually overnight, so checking more frequently will not yield different results. The "Where's My Refund?" tool cannot be used to track Economic Impact Payments. File to reduce penalties and interest Normally, taxpayers should file their tax return, or request an extension, and pay any taxes they owe by the deadline to avoid penalties and interest. Taxpayers need to remember that an extension to file is not an extension to pay. Penalties and interest will apply to taxes owed after July 15. Even if a taxpayer can't afford to immediately pay the taxes they owe, they should still file a tax return as soon as possible to reduce possible penalties. The IRS has more information for taxpayers who owe the IRS, but cannot afford to pay. Ordinarily, the failure-to-file penalty is 5% of the tax owed for each month or part of a month that a tax return is late. But if a return is filed more than 60 days after the due date, the minimum penalty is either $435 or 100% of the unpaid tax, whichever is less. Filing and paying as much as possible is important because the late-filing penalty and late-payment penalty add up quickly. The basic failure-to-pay penalty rate is generally 0.5% of unpaid tax owed for each month or part of a month. For more see IRS.gov/penalties. Taxpayers who have a history of filing and paying on time often qualify for penalty relief. A taxpayer will usually qualify if they have filed and paid timely for the past three years and meet other requirements. For more information, see the first-time penalty abatement page on IRS.gov. Pay taxes due electronically Those who owe taxes can view their balance, pay with IRS Direct Pay, by debit or credit card or apply online for a payment plan, including an installment agreement. Several other electronic payment options are available on IRS.gov/payments. They are secure and easy to use. Taxpayers paying electronically receive immediate confirmation when they submit their payment. With Direct Pay and the Electronic Federal Tax Payment System (EFTPS), taxpayers can opt in to receive email notifications about their payments. Need help? Tips for selecting a tax professional Taxpayers can also look for help from a tax professional. Taxpayers can use several options to help find a tax preparer. One resource is Choosing a Tax Professional, which includes a wealth of consumer guidance for selecting a tax professional. There are various types of tax return preparers, including enrolled agents, certified public accountants, attorneys and some who don't have a professional credential. The Directory of Federal Tax Return Preparers with Credentials and Select Qualifications is a free searchable and sortable database. It includes the name, city, state and zip code of credentialed return preparers who are CPAs, enrolled agents or attorneys, as well as those who have completed the requirements for the IRS Annual Filing Season Program. A search of the database can help taxpayers verify credentials and qualifications of tax professionals or locate a tax professional in their geographic area. Taxpayer Bill of Rights Taxpayers have fundamental rights under the law that protect taxpayers when they interact with the IRS. The Taxpayer Bill of Rights presents these rights in 10 categories. IRS Publication 1, Your Rights as a Taxpayer, highlights these rights and the agency's obligation to protect them.

https://www.irs.gov/newsroom/security-summit-focuses-on-tax-pro-security-during-coronavirus-new-series-on-working-virtually-protecting-tax-data-at-home-and-at-work

IR-2020-163, July 17, 2020 WASHINGTON — The Internal Revenue Service and the Security Summit partners today urged tax professionals this summer to review critical security steps to ensure they are fully protecting client data whether working in the office or a remote location. To help tax practitioners, the IRS, state tax agencies and the nation's tax industry next week will begin a five-part summer awareness initiative called Working Virtually: Protecting Tax Data at Home and at Work. The initiative highlights security actions key to protecting tax professionals as they respond to COVID-19 while working remotely from their office and clients. Taxpayers can also benefit from some of the security tips. "During COVID-19, the community should remember there's more than one virus to be concerned about," said IRS Commissioner Chuck Rettig. "This challenging period creates new opportunities for cybercriminals and new threats for tax professionals. Our latest Security Summit initiative calls on tax professionals to make sure to take precautions to meet the new challenges of the workplace. With more practitioners working from home or dealing with clients via email, it's critical to make sure your security measures are keeping pace." Since the IRS, state tax administrators and the nation's tax industry created the Security Summit five years ago, stolen identity refund fraud has dropped dramatically. Between 2015 and 2019, the number of taxpayers reporting they were identity theft victims to the IRS fell 80%, and the number of confirmed identity theft returns stopped by the IRS declined by 68%. In 2019, there were 443,000 confirmed identity theft tax returns compared to 1.4 million in 2015. As the IRS and Summit partners increased their defenses, cybercriminals have adjusted their sights to focus on tax professionals and their client data. While trying to obtain taxpayer information, data thefts from practitioner offices continue. Tax records and information stolen from preparer offices allow thieves to create fraudulent tax returns that are more difficult to detect. The Security Summit launched the "Protect Your Clients, Protect Yourself" campaign in 2016 to heighten security awareness among tax professionals and their personnel. Security measures are only as good as the least informed employee in the office. In its fourth year, the 2020 campaign will feature a series of news releases each Tuesday for the next five weeks. The campaign will highlight: The "Security Six" − basic protections that all practitioners should take Multi-Factor Authentication to protect accounts Virtual Private Networks to protect remote sites Phishing scams, including COVID-19 and Economic Impact Payments Protect Yourself: The need for a security plan and data theft plan In addition, tax professional security will be a special focus of this year's Nationwide Tax Forums, which will be virtual this year. The sessions begin July 21 and conclude August 20. Additional resources Tax professionals also can get help with security recommendations by reviewing the recently revised IRS Publication 4557, Safeguarding Taxpayer DataPDF, and Small Business Information Security: the FundamentalsPDF by the National Institute of Standards and Technology. Publication 5293, Data Security Resource Guide for Tax ProfessionalsPDF, provides a compilation of data theft information available on IRS.gov. Also, tax professionals should stay connected to the IRS through subscriptions to e-News for Tax Professionals and Social Media or visit Identity Theft Central at IRS.gov/identitytheft.

https://www.irs.gov/newsroom/irs-seniors-retirees-not-required-to-take-distributions-from-retirement-accounts-this-year-under-new-law

IR-2020-162, July 17, 2020 WASHINGTON — The Internal Revenue Service today reminds seniors and retirees that they are not required to take money out of their IRAs and workplace retirement plans this year. The Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, waives required minimum distributions during 2020 for IRAs and retirement plans, including beneficiaries with inherited accounts. This waiver includes RMDs for individuals who turned age 70 ½ in 2019 and took their first RMD in 2020. Roth IRAs do not require withdrawals until after the death of the owner.  What if I already took my RMD? If an individual has already taken an RMD in 2020, including someone who turned 70 ½ during 2019, the individual will have the option of returning the distribution to their account or other qualified plan. Since the RMD rule is suspended, RMDs taken in 2020 are considered eligible for rollover. Therefore, RMDs can be rolled over to another IRA, another qualified retirement plan, or returned to the original plan. An IRA owner or beneficiary who has already received an RMD in 2020 can also repay the distribution to the distributing IRA no later than Aug. 31, 2020, to avoid paying taxes on that distribution. IRS Notice 2020-51PDF also provides that the one rollover per 12-month period limitation and the restriction on rollovers to inherited IRAs do not apply to this repayment. The CARES Act provisions apply to most retirement plans, including traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, 457(b) plans, profit sharing plans and other defined contribution plans. The RMD suspension does not apply to qualified defined benefit plans. Where can I find more information? More information on the CARES Act and retirement plans, including FAQs, can be found on at Coronavirus-related relief for retirement plans and IRAs questions and answers.

https://www.irs.gov/newsroom/irs-debunks-tax-refund-myths

IR-2020-161, July 16, 2020 WASHINGTON ― With the July 15 tax deadline now past, the Internal Revenue Service reminds all taxpayers that there is no secret way to find out when a refund will be issued. Most taxpayers have already filed their federal tax return, and many have already received their refund. Those that have not are understandably eager for details about when their refund will arrive. When it comes to tax refunds, a few common myths keep circulating and misinforming taxpayers. Some key facts can help people understand the refund process better: Taxpayers who file electronically and use direct deposit can expect their refund faster than those who mail a paper return, especially since the COVID-19 outbreak has reduced IRS staffing available to process paper returns. Taxpayers who file a paper tax return are likely to face processing and refund delays. The best and easiest way to check on a refund is Where's My Refund? The Where's My Refund? tool available on IRS.gov and the IRS2Go mobile app. A tax refund's status can be checked within 24 hours after the taxpayer receives the e-file acceptance notification. "Where's My Refund?" is updated once a day, usually overnight. Processing delays for paper tax returns The IRS continues to process electronic and paper tax returns, issue refunds, and accept payments. The IRS is experiencing delays in processing paper tax returns due to limited staffing. This is causing refund delays. Taxpayers who have already filed a paper return should know that the IRS is processing paper returns in the order in which they are received. In addition, interest on individual 2019 refunds reflected on returns filed by July 15, 2020, will generally be paid from April 15, 2020, until the date of the refund. Interest payments may be received separately from the refund and are considered taxable income in the year received. Taxpayers who filed a paper return should not file the same tax return again or call the IRS. Common myths about tax refunds include: Getting a refund this year means there's no need to adjust withholding for 2020 To help avoid a possible surprise next year, taxpayers should look to make changes now. Adjusting tax withholding with an employer can help ensure that neither too much nor too little tax is withheld from an employee's paycheck. The Tax Withholding Estimator helps taxpayers figure out the right amount. Calling the IRS or a tax professional will provide a better refund date Contacting the IRS or a tax professional will not expedite a refund. IRS assistors and tax professionals cannot move up a refund date nor do they have access to any "special" information that will provide a more accurate refund date. Ordering a tax transcript is a secret way to get a refund date Ordering a tax transcript will not help taxpayers find out when they will get their refund and it does not accelerate the issue date of a refund. The Where's My Refund? tool is wrong because there's no deposit date yet When Where's My Refund? shows the tax return status is received it means that we have received the tax return and are processing it. Some returns may take longer to process than others and needs further review. This includes when a return: Includes errors Is incomplete Is affected by identity theft or fraud Includes a Form 8379, Injured Spouse Allocation, which could take up to 14 weeks to process Taxpayers will be contacted by mail if the IRS needs more information to process a tax return. People waiting for a refund in the mail should plan for the additional time a check takes to arrive. Something is wrong when the refund amount is less than expected There are a lot of reasons that cause a tax refund to be different than expected. Situations that could decrease a refund include: Taxpayer math errors or mistakes Owing federal or state taxes, child support, student loans or other federal non-tax obligations A portion of the refund is held while IRS reviews an item claimed on the return The IRS will mail a letter of explanation if these adjustments are made. Some taxpayers may also receive a letter from the Department of Treasury's Bureau of the Fiscal Service if their refund was reduced to offset certain financial obligations. Taxpayers can call the IRS's automated refund hotline at 800-829-1954, which uses the same information as "Where's My Refund?". There is no need to call the IRS unless Where's My Refund? says to do so.

https://www.irs.gov/newsroom/irs-unveils-dirty-dozen-list-of-tax-scams-for-2020-americans-urged-to-be-vigilant-to-these-threats-during-the-pandemic-and-its-aftermath

IRS YouTube Video: Dirty Dozen — English  | Spanish  | ASL IR-2020-160, July 16, 2020 WASHINGTON — The Internal Revenue Service today announced its annual "Dirty Dozen" list of tax scams with a special emphasis on aggressive and evolving schemes related to coronavirus tax relief, including Economic Impact Payments. This year, the Dirty Dozen focuses on scams that target taxpayers. The criminals behind these bogus schemes view everyone as potentially easy prey. The IRS urges everyone to be on guard all the time and look out for others in their lives. "Tax scams tend to rise during tax season or during times of crisis, and scam artists are using pandemic to try stealing money and information from honest taxpayers," said IRS Commissioner Chuck Rettig. "The IRS provides the Dirty Dozen list to help raise awareness about common scams that fraudsters use to target people. We urge people to watch out for these scams. The IRS is doing its part to protect Americans. We will relentlessly pursue criminals trying to steal your money or sensitive personal financial information." Taxpayers are encouraged to review the list in a special section on IRS.gov and be on the lookout for these scams throughout the year. Taxpayers should also remember that they are legally responsible for what is on their tax return even if it is prepared by someone else. Consumers can help protect themselves by choosing a reputable tax preparer. The IRS urges taxpayers to refrain from engaging potential scammers online or on the phone. The IRS plans to unveil a similar list of enforcement and compliance priorities this year as well. An upcoming series of press releases will emphasize the illegal schemes and techniques businesses and individuals use to avoid paying their lawful tax liability. Topics will include such scams as abusive micro captives and fraudulent conservation easements. Here are this year's "Dirty Dozen" scams: Phishing: Taxpayers should be alert to potential fake emails or websites looking to steal personal information. The IRS will never initiate contact with taxpayers via email about a tax bill, refund or Economic Impact Payments. Don't click on links claiming to be from the IRS. Be wary of emails and websites − they may be nothing more than scams to steal personal information. IRS Criminal Investigation has seen a tremendous increase in phishing schemes utilizing emails, letters, texts and links. These phishing schemes are using keywords such as "coronavirus," "COVID-19" and "Stimulus" in various ways. These schemes are blasted to large numbers of people in an effort to get personal identifying information or financial account information, including account numbers and passwords. Most of these new schemes are actively playing on the fear and unknown of the virus and the stimulus payments. (For more see IR-2020-115, IRS warns against COVID-19 fraud; other financial schemes.) Fake Charities: Criminals frequently exploit natural disasters and other situations such as the current COVID-19 pandemic by setting up fake charities to steal from well-intentioned people trying to help in times of need. Fake charity scams generally rise during times like these. Fraudulent schemes normally start with unsolicited contact by telephone, text, social media, e-mail or in-person using a variety of tactics. Bogus websites use names similar to legitimate charities to trick people to send money or provide personal financial information. They may even claim to be working for or on behalf of the IRS to help victims file casualty loss claims and get tax refunds. Taxpayers should be particularly wary of charities with names like nationally known organizations. Legitimate charities will provide their Employer Identification Number (EIN), if requested, which can be used to verify their legitimacy. Taxpayers can find legitimate and qualified charities with the search tool on IRS.gov. Threatening Impersonator Phone Calls: IRS impersonation scams come in many forms. A common one remains bogus threatening phone calls from a criminal claiming to be with the IRS. The scammer attempts to instill fear and urgency in the potential victim. In fact, the IRS will never threaten a taxpayer or surprise him or her with a demand for immediate payment. Phone scams or "vishing" (voice phishing) pose a major threat. Scam phone calls, including those threatening arrest, deportation or license revocation if the victim doesn't pay a bogus tax bill, are reported year-round. These calls often take the form of a "robocall" (a text-to-speech recorded message with instructions for returning the call). The IRS will never demand immediate payment, threaten, ask for financial information over the phone, or call about an unexpected refund or Economic Impact Payment. Taxpayers should contact the real IRS if they worry about having a tax problem. Social Media Scams: Taxpayers need to protect themselves against social media scams, which frequently use events like COVID-19 to try tricking people. Social media enables anyone to share information with anyone else on the Internet. Scammers use that information as ammunition for a wide variety of scams. These include emails where scammers impersonate someone's family, friends or co-workers. Social media scams have also led to tax-related identity theft. The basic element of social media scams is convincing a potential victim that he or she is dealing with a person close to them that they trust via email, text or social media messaging. Using personal information, a scammer may email a potential victim and include a link to something of interest to the recipient which contains malware intended to commit more crimes. Scammers also infiltrate their victim's emails and cell phones to go after their friends and family with fake emails that appear to be real and text messages soliciting, for example, small donations to fake charities that are appealing to the victims. EIP or Refund Theft: The IRS has made great strides against refund fraud and theft in recent years, but they remain an ongoing threat. Criminals this year also turned their attention to stealing Economic Impact Payments as provided by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Much of this stems from identity theft whereby criminals file false tax returns or supply other bogus information to the IRS to divert refunds to wrong addresses or bank accounts. The IRS recently warned nursing homes and other care facilities that Economic Impact Payments generally belong to the recipients, not the organizations providing the care. This came following concerns that people and businesses may be taking advantage of vulnerable populations who received the payments. These payments do not count as a resource for determining eligibility for Medicaid and other federal programs They also do not count as income in determining eligibility for these programs. See IR-2020-121, IRS alert: Economic Impact Payments belong to recipient, not nursing homes or care facilities for more. Taxpayers can consult the Coronavirus Tax Relief page of IRS.gov for assistance in getting their EIPs. Anyone who believes they may be a victim of identity theft should consult the Taxpayer Guide to Identity Theft on IRS.gov. Senior Fraud: Senior citizens and those who care about them need to be on alert for tax scams targeting older Americans. The IRS recognizes the pervasiveness of fraud targeting older Americans along with the Department of Justice and FBI, the Federal Trade Commission, the Consumer Financial Protection Bureau (CFPB), among others. Seniors are more likely to be targeted and victimized by scammers than other segments of society. Financial abuse of seniors is a problem among personal and professional relationships. Anecdotal evidence across professional services indicates that elder fraud goes down substantially when the service provider knows a trusted friend or family member is taking an interest in the senior's affairs. Older Americans are becoming more comfortable with evolving technologies, such as social media. Unfortunately, that gives scammers another means of taking advantage. Phishing scams linked to Covid-19 have been a major threat this filing season. Seniors need to be alert for a continuing surge of fake emails, text messages, websites and social media attempts to steal personal information. Scams targeting non-English speakers: IRS impersonators and other scammers also target groups with limited English proficiency. These scams are often threatening in nature. Some scams also target those potentially receiving an Economic Impact Payment and request personal or financial information from the taxpayer. Phone scams pose a major threat to people with limited access to information, including individuals not entirely comfortable with the English language. These calls frequently take the form of a "robocall" (a text-to-speech recorded message with instructions for returning the call), but in some cases may be made by a real person. These con artists may have some of the taxpayer's information, including their address, the last four digits of their Social Security number or other personal details – making the phone calls seem more legitimate. A common one remains the IRS impersonation scam where a taxpayer receives a telephone call threatening jail time, deportation or revocation of a driver's license from someone claiming to be with the IRS. Taxpayers who are recent immigrants often are the most vulnerable and should ignore these threats and not engage the scammers. Unscrupulous Return Preparers: Selecting the right return preparer is important. They are entrusted with a taxpayer's sensitive personal data. Most tax professionals provide honest, high-quality service, but dishonest preparers pop up every filing season committing fraud, harming innocent taxpayers or talking taxpayers into doing illegal things they regret later. Taxpayers should avoid so-called "ghost" preparers who expose their clients to potentially serious filing mistakes as well as possible tax fraud and risk of losing their refunds. With many tax professionals impacted by COVID-19 and their offices potentially closed, taxpayers should take particular care in selecting a credible tax preparer. Ghost preparers don't sign the tax returns they prepare. They may print the tax return and tell the taxpayer to sign and mail it to the IRS. For e-filed returns, the ghost preparer will prepare but not digitally sign as the paid preparer. By law, anyone who is paid to prepare or assists in preparing federal tax returns must have a Preparer Tax Identification Number (PTIN). Paid preparers must sign and include their PTIN on returns. Unscrupulous preparers may also target those without a filing requirement and may or may not be due a refund. They promise inflated refunds by claiming fake tax credits, including education credits, the Earned Income Tax Credit (EITC) and others. Taxpayers should avoid preparers who ask them to sign a blank return, promise a big refund before looking at the taxpayer's records or charge fees based on a percentage of the refund. Taxpayers are ultimately responsible for the accuracy of their tax return, regardless of who prepares it. Taxpayers can go to a special page on IRS.gov for tips on choosing a preparer. Offer in Compromise Mills: Taxpayers need to wary of misleading tax debt resolution companies that can exaggerate chances to settle tax debts for "pennies on the dollar" through an Offer in Compromise (OIC). These offers are available for taxpayers who meet very specific criteria under law to qualify for reducing their tax bill. But unscrupulous companies oversell the program to unqualified candidates so they can collect a hefty fee from taxpayers already struggling with debt. These scams are commonly called OIC "mills," which cast a wide net for taxpayers, charge them pricey fees and churn out applications for a program they're unlikely to qualify for. Although the OIC program helps thousands of taxpayers each year reduce their tax debt, not everyone qualifies for an OIC. In Fiscal Year 2019, there were 54,000 OICs submitted to the IRS. The agency accepted 18,000 of them. Individual taxpayers can use the free online Offer in Compromise Pre-Qualifier tool to see if they qualify. The simple tool allows taxpayers to confirm eligibility and provides an estimated offer amount. Taxpayers can apply for an OIC without third-party representation; but the IRS reminds taxpayers that if they need help, they should be cautious about whom they hire. Fake Payments with Repayment Demands: Criminals are always finding new ways to trick taxpayers into believing their scam including putting a bogus refund into the taxpayer's actual bank account. Here's how the scam works: A con artist steals or obtains a taxpayer's personal data including Social Security number or Individual Taxpayer Identification Number (ITIN) and bank account information. The scammer files a bogus tax return and has the refund deposited into the taxpayer's checking or savings account. Once the direct deposit hits the taxpayer's bank account, the fraudster places a call to them, posing as an IRS employee. The taxpayer is told that there's been an error and that the IRS needs the money returned immediately or penalties and interest will result. The taxpayer is told to buy specific gift cards for the amount of the refund. The IRS will never demand payment by a specific method. There are many payment options available to taxpayers and there's also a process through which taxpayers have the right to question the amount of tax we say they owe. Anytime a taxpayer receives an unexpected refund and a call from us out of the blue demanding a refund repayment, they should reach out to their banking institution and to the IRS. Payroll and HR Scams: Tax professionals, employers and taxpayers need to be on guard against phishing designed to steal Form W-2s and other tax information. These are Business Email Compromise (BEC) or Business Email Spoofing (BES). This is particularly true with many businesses closed and their employees working from home due to COVID-19. Currently, two of the most common types of these scams are the gift card scam and the direct deposit scam. In the gift card scam, a compromised email account is often used to send a request to purchase gift cards in various denominations. In the direct deposit scheme, the fraudster may have access to the victim's email account (also known as an email account compromise or "EAC"). They may also impersonate the potential victim to have the organization change the employee's direct deposit information to reroute their deposit to an account the fraudster controls. BEC/BES scams have used a variety of ploys to include requests for wire transfers, payment of fake invoices as well as others. In recent years, the IRS has observed variations of these scams where fake IRS documents are used in to lend legitimacy to the bogus request. For example, a fraudster may attempt a fake invoice scheme and use what appears to be a legitimate IRS document to help convince the victim. The Direct Deposit and other BEC/BES variations should be forwarded to the Federal Bureau of Investigation Internet Crime Complaint Center (IC3) where a complaint can be filed. The IRS requests that Form W-2 scams be reported to: phishing@irs.gov (Subject: W-2 Scam). Ransomware: This is a growing cybercrime. Ransomware is malware targeting human and technical weaknesses to infect a potential victim's computer, network or server. Malware is a form of invasive software that is often frequently inadvertently downloaded by the user. Once downloaded, it tracks keystrokes and other computer activity. Once infected, ransomware looks for and locks critical or sensitive data with its own encryption. In some cases, entire computer networks can be adversely impacted. Victims generally aren't aware of the attack until they try to access their data, or they receive a ransom request in the form of a pop-up window. These criminals don't want to be traced so they frequently use anonymous messaging platforms and demand payment in virtual currency such as Bitcoin. Cybercriminals might use a phishing email to trick a potential victim into opening a link or attachment containing the ransomware. These may include email solicitations to support a fake COVID-19 charity. Cybercriminals also look for system vulnerabilities where human error is not needed to deliver their malware. The IRS and its Security Summit partners have advised tax professionals and taxpayers to use the free, multi-factor authentication feature being offered on tax preparation software products. Use of the multi-factor authentication feature is a free and easy way to protect clients and practitioners' offices from data thefts. Tax software providers also offer free multi-factor authentication protections on their Do-It-Yourself products for taxpayers.

https://www.irs.gov/newsroom/irs-announces-2021-ptin-fees-for-tax-return-preparers

IR-2020-159, July 15, 2020 WASHINGTON — The Internal Revenue Service announced today the annual fee for 2021 that tax return preparers must pay to apply for or renew their Preparer Tax Identification Number (PTIN). In final regulations issued today, the IRS set a $21 fee per PTIN application or renewal (plus a $14.95 fee payable to a contractor). Anyone who prepares or substantially helps prepare any federal tax return or claim for refund for compensation must have a valid PTIN from the IRS. The PTIN must be used as the identifying number on returns prepared. Failure to have and use a valid PTIN may result in penalties. The IRS estimates that more than 800,000 tax return preparers will apply for or renew a PTIN this year. The annual renewal of PTINs ensures the IRS has up-to-date identifying information about each return preparer, which is essential for timely communication of important information. The program helps protect both return preparers and taxpayers and prevent the unauthorized use of PTINs. The IRS is required PDF to conduct a biennial review of the PTIN user fee. The agency determined that the full cost to administer the PTIN program going forward is $21 per application or renewal. This amount includes costs relating to PTIN misuse and maintaining the integrity of PTINs. The third-party contractor fee, $14.95, pays for several functions including processing applications, renewals and operating a call center. PTINs expire on December 31 of the year for which they are issued. PTINs generally can be renewed beginning in mid-October and are valid for the following calendar year. A tax return preparer can renew online at www.irs.gov/ptin by logging into the preparer's PTIN account or by submitting a paper Form W-12 with the "Renewal" box checked.

https://www.irs.gov/newsroom/irs-is-sending-letters-to-those-experiencing-a-delay-with-advance-payment-of-employer-credits

IR-2020-158, July 15, 2020 WASHINGTON — The Internal Revenue Service has started sending letters to taxpayers who have experienced a delay in the processing of their Form 7200, Advance Payment of Employer Credits Due To COVID-19PDF. A taxpayer will receive letter 6312 if the IRS either rejected Form 7200 or made a change to the requested amount of advance payment due to a computation error. The letter will explain the reason for the rejection or, if the amount is adjusted, the new payment amount will be listed on the letter. A taxpayer will receive letter 6313 if the IRS needs written verification from a taxpayer that the address listed on their Form 7200 is the current mailing address for their business. The IRS will not process Form 7200 or change the last known address until the taxpayer provides it. For more information on the employer credits, see Employer Tax Credits.

https://www.irs.gov/newsroom/wheres-my-refund-tool-on-irsgov-takes-guesswork-out-of-when-to-expect-refunds

IR-2020-157, July 15, 2020 WASHINGTON — The IRS reminds taxpayers that one of the best ways to check on their refund is the Where's My Refund? tool on the IRS website and the IRS2Go app. Updated once a day, usually overnight, this useful tool gives taxpayers a projected refund issuance date as soon as it is approved. The IRS issues nine out of 10 refunds in less than 21 days, and the fastest way to get a refund is to use IRS e-file and direct deposit. Taxpayers should also know they can have their refunds divided into up to three separate accounts. Due to the COVID-19 pandemic, IRS live phone assistance is extremely limited. People are encouraged to first check the Where's My Refund? tool on the IRS website and the IRS2Go app. Taxpayers can also review the IRS Services GuidePDF which links to additional IRS online services. Please note: Ordering a tax transcript will not speed delivery of tax refunds nor does the posting of a tax transcript to a taxpayer's account determine the timing of a refund delivery. Calls to request transcripts for this purpose are unnecessary. Transcripts are available online and by mail at Get Transcript. A few necessary items To use the Where's My Refund" tool, taxpayers will need to enter their Social Security number, tax filing status (single, married, head of household) and exact amount of the tax refund claimed on the return. Taxpayers who file electronically can check Where's My Refund? within 24 hours after they receive their e-file acceptance notification. The tool can tell taxpayers when their tax return has been received, when the refund is approved and the date the refund is to be issued. Some refunds may take longer While the IRS continues to process electronic and paper tax returns, issue refunds, and accept payments, there are delays in processing paper tax returns due to limited staffing. If a taxpayer filed a paper tax return, the return will be processed in the order in which it was received. Do not file a second tax return or call the IRS. Many different factors can affect the timing of a refund. In some cases, a tax return may require additional review. It is also important to consider the time it takes for a financial institution to post the refund to an account or for a refund check to be delivered by mail. Taxpayers who owe The IRS encourages taxpayers who owe to do a Paycheck Checkup every year to ensure enough tax is withheld from their pay to avoid an unexpected tax bill.

https://www.irs.gov/newsroom/irs-provides-additional-relief-for-tax-exempt-hospitals-deadline-for-completing-certain-needs-assessment-requirements-moved-to-dec-31

IR-2020-156, July 14, 2020 WASHINGTON — Because of the burdens the COVID-19 pandemic has placed on hospitals, the Internal Revenue Service today provided additional relief to hospital organizations that must meet the Community Health Needs Assessments (CHNA) requirements. Notice 2020-56PDF extends the deadline for conducting a CHNA and adopting an implementation strategy to meet the community health needs identified through the CHNA to December 31, 2020. Tax-exempt hospital organizations filing Forms 990 must indicate on Schedule H if they have conducted a CHNA in the current taxable year or in either of the two immediately preceding taxable years and if they have adopted an implementation strategy to meet the significant health needs identified through the most recently completed CHNA. Since these requirements may affect the hospital's tax-exempt status and because the law imposes a $50,000 tax on a hospital organization for each hospital facility that fails to meet either or both of these requirements, the extension provided in the notice provides significant relief. Under Notice 2020-56, the time for hospitals to comply with any CHNA requirements due to be performed on or after April 1, 2020, and before December 31, 2020, is extended to December 31, 2020. Previously, the IRS issued guidancePDF extending the due date to July 15, 2020; today's guidance further extends that due date. Hospitals using the relief in today's notice that file Form 990 prior to December 31, 2020, should state in the narrative of Part V.C. of Schedule H (Form 990) that they are eligible for and are relying on the relief provided in the notice, and should not be treated as failing to meet the requirements of section 501(r)(3) prior to December 31, 2020. Additional tax relief related to the COVID-19 pandemic can be found on IRS.gov.

https://www.irs.gov/newsroom/treasury-and-irs-release-draft-partnership-form-to-provide-greater-clarity-on-international-tax-reporting

IR-2020-155, July 14, 2020 WASHINGTON — The Treasury Department and the IRS today released a proposed redesigned partnership form for tax year 2021 (filing season 2022). The proposed form is designed to provide greater clarity for partners on how to compute their U.S. income tax liability with respect to items of international tax relevance, including claiming deductions and credits. The redesigned form and instructions provide guidance to partnerships on how to report international tax information to their partners in a standardized format. This proposed form would apply to a partnership required to file Form 1065 only if the partnership has items of international tax relevance (generally foreign activities or foreign partners). The proposed changes would not affect domestic partnerships with no international tax items to report. This early release is intended to afford time for stakeholder input and engagement. Treasury and IRS invite comments from affected stakeholders through September 14, 2020. Written comments should be sent to the following email address: lbi.passthrough.international.form.changes@irs.gov with the subject line: "International Form Changes." The Treasury Department and the IRS will be actively engaged with stakeholders to solicit input on these proposed changes before the forms are finalized later in 2020. Currently, partners are required to report international tax information on their tax returns on several tax forms and schedules. Partners generally obtain the information required to be reported from their partnerships, usually through narrative statements attached to K-1s. Those statements are compiled in a variety of formats and may be difficult for partners to translate onto their own returns. The proposed changes intend to ease this burden through a standard format that offers greater clarity to both partnerships and their partners. The standard format of the new partnership schedules is designed to better align the information that partnerships provide on the schedules with the tax forms used by partners, allowing partners to more easily prepare their tax returns and the IRS to more efficiently verify taxpayer compliance. It is intended that all the information to be reported on the new schedules is already necessary for the partnership to provide to partners or is available to the partnership. The Treasury Department and the IRS are releasing the draft new Schedule K-2 (Form 1065), Partners' Distributive Share Items - International and Schedule K-3 (Form 1065), Partner's – Share of Income, Deductions, Credits, etc. – International, both for tax year 2021 (filing season 2022), and the draft instructions, to allow partnerships and other stakeholders time to consider the proposed changes and to provide comments that can be taken into account in finalizing the schedules and instructions. The proposed parts included in new Schedule K-2 (Form 1065) replace portions of existing Form 1065, Schedule K, lines 16(a) through 16(r). The proposed schedule provides for international tax information to be reported in a standardized manner generally corresponding to the tax forms listed above. The proposed parts included in new Schedule K-3 (Form 1065) replaces portions of Schedule K-1, Part III, Boxes 16 and 20, and provides information to the partner generally in the format of the following forms that might be completed by the partner: Form 1040, U.S. Individual Income Tax Return; Form 1040-NR, U.S. Nonresident Alien Income Tax Return; Form 1116, Foreign Tax Credit (Individual, Estate, or Trust); Form 1118, Foreign Tax Credit – Corporations; Form 1120, U.S. Corporation Income Tax Return; Form 1120-F, U.S. Income Tax Return of a Foreign Corporation; Form 4797, Sales of Business Property; Form 8949, Sales and Other Dispositions of Capital Assets; Form 8991, Tax on Base Erosion Payments of Taxpayers with Substantial Gross Receipts; Form 8992, U.S. Shareholder Calculation of Global Intangible Low-Taxed Income (GILTI); and Form 8993, Section 250 Deduction for Foreign Derived Intangible Income (FDII) and Global Intangible Low-Taxed Income (GILTI). The Treasury Department and the IRS plan similar revisions, as applicable, to Form 1120-S (U.S. Income Tax Return for an S Corporation) and Form 8865 (Return of U.S. Persons with Respect to Certain Foreign Partnerships). The Treasury Department and the IRS welcome comments on similar changes to be made to Forms 1120-S and 8865 for the 2021 tax year.

https://www.irs.gov/newsroom/irs-reminder-file-and-pay-2019-business-taxes-by-july-15-2020-estimated-tax-also-due

IR-2020-154, July 14, 2020 WASHINGTON — The Internal Revenue Service today reminded business taxpayers that their 2019 tax returns and tax payments, as well as their first two 2020 estimated tax payments, are due on Wednesday, July 15. The July 15 due date generally applies to any tax return or tax payment deadline that was postponed due to COVID-19. In April, the IRS said that this postponement applied to all taxpayers that had a filing or payment deadline falling on or after April 1, 2020, and before July 15, 2020. No late-filing penalty, late-payment penalty or interest will be due for payments prior to July 15. Corporations, trusts and estates, as well as individuals and other non-corporate tax filers qualify for the extra time. A complete list of qualifying filing and payment deadlines are available at IRS.gov/coronavirus. Businesses that need a tax-filing extension beyond the July 15 deadline can get one by filing Form 7004. An extension to file is not an extension to pay. To avoid interest charges and any possible late-payment penalties, be sure to estimate any tax liability and pay it by the July 15 deadline. Individuals who file Form 1040, including sole proprietors, farmers and landlords, can get an extension by filing Form 4868. The fastest and easiest way to meet the July 15 deadline is to file returns and pay any taxes due electronically. For more information on e-file and e-payment options, visit IRS.gov/efile.

https://www.irs.gov/newsroom/irs-reminder-taxpayers-can-get-an-extension-to-oct-15-to-file-taxes

IR-2020-153, July 14, 2020 WASHINGTON – The Internal Revenue Service today reminds taxpayers that they have until the postponed due date of July 15, 2020, to file an extension for their 2019 federal tax return. The extension gives taxpayers until Oct. 15 to file, but taxes owed are due by July 15. The July 15 due date generally applies to all taxpayers who have an income tax filing or payment deadline falling on or after April 1, 2020, and before July 15, 2020. Taxpayers and tax professionals should continue to use electronic options. The IRS encourages taxpayers to file electronically. Doing so, whether through e-file or IRS Free File, reduces tax return errors, as the tax software does the calculations, flags common errors and prompts taxpayers for missing information. Free File Fillable Forms means there is a free option for everyone. Here's how to get an extension of time to file Individual taxpayers who need additional time to file beyond the July 15 deadline can request a filing extension to Oct. 15 in one of two ways: Filing Form 4868 through their tax professional, tax software or using Free File on IRS.gov. Submitting an electronic payment with Direct Pay, Electronic Federal Tax Payment System or by debit, credit card or digital wallet options and selecting Form 4868 or extension as the payment type. The automatic extension of time to file will process when taxpayers pay all or part of their taxes, electronically, by the July 15 due date. Businesses that need additional time to file income tax returns must file Form 7004, Application for Automatic Extension of Time To File Certain Business Income Tax, Information, and Other Returns. IRS.gov assistance Taxpayers may find answers to many of their questions using the Interactive Tax Assistant (ITA), a tax law resource that works using a series of questions and responses. IRS.gov has answers for Frequently Asked Questions. The IRS website has tax information in: Spanish (español); Chinese (中文); Korean (한국어); Russian (Pусский); Vietnamese (Tyng Việt); and Haitian Creole (Kreyòl ayisyen). Go to IRS.gov/payments for electronic payment options.

https://www.irs.gov/newsroom/tax-court-strikes-down-four-more-abusive-syndicated-conservation-easement-transactions-irs-calls-on-taxpayers-to-accept-settlement-offers-in-syndicated-conservation-easement-cases

IR-2020-152, July 13, 2020 WASHINGTON — On July 9, the U.S. Tax Court struck down four more abusive syndicated conservation easement transactions. The Internal Revenue Service calls on any taxpayer involved in syndicated conservation easement transactions who receives a settlement offer from the agency to accept it soon. These time-limited settlement offers, announced June 25, are only being made to certain taxpayers with pending docketed Tax Court cases involving this type of abusive transaction. These and other recent Tax Court decisions support the abusive nature of the underlying syndicated conservation easement deduction. The four most recent U.S. Tax Court decisions disallowed conservation easement deductions totaling nearly $21 million. "The IRS will continue to actively identify, audit and litigate these syndicated conservation easement deals as part of its vigorous and relentless effort to combat abusive transactions," said IRS Commissioner Chuck Rettig. "These abusive transactions undermine the public's trust in private land conservation and defraud the government of revenue. We strongly recommend that participants seek the advice of competent, independent advisors. Ending these abusive schemes remains a top priority for the IRS." The IRS recognizes the important role of legitimate conservation easement deductions in incentivizing land preservation for future generations. However, abusive syndicated conservation easement transactions have been of concern to the IRS for several years. The IRS is aware that some promoters of these abusive transactions have downplayed the significance of the string of recent court decisions holding in the government's favor, arguing that their cases are somehow different or that those decisions might be reversed on appeal. These promoters ignore common sense and argue that the real dispute is about value, neglecting to explain how the reporting of short-term appreciation, often exceeding many multiples of reality, could possibly withstand judicial scrutiny. "Taxpayers should ignore this nonsense, take an objective look at their cases, and cut their losses," said IRS Chief Counsel Mike Desmond. "Abusive transactions, like settlement offers, do not get better with time, and this is a good opportunity to get out."  In listed syndicated conservation easement structures, promoters syndicate ownership interests in real property through partnerships, using promotional materials to suggest that prospective investors may be entitled to a share of a conservation easement contribution deduction that equals or exceeds two and one-half times the investment amount. The promoters obtain an appraisal that greatly inflates the value of the conservation easement based on a fictional and unrealistic highest and best use of the property before it was encumbered with the easement. After the investors invest in the partnership, the partnership donates a conservation easement to a land trust. Investors in the partnership then claim a deduction based on an inflated value. The investors typically claim charitable contribution deductions that grossly multiply their actual investment in the transaction and defy common sense.

https://www.irs.gov/newsroom/j5-reflects-on-two-years-pursuing-global-tax-cheats

IR-2020-151, July 13, 2020 WASHINGTON — Leaders from five international tax organizations are marking the two-year anniversary of the formation of the Joint Chiefs of Global Tax Enforcement (J5) this week. The J5 includes the Australian Taxation Office (ATO, the Canadian Revenue Agency (CRA), the Dutch Fiscal Information and Investigation Service (FIOD), Her Majesty's Revenue and Customs (HMRC) from the UK and the Internal Revenue Service Criminal Investigation Division (IRS-CI) from the US. Taking advantage of each country's strengths, the J5's initial focus was on enablers of tax crime, virtual currency and platforms that enable each country to share information in a more efficient manner. Within the framework of each country's laws, J5 countries shared information and were able to open new cases, more completely develop existing cases, and find efficiencies to reduce the time it takes to work cases. Operational results have always been the goal of the organization and they have started to materialize. "While operational results matter, I've been most excited at the other benefits that this group's existence has provided," said Don Fort, Chief, IRS Criminal Investigation. "In speaking with law enforcement partners domestically and abroad as well as stakeholders in various public and private tax organizations, there is real support for this organization and tangible results we have all seen due to the cooperation and global leadership of the J5." During the two years since the J5's inception, hundreds of data exchanges between J5 partner agencies have occurred with more data being exchanged in the past year than the previous 10 years combined. Each J5 country brings different strengths and skillsets to the J5 and leveraging those skills and capabilities enhance the effectiveness and success of the J5. Experts from the J5 countries have seen indications that tax offenders are embracing ever more complex methods to conceal their wrongdoings, creating multiple mechanisms and structures that are split across jurisdictions, taking advantage of those areas that offer secrecy and regulatory benefits. With this information, the J5 finds itself continuously adapting to the latest criminal methods and changing behaviors to prioritize the collective operational activity to tackle this dynamic threat picture. Since the inception of the organization, two J5 countries have hosted events known as "Challenges" aimed at developing operational collaboration. FIOD hosted the first J5 "Challenge" in Utrecht in 2018 and brought together leading data scientists, technology experts and investigators from all J5 countries in a coordinated push to track down those who make a living out of facilitating and enabling international tax crime. The event identified, developed, and tested tools, platforms, techniques, and methods that contribute to the mission of the J5 focusing on identifying professional enablers facilitating offshore tax fraud. The following year, the U.S. hosted a second "Challenge" in Los Angeles and brought together investigators, cryptocurrency experts and data scientists in a coordinated push to track down individuals perpetrating tax crimes around the world. Last week, a Romanian man was arrested in Germany and admitted to conspiring to engage in wire fraud and offering and selling unregistered securities in connection with his role in the BitClub Network, a cryptocurrency mining scheme worth at least $722 million. This plea was the first for a case under the J5 umbrella and stemmed from collaboration with the Netherlands during the "Challenge" in Los Angeles in 2019. "The value of the Challenges cannot be overstated," said Fort. "When you take some of the smartest people from each organization and put them in a room for a few days, the results are truly impressive. Each country found investigative leads and was able to further cases utilizing tools and techniques created by each country's experts specifically for the Challenge. I see us doing more of these events in the future." Last year, the United States and the World Bank hosted cyber training in Washington, DC bringing together more than 120 international and domestic law enforcement partners from approximately 20 countries to address emerging areas associated with cybercrime, virtual currency, blockchain and the dark web. Additionally, to ensure J5 countries were using all law enforcement and legal tools available during their collaborative work, trainings were held in Sydney and the Netherlands on international elements of the UK corporate criminal offense legislation and prosecution opportunities to lawyers and public prosecutors. After two years of collaboration, data sharing and accelerated casework, the J5 began seeing operational results in early 2020. J5 countries participated in a globally coordinated day of action to put a stop to the suspected facilitation of offshore tax evasion. The action was part of a series of investigations in multiple countries into an international financial institution located in Central America, whose products and services are believed to be facilitating money laundering and tax evasion for customers across the globe. Evidence, intelligence and information collection activities such as search warrants, interviews and subpoenas were undertaken in each country and significant information was obtained and shared as a result. That investigation is ongoing. "To see each country participate in a coordinated enforcement action all over the world at the same time with the same goal in mind was a real watershed moment for this organization," said Fort. "And that was just the beginning. With dozens of cases in our collective pipelines, I'm excited to see what the next year brings in terms of operational results." In addition to the group's work with enablers and virtual currency, the J5 also focused on platforms that enable each country to share information in a more organized manner. FCInet is one such platform that each country has invested in to further that goal. FCInet is a decentralized virtual computer network that enables agencies to compare, analyze and exchange data anonymously. It helps users to obtain the right information in real-time and enables agencies from different jurisdictions to work together while respecting each other's local autonomy. Organizations can jointly connect information, without needing to surrender data or control to a central database. FCInet doesn't collect data, rather it connects data. The J5 was formed in 2018 after a call to arms from the OECD Taskforce on Tax Crime and has been working together to gather information, share intelligence and conduct coordinated operations, making significant progress in each country's fight against transnational tax crime. For more information about J5, please visit www.irs.gov/j5.

https://www.irs.gov/newsroom/irs-gives-tips-on-filing-paying-electronically-and-checking-refunds-online-2019-tax-returns-and-payments-due-july-15

IR-2020-150, July 13, 2020 WASHINGTON — The Internal Revenue Service today reminded taxpayers with a filing requirement to file an accurate tax return on time even if a balance due can't be paid in full. The deadline to submit 2019 tax returns is July 15, 2020, for most people. Members of the military serving overseas may have more time. File electronically to avoid most common errors Filing electronically and choosing direct deposit remains the fastest and safest way to file an accurate income tax return and receive a refund. Filing electronically reduces tax return errors as the tax software does the calculations, flags common errors and prompts taxpayers for missing information. An inaccurate tax return can delay a refund. Some common errors to avoid include: Missing or inaccurate Social Security numbers. Enter each name and SSN exactly as printed on the Social Security card. Incorrect filing status. The Interactive Tax Assistant on IRS.gov can help taxpayers choose the correct status. Tax software also helps prevent these mistakes. Math errors. Tax preparation software does all the math automatically. Math errors are common on paper returns. Figuring credits or deductions incorrectly. Taxpayers should follow the instructions carefully, and double check the information they enter when filing electronically. The IRS Interactive Tax Assistant can help determine if a taxpayer is eligible for certain tax credits. Unsigned returns. Both spouses must sign if filing jointly. Taxpayers can avoid this error by filing their return electronically and digitally signing it. Exceptions may apply for military families if a spouse is serving overseas. Filing with an expired individual taxpayer identification number. In most cases, tax software helps to reduce or eliminate these. Find complete details on all the benefits of filing electronically, including IRS Free File, commercial tax prep software or an authorized e-file provider from the File page on IRS.gov. Checking on refunds The IRS is processing electronic and paper tax returns and issuing refunds. The IRS normally issues most refunds in less than 21 days. Taxpayers who mailed a tax return will experience a longer wait time. There is no need to mail a second tax return or call the IRS. Where's My Refund? on IRS.gov is the most convenient way to check the status of a refund. It has a tracker that displays progress through three phases: (1) Return Received; (2) Refund Approved; and (3) Refund Sent. All that is needed to use Where's My Refund? is the taxpayer's Social Security number, tax filing status (such as single, married, head of household) and exact amount of the tax refund claimed on the 2019 tax return. It is updated no more than once every 24 hours, usually overnight, so there's no need to check the status more often. Taxpayers should file now, schedule full or partial tax payments up to the July 15 due date Taxpayers can pay online, by phone or with their mobile device and the IRS2Go app. When paying federal taxes electronically taxpayers should remember: Electronic payment options are the optimal way to make a tax payment. They can pay when they file electronically using tax software online. If using a tax preparer, taxpayers should ask the preparer to make the tax payment through an electronic funds withdrawal from a bank account. IRS Direct Pay allows taxpayers to pay online directly from a checking or savings account for free. Taxpayers can choose to pay with a credit card, debit card or digital wallet option through a payment processor. The processor may charge a fee. No fees go to the IRS. The IRS2Go app provides the mobile-friendly payment options, including Direct Pay and payment processor payments on mobile devices. Taxpayers may also enroll in the Electronic Federal Tax Payment System (EFTPS) and have a choice of paying online or by phone by using the EFTPS Voice Response System. Can't pay a tax bill? Everyone should file their 2019 tax return by the July 15 tax filing deadline regardless of whether or not they can pay in full. Taxpayers who owe and can't pay all taxes due have options including: Online Payment Agreement — Most individual taxpayers and many business taxpayers may qualify to use Online Payment Agreement to set up a payment plan. Taxpayers can setup a plan on IRS.gov/paymentplan in a matter of minutes. Setup fees may apply for some types of plans. Delaying Collection — If the IRS determines a taxpayer is unable to pay, it may delay collection until the taxpayer's financial condition improves. In light of COVID-19, IRS postponed many compliance efforts until July 15 or later under the People First Initiative. Offer in Compromise (OIC) — Taxpayers who qualify enter into an agreement with the IRS that settles their tax liability for less than the full amount owed. Find more information on when, how and where to file see Tax Information for Individuals. Need an extension of time to file a 2019 tax return? Those who need more time to prepare their 2019 federal tax return can apply for an extension of time to file. An extension of time to file does not grant an extension of time to pay taxes owed. File an extension request, estimate and pay any owed taxes by the July 15 deadline to avoid possible penalties. Individual tax filers, regardless of income, can use Free File to electronically request an automatic tax-filing extension. Filing this form gives the taxpayer until October 15 to file a return. To get the extension, the taxpayer must estimate their tax liability on this form and pay any amount due Taxpayers can also get an extension by paying all or part of their estimated income tax due and indicate that the payment is for an extension using Direct Pay, the Electronic Federal Tax Payment System (EFTPS), or a credit or debit card. This way they won't have to file a separate extension form and will receive a confirmation number for their records. Check withholding The IRS encourages taxpayers to do a Paycheck Checkup as soon as possible to avoid having too much or too little tax withheld this year. Too much normally results in a refund while too little lends itself to taxes owed next year. Taxpayers should check their withholding each year and when life changes occur, such as marriage, childbirth, adoption or buying a home. The IRS Tax Withholding Estimator is an excellent tool to help people plan and make any needed tax withholding adjustments. Taxpayers can find answers to questions, forms and instructions and easy-to-use tools online at IRS.gov. They can use these resources to get help when it's needed at home, at work or on the go. More resources: Interactive Tax Assistant IRS Podcast: Owe Taxes But Can't Pay?MP3    

https://www.irs.gov/newsroom/irs-says-a-paycheck-checkup-helps-avoid-tax-surprises

IR-2020-149, July 10, 2020 WASHINGTON — The Internal Revenue Service is reminding taxpayers that using the IRS Tax Withholding Estimator to do a Paycheck Checkup can help them have the right amount of tax withheld and avoid surprises when filing next year. Because income taxes are pay-as-you-go, taxpayers are required by law to pay most of their tax as income is received. There are two ways to do this: Through withholding from paychecks, pension payments, Social Security benefits or certain other government payments. Making quarterly estimated tax payments throughout the year for income not subject to withholding. Income tax withholding is generally based on the worker's expected filing status and standard deduction. The Tax Withholding Estimator is a tool on IRS.gov designed to help taxpayers determine how to have the right amount of tax withheld from their paychecks. It offers workers, retirees, self-employed individuals and other taxpayers a clear, step-by-step method to help determine if there is a need to adjust their withholding and submit a new Form W-4 to their employer. The latest update of the Tax Withholding Estimator provides detailed explanations to withholding recommendations on the Results Page. When to do a Paycheck Check-up Taxpayers should check their withholding annually and when life changes occur, such as marriage, childbirth, adoption and buying a home. The IRS recommends anyone who changed their withholding this year or received a tax bill after they filed their 2019 return should do a Paycheck Checkup. Estimated taxes Taxpayers with a substantial portion of their income not subject to withholding − the self-employed, investors, retirees, those with interest, dividends, capital gains, alimony and rental income − often need to pay quarterly installments of estimated tax. The IRS reminds taxpayers that various financial transactions, especially late in the year, can often have an unexpected tax impact. Examples include year-end and holiday bonuses, stock dividends, capital gain distributions from mutual funds and stocks, bonds, virtual currency, real estate or other property sold at a profit. Form 1040-ES, Estimated Tax for Individuals, includes instructions to help taxpayers figure their estimated taxes. They can also visit IRS.gov/payments to pay electronically. IRS offers two free electronic payment options where taxpayers can schedule their estimated federal tax payments up to 30 days in advance with IRS Direct Pay or up to 365 days in advance with the Electronic Federal Tax Payment System (EFTPS). For information see: Tax Withholding Estimator FAQs FAQs on the 2020 Form W-4

https://www.irs.gov/newsroom/irs-provides-last-minute-tips-for-last-minute-filers

IR-2020-148, July 10, 2020 WASHINGTON — With the July 15 tax-filing deadline − postponed from April 15 – only a few days away, the IRS is reminding taxpayers who have yet to file their tax returns that IRS.gov has tools and services to help them meet their tax obligations. IRS tax help is available 24 hours a day on IRS.gov. Whether filing a tax return, requesting an extension or making a payment, the IRS website can help last-minute filers on just about everything related to taxes. Taxpayers can also use the Interactive Tax Assistant tool to answer many tax questions they may encounter. The IRS reminds taxpayers they have a range of expert help available through a qualified tax professional, including certified public accountants, enrolled agents and attorneys. The IRS encourages people who need the help of a tax professional to visit a special page on IRS.gov. Prepare and file taxes for free Taxpayers also have several options for preparing and filing their tax returns: Taxpayers with income of $69,000 or less can use IRS Free File to find free tax preparation software. Taxpayers with incomes above $66,000 and comfortable doing their own taxes can use Free File Fillable Forms for free. Use commercial tax prep software to prepare and file taxes through IRS approved electronic channels. Use an authorized e-File provider accepted by our electronic filing program. Authorized IRS e-file providers are qualified to prepare, transmit and electronically file returns. Members of the military and qualified veterans can use MilTax, a free online tax service provided by the Department of Defense and Military OneSource. Receive refunds faster The fastest way to receive a refund is to file electronically and use direct deposit. Taxpayers who file electronically and request direct deposit for their refund need to know that: Nine out of 10 tax refunds are issued in 21 days or less. The best way to check on a refund is the Where's My Refund? tool. The Where's My Refund? tool available on IRS.gov and the IRS2Go mobile app.  Where's My Refund? is updated once a day, usually overnight.  Refunds can be divided into up to three accounts. Delays for paper tax returns The IRS is experiencing delays in processing paper tax returns due to limited staffing. This is another reason that taxpayers should choose to electronically file their taxes. Taxpayers who filed a paper tax return and expect a refund may experience a delay beyond the normal time frame of four to six weeks from the time they mailed the return. The IRS will process paper returns in the order they are received. Taxpayers should not file the same return again or call the IRS if they filed a paper tax return and are experiencing a refund delay. Get more time to file Individual taxpayers who need additional time to file beyond the July 15 deadline can request a filing extension to Oct. 15 in one of two ways: Filing Form 4868 through their tax professional, tax software or using the Free File link on IRS.gov. Submitting an electronic payment with Direct Pay, Electronic Federal Tax Payment System or by debit, credit card or digital wallet options and selecting Form 4868 or extension as the payment type. The automatic extension of time to file will process when taxpayers pay all or part of their taxes, electronically, by the July 15 due date. An extension to file is not an extension to pay. Taxes are still due by July 15. Special rules may apply for some military personnel if they are: Serving in a combat zone or a qualified hazardous duty area Living outside the United States Pay with ease Taxpayers can file now and schedule their federal tax payments up to the July 15 due date. They can pay online, by phone or with their mobile device using the IRS2Go app. When paying federal taxes electronically taxpayers should remember: Electronic payment options are the optimal way to make a tax payment. They can pay when they file electronically using tax software online. If using a tax preparer, taxpayers should ask the preparer to make the tax payment through an electronic funds withdrawal from a bank account. IRS Direct Pay allows taxpayers to pay online directly from a checking or savings account for free, and to schedule payments up to 365 days in advance. Taxpayers can choose to pay with a credit card, debit card or digital wallet option through a payment processor. The payment processor adds a fee; no fees go to the IRS. The IRS2Go app provides the mobile-friendly payment options, including Direct Pay and through payment providers. Taxpayers may also enroll in the Electronic Federal Tax Payment System and have a choice of paying online or by phone by using the EFTPS Voice Response System. Get more time to pay Qualified taxpayers can choose to pay any taxes owed over time through an installment agreement. An online payment plan can be set up in a matter of minutes. Interest and late-payment penalties continue to accrue on any unpaid taxes after July 15. Payment options include: Short-term payment plan (paying within 120 days). Long-term payment plan (paying in more than 120 days). However, a taxpayer's specific tax situation will determine which payment options are available. The IRS has more information for taxpayers who owe taxes, but cannot afford to pay the full amount. Get the full picture Taxpayers can go to IRS.gov/account to securely access information about their federal tax account. They can view the amount they owe, access their tax records online, review their payment history and view key tax return information for the most recent tax return as originally filed.

https://www.irs.gov/newsroom/irs-finalizes-guidance-on-deduction-for-foreign-derived-intangible-income-and-global-intangible-low-taxed-income

IR-2020-147, July 9, 2020 WASHINGTON — The Internal Revenue Service issued final regulations that provide guidance on deductions for foreign-derived intangible income (FDII) and global intangible low-taxed income allowed to domestic corporations under the Internal Revenue Code. These final regulations provide guidance on both the computation of the deductions available and the determination of FDII. In addition, the guidance provides rules for the computation of FDII in the consolidated return context. The guidance published today also finalizes the reporting rules requiring the filing of Form 8993, Section 250 Deduction for Foreign-Derived Intangible Income and Global Intangible Low-Taxed Income. For more information about this and other Tax Cuts and Jobs Act provisions, visit IRS.gov/taxreform.

https://www.irs.gov/newsroom/ira-contributions-made-by-july-15-count-as-2019-tax-deduction

IR-2020-146, July 9, 2020 WASHINGTON — The Internal Revenue Service today reminded people that contributions to traditional Individual Retirement Arrangements (IRAs) made by the postponed tax return due date of July 15, 2020, are deductible on a 2019 tax return. Taxpayers can file their 2019 tax return now and claim the deduction before the contribution is actually made. But the contribution must then be made by the July 15 due date of the return, not including extensions. Most taxpayers who work and are under age 70½ at the end of 2019 are eligible to start a traditional IRA or add money to an existing account. Taxpayers can contribute to a Roth IRA at any age. Starting with tax year 2020, taxpayers of any age – even those over 70½ – can start a traditional IRA. Contributions to a traditional IRA are usually tax deductible and withdrawals are generally taxable. Contributions to a Roth IRA are not tax deductible, but qualified withdrawals are tax-free. In addition, low and moderate-income taxpayers who make contributions to a traditional or Roth IRA may also qualify for the Saver's Credit. Eligible taxpayers can usually contribute up to $6,000 to an IRA for 2019. The limit is increased to $7,000 for taxpayers who were age 50 or older by the end of 2019. Contributions to traditional IRAs are deductible up to the lesser of the contribution limit or 100% of the taxpayer's compensation. Compensation is generally what a person earns from working. However, if a taxpayer is covered by a workplace retirement plan, the deduction for contributions to a traditional IRA for tax year 2019 is reduced if the taxpayer's modified adjusted gross income (MAGI) is: More than $64,000 but less than $74,000 for a single individual, head of household, or a married person filing separately who didn't live with their spouse at any time in 2019. No deduction if $74,000 or more.   More than $103,000 but less than $123,000 for a married couple filing a joint return or a qualifying widow(er). No deduction if $123,000 or more.   More than $193,000 but less than $203,000 for a married couple filing a joint return where one spouse is covered by a retirement plan at work and the other is not. No deduction if $203,000 or more.   Less than $10,000 for a married individual filing separately and lived with their spouse at any time during 2019. No deduction if $10,000 or more. Even though contributions to Roth IRAs are not tax deductible, for tax year 2019 the maximum amount a taxpayer can contribute is reduced if their MAGI is: $122,000 or more for a single individual, head of household, or a married person filing separately who didn't live with their spouse at any time in 2019. No contribution allowed if MAGI is $137,000 or more.   $193,000 or more for a married couple filing jointly or a qualifying widow(er). No contribution allowed if MAGI is $203,000 or more.   Less than $10,000 for a married individual filing separately and lived with their spouse at any time during 2019. No contribution if $10,000 or more. The Retirement Savings Contributions Credit, also known as the Saver's Credit, is often available for IRA contributors if their adjusted gross income falls below certain levels. For 2019, taxpayers may be able to claim the credit if their MAGI was not more than: $64,000 for married filing jointly.   $48,000 for head of household.   $32,000 for single, married filing separately or a qualifying widow(er). Taxpayers should use Form 8880, Credit for Qualified Retirement Savings Contributions, to claim the Saver's Credit. The instructions have details on how to figure the credit. Worksheets related to IRAs are available in the Form 1040 InstructionsPDF or in Publication 590-A, Contributions to Individual Retirement ArangementsPDF. The deduction for IRA contributions is claimed on Form 1040PDF, Schedule 1PDF. Nondeductible contributions to a traditional IRA are reported on Form 8606. Taxpayers should also be aware that special rules allow for tax-favored withdrawals and repayments from certain retirement plans for those affected by the coronavirus or those who suffer economic loss as a result of certain major disasters. Taxpayers can find answers to questions, get forms and instructions and find easy-to-use tools online at IRS.gov. More resources: Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs) Do I Qualify for the Retirement Savings Contributions Credit?

https://www.irs.gov/newsroom/irsgov-has-answers-about-filing-paying-and-july-15-due-date

IR-2020-145, July 9, 2020 WASHINGTON — As the July due date for filing a tax return draws closer, the Internal Revenue Service reminds taxpayers about the many resources available on IRS.gov. Whether on home computers or mobile devices, the number of taxpayers visiting IRS.gov continues to grow year after year. Easy-to-use tools, available 24 hours a day on the IRS website, have been used more than 1.2 billion times this year. IRS.gov is home to IRS Free File, Where's My Refund?, the Tax Withholding Estimator and a host of other convenient applications. Additional help is available in Publication 17, Your Federal Income Tax (For Individuals), available on IRS.gov. Publication 17 is also available as an eBook. Taxpayers who have yet to file their tax returns should file electronically now and choose direct deposit if they're getting a refund. Taxpayers who owe for tax year 2019 can pay anytime up to the July 15 due date. File electronically for free Taxpayers whose income was $69,000 or less last year are eligible to use the IRS Free File software to do their taxes. Also, regardless of income, any taxpayer who is comfortable preparing their own taxes can use Free File Fillable Forms. Taxpayers can use these electronic versions of IRS tax forms to complete their taxes and file them online. Free File options are available at IRS.gov/freefile. Get answers to tax questions Taxpayers can find answers to many of their questions using the Interactive Tax Assistant. It's a tax law resource that uses a series of questions and responses to help. IRS.gov also has answers to Frequently Asked Questions on a variety of topics. The IRS website also has tax information in: Spanish (Español); Chinese (中文); Korean (한국어); Russian (Pусский); Vietnamese (Tiếng Việt); and Haitian Creole (Kreyòl ayisyen). Where's My Refund? Taxpayers can easily find the most up-to-date information about their tax refund using the Where's My Refund? tool on IRS.gov and on the IRS mobile app, IRS2Go. Within 24 hours after the IRS acknowledges receipt of an electronically filed return, taxpayers can start checking on the status of their refund. Schedule a payment Taxpayers can file now and schedule their federal tax payments up to the July 15 due date. They can pay online, by phone or with their mobile device and the IRS2Go app. When paying federal taxes electronically, taxpayers should remember: Electronic payment options are the best way to make a tax payment. They can pay when they e-file by using tax software online. If using a tax preparer, taxpayers should ask the preparer to make the tax payment through an electronic funds withdrawal from a bank account. IRS Direct Pay allows taxpayers to pay online directly from a checking or savings account for free. Taxpayers can choose to pay with a credit card, debit card or digital wallet option through a payment processor. No fees go to the IRS. The IRS2Go app provides mobile-friendly payment options, including Direct Pay and payment processors on mobile devices. Taxpayers may also enroll in the Electronic Federal Tax Payment System and pay online or by phone. They can pay with cash at a retail partner. New locations available. Taxpayers can go to IRS.gov/account to securely access information about their federal tax account. They can view the amount they owe, access their tax records online, review their payment history and view key information for the most recent tax return as originally filed. Not required to file a tax return? Non-Filers tool available to register for Economic Impact Payments People who are not normally required to file a tax return and don't plan to do so can use the Non-Filers tool to get an Economic Impact Payment. The only way they can get this payment is to register with the IRS by using this free tool. Available in both English and Spanish, the tool was developed jointly by the IRS and the Free File Alliance. The registration deadline is Oct. 15, 2020. More information IRS.gov/covidtaxdeadlines IRS.gov/payments IRS.gov/account IRS.gov/ita IRS.gov/estimatedtaxes

https://www.irs.gov/newsroom/treasury-irs-issue-guidance-on-reporting-qualified-sick-and-family-leave-wages-paid

IR-2020-144, July 8, 2020 WASHINGTON — The Treasury Department and the Internal Revenue Service today provided guidance in Notice 2020-54PDF to employers requiring them to report the amount of qualified sick and family leave wages paid to employees under the Families First Coronavirus Response Act (FFCRA) on Form W-2. Employers will be required to report these amounts either on Form W-2, Box 14, or in a statement provided with the Form W-2. The guidance provides employers with optional language to use in the Form W-2 instructions for employees. The wage amount that the notice requires employers to report on Form W-2 will provide self-employed individuals who are also employees with the information necessary to determine the amount of any sick and family leave equivalent credits they may claim in their self-employed capacities. Additional information about tax relief for those affected by the COVID-19 pandemic can be found on IRS.gov.

https://www.irs.gov/newsroom/irs-resources-available-in-english-spanish-and-other-languages-to-help-taxpayers-still-needing-to-file-their-2019-tax-returns

IR-2020-143, July 8, 2020 WASHINGTON — As the tax-filing deadline fast approaches, the Internal Revenue Service reminds taxpayers with limited English proficiency and who have yet to file their 2019 tax returns that there are a variety of ways to get help and information in languages other than English. "Providing additional materials in more languages to help taxpayers is a priority for the IRS," said IRS Commissioner Chuck Rettig. "These resources are just a start for the IRS. In the months ahead, we will be working to add more material on IRS.gov. We also continue to work with our partners in the tax community to help translate and share more tax materials into different languages. For example, we are extremely proud to have material related to Economic Impact Payments translated into more than 30 different languages with the help of our partners." The IRS provides some tax information on its IRS.gov website in up to seven languages, including English, Spanish, Chinese, Korean, Russian, Vietnamese and Haitian-Creole. To get information in one of these languages, taxpayers can click on the language dropdown tab at the top of IRS.gov pages. The tab displays the current language selection and other languages a taxpayer can choose to view translated content. IRS.gov pages translated into one or more languages also have links to available translations on the right side of the page, just below the title. For example, the Let Us Help You page highlights IRS resources for taxpayers in six languages. This page offers information on notices, payments and numerous other topics. A helpful page for people wanting to plan for the future is the Steps To Take Now To Get A Jump On Next Year's Taxes page, available in seven languages. Other resources for people with limited English proficiency on IRS.gov include: IRS Free File for taxpayers with income of $69,000 and below, English and Spanish Direct Pay with Bank Account to pay your tax bill for free from your bank account, English and Spanish Check your refund status with Where's My Refund, English and Spanish Information on Electronic Filing Options for Individuals, six languages Information on Reporting Phishing and Online Scams, six languages Publication 17, Your Federal Income Tax, English and Spanish Answers to questions about tax relief related to COVID-19 and Economic Impact Payments, English and Spanish Free IRS2Go app for use on Apple and Android devices, English and Spanish Watch out for scams targeted to non-English speakers IRS impersonators and other scammers target people with limited access to information, including individuals not entirely comfortable with the English language. These scams are often threatening in nature and pose a major threat to these communities. These scams frequently take the form of a "robocall" (a text-to-speech recorded message with instructions for returning the call), but in some cases may be made by an actual person. These con artists may have some personal data, including the taxpayer's address, the last four digits of their Social Security number, among other things – making the calls seem more legitimate. One common IRS impersonation scam involves the taxpayer receiving a telephone call threatening jail time, deportation or revocation of a driver's license from someone claiming to be with the IRS. Taxpayers who are recent immigrants to the United States often are the most vulnerable and should ignore these threats and not engage the scammers. People should watch out for scams using email, phone calls or texts related to the payments. Be careful and cautious: The IRS will not send unsolicited electronic communications asking people to open attachments, visit a website or share personal or financial information. Information on how to Report Phishing and Online Scams is available in six languages.

https://www.irs.gov/newsroom/taxpayers-need-to-resume-payments-by-july-15

IR-2020-142, July 8, 2020 WASHINGTON — The IRS today reminds taxpayers who took advantage of the People First Initiative tax relief and did not make previously owed tax payments between March 25 to July 15 that they need to restart their payments. As the IRS continues to reopen its operations across the country, taxpayers who were in payment agreements and skipped any payments from March 25 and July 15 should start paying again to avoid penalties and possible default on their agreements. "Through the People First Initiative, we have endeavored to provide unprecedented relief to help those who owed federal taxes and allow them extra time," said IRS Commissioner Chuck Rettig. "As we resume a phased-in approach to our normal operations, we are sympathetic to the many Americans still suffering COVID-related hardships and stand ready to continue offering help to those who need it." Here's what taxpayers should do to resume their payment agreements to the IRS, including Installment Agreements, Offers in Compromise, and Private Debt Collection program payments: Installment Agreements Taxpayers who suspended their installment agreement payments between April 1 and July 15, 2020, will need to resume their payments by their first monthly payment due date after July 15. Taxpayers should be aware that the IRS didn't default their agreement, but interest did accrue, and the balance remained. Taxpayers who had their bank suspend direct debit payments should contact the bank immediately to ensure their first monthly payment due date occurring on or after July 15, 2020 is sent to avoid penalties. If a taxpayer can't meet their current installment agreement terms due to a COVID related hardship, they can revise the agreement on IRS.gov/paymentplan or call the customer service number on their IRS notice if they have a Direct Debit Installment Agreement (DDIA). Offer in Compromise Pending Offers: If the IRS is currently reviewing a taxpayer's submitted offer but hasn't accepted it yet, the taxpayer should resume their required payments starting July 15, 2020. The IRS will amend the taxpayer's offer to allow them to pay any skipped payments at the end of the offer period, if the offer is accepted. Already Accepted Offers: If a taxpayer has an Offer in Compromise agreement, and the taxpayer was unable to make the payments on their accepted offer because of a COVID-19 hardship, the taxpayer should resume payments and make up the missed payments by July 15, 2020. If the taxpayer is unable to make up the missed payments, they can contact the number on the IRS notice to discuss their situation. Private Debt Collection The IRS did not forward new delinquent accounts to Private Collection Agencies (PCAs) from April 1 through July 15, 2020, and PCA interaction with taxpayers was limited to inbound telephone calls unless requested by a taxpayer in a voicemail or correspondence. Taxpayers who had their PCA payments on hold should resume payments by July 15. The IRS encourages taxpayers to work with their assigned PCA to establish a new payment arrangement or restructure an existing one based on their current situation. Taxpayers Who Owe But Can't Pay The IRS reminds taxpayers who are experiencing a hardship or who have questions about their payments to call the customer service number provided on their notice but be mindful that wait times could be long. Phone lines remain extremely busy as the IRS resumes operations. Taxpayers also have a variety of options through IRS.gov/payments to make one time or recurring payments without having to contact the IRS.

https://www.irs.gov/newsroom/reminder-to-tax-exempt-organizations-990s-other-forms-due-july-15-e-file-best-way-to-file

IR-2020-141, July 7, 2020 WASHINGTON — The Internal Revenue Service today reminds tax-exempt organizations that certain forms they file with the IRS are due on July 15, 2020. For organizations that operate on a calendar-year basis, this includes the 2019 Form 990 they would have normally filed on May 15. The upcoming July 15 deadline applies to many forms that were originally due May 15, including: Form 990-series annual information returns (Forms 990, 990-EZ, 990-PF, 990-BL) Form 990-N, Electronic Notice (e-Postcard) for Tax-Exempt Organizations Not Required to File Form 990 or Form 990-EZ Forms 8871, Political Organization Notice of Section 527 Status Form 8872, Political Organization Report of Contributions and Expenditures Form 990-T, Exempt Organization Business Income Tax Return Form 1120-POL, Political Organization Filing Requirements Form 4720, Private Foundation Excise Tax Return Tax-exempt organizations that need additional time to file beyond the July 15 deadline can request an automatic extension by filing Form 8868, Application for Extension of Time to File an Exempt Organization Return. An organization will be allowed a six-month extension beyond the original due date. For a calendar-year 2019 return, this means the extended deadline would be Nov. 15, 2020. In situations where tax is due, extending the time for filing a return does not extend the time for paying tax. The IRS urges all organizations to take advantage of the speed and convenience of filing their returns electronically when possible.

https://www.irs.gov/newsroom/irs-reminds-members-of-the-us-armed-forces-of-special-tax-breaks-helpful-resources-as-the-july-15-tax-deadline-approaches

IR-20-140, July 7, 2020 WASHINGTON ― The Internal Revenue Service today encouraged members of the military and their families to learn more about the special tax benefits available to them as the July 15 tax filing season deadline approaches. Most military bases offer free tax preparation and filing assistance during the tax filing season. Some also offer free tax help after the July tax filing deadline. Some of these programs may be impacted by the current COVID-19 so it's best to check first. Service members who prepare their own tax return qualify to e-file their federal return for free using IRS Free File if their income in 2019 was below $69,000. All military members and some qualified veterans may use MilTax, a free tax service from the Department of Defense and Military OneSource. The IRS also offers Free Fillable Forms which can completed online and then filed electronically regardless of income amount. "Military members serving our country at home and abroad earn the IRS' highest appreciation and ongoing support," said IRS Commissioner Chuck Rettig. "We have resources available at IRS.gov that detail the special circumstances that can affect tax payment and return filing deadlines for military personnel and their families. We encourage them to visit our website. We are also very proud of the many veterans employed by and part of the IRS team." IRS Publication 3, Armed Forces Tax Guide, is a free booklet filled with valuable information and tips designed to help service members and their families take advantage of all the tax benefits allowed by law. Several key benefits are outlined below. Combat pay is partially or fully tax-free. Service members serving in support of a combat zone or in a qualified hazardous duty area may also qualify for this exclusion. In addition, U.S. citizens or resident aliens, such as spouses, that worked as contractors or employees of contractors supporting the U.S. Armed Forces in designated combat zones, may now qualify for the foreign earned income exclusion.   Members of the military who serve or have served in a combat zone or in contingency operations outside the United States, may qualify for an extension of at least 180 days to file and pay their taxes.   The Earned Income Tax Credit is worth up to $6,660. Low- and moderate-income service members who receive nontaxable combat pay can use a special computation method that may boost the EITC, meaning they may owe less tax or get a larger refund.   A service member and their spouse can each choose to have their nontaxable combat pay included in their earned income for purposes of the EITC. Service members are encouraged to select the option that best benefits them.   Those who served in the Sinai Peninsula of Egypt may qualify for combat zone tax benefits retroactive to June 2015. Under the Tax Cuts and Jobs Act (TCJA) members of the U.S. Army, U.S. Navy, U.S. Marines, U.S. Air Force, and U.S. Coast Guard who performed services in the Sinai Peninsula can now claim combat zone tax benefits. Dependent care assistance programs for military personnel are excludable benefits and not included in the military member's income. The moving expenses deduction is suspended in tax years 2018 through 2025, except for certain Service members. Active duty Service members who move pursuant to a permanent change of station order may still claim this deduction. Also, Service members who move due to a permanent change of station order may exclude from tax any moving reimbursements they receive.  Both spouses normally must sign a joint income tax return, but if one spouse is absent due to certain military duty or conditions, the other spouse may be able to sign for him or her. A power of attorney is required in other instances. A military installation's legal office may be able to help. The IRS has a special page on IRS.gov with Tax Information for Members of the U.S. Armed Forces.

https://www.irs.gov/newsroom/find-a-qualified-tax-professional-using-irs-website-resources

IR-2020-139, July 6, 2020 WASHINGTON — With the federal income tax deadline just around the corner, the Internal Revenue Service wants to remind taxpayers that IRS.gov offers tips on finding a qualified tax professional. Over 84 million tax returns were prepared by a paid return preparer last year. Though most tax professionals provide honest, high-quality service, taxpayers should keep in mind these basic tips when selecting a tax professional: Choose a trusted preparer. Taxpayers entrust vital personal data with the person preparing their tax return, including Social Security numbers and information on income and investments. Review the tax return carefully before signing. Taxpayers are legally responsible for what's on their tax return, regardless of whether someone else prepared it. If something does not look right, don't hesitate to ask questions. Make sure the preparer signs the return and includes their Preparer Tax Identification Number (PTIN). Never sign a blank tax return. Consider it a red flag when a taxpayer is asked to sign a blank tax return. Ask about service fees. Avoid preparers who base fees on a percentage of their client's refund or boast bigger refunds than their competition. Taxpayers can use several options to help find a tax preparer. One resource is Choosing a Tax Professional, which includes a wealth of consumer guidance for selecting a tax professional. There are various types of tax return preparers, including enrolled agents, certified public accountants, attorneys and some who don't have a professional credential. The Directory of Federal Tax Return Preparers with Credentials and Select Qualifications is a free searchable and sortable database. It includes the name, city, state and zip code of credentialed return preparers who are CPAs, enrolled agents or attorneys, as well as those who have completed the requirements for the IRS Annual Filing Season Program. A search of the database can help taxpayers verify credentials and qualifications of tax professionals or locate a tax professional in their geographic area. The IRS requires anyone who prepares any federal tax return for compensation to have a PTIN. For 2020, the IRS has issued more than 773,000 PTINs. There is also a page with IRS Tax Pro Association Partners that includes links to national nonprofit tax professional groups that can help taxpayers seek the right type of qualified help from a tax preparer. More resources: Things to remember when choosing a tax preparer How to Choose a Tax Return Preparer When, and how, do I file a complaint about a tax preparer? Most taxpayers eligible for free federal and free state tax return preparation

https://www.irs.gov/newsroom/treasury-department-and-irs-issue-guidance-for-consolidated-groups-regarding-net-operating-losses

IR-2020-138, July 2, 2020 WASHINGTON — The Department of the Treasury and the Internal Revenue Service today issued proposed regulations and temporary regulations that provide guidance for consolidated groups regarding net operating losses (NOLs). The Tax Cuts and Jobs Act (TCJA) and the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) amended the rules for NOLs. After amendment, the NOL deduction is the sum of: The total of the NOLs arising before January 1, 2018 (pre-2018 NOLs) that are carried to that year; plus The lesser of: The total of the NOLs arising after December 31, 2017; or 80% of taxable income less pre-2018 NOLs (the 80% limitation). The TCJA generally eliminated NOL carrybacks and permitted NOLs to be carried forward indefinitely. The TCJA also provides special rules for nonlife insurance companies and farming losses. Nonlife insurance companies are permitted to carry back NOLs two years and forward 20 years, and the 80% limitation does not apply. Farming losses are permitted to be carried back two years and carried forward indefinitely, subject to the 80% limitation. The CARES Act effectively delays the application of the TCJA amendments until January 1, 2021. Additionally, the CARES Act permits a five-year carryback for NOLs, including farming losses and NOLs of nonlife insurance companies, for taxable years beginning after December 31, 2017 and before January 1, 2021. The proposed regulations provide guidance to consolidated groups on the application of the 80% limitation. Additionally, the proposed regulations would remove obsolete provisions from the rules for consolidated groups that contain both life insurance companies and nonlife insurance companies.  Because the CARES Act allows certain NOLs to be carried back five years, the temporary regulations allow certain acquiring consolidated groups to make an election to waive all or a portion of the pre-acquisition portion of the extended carryback period for certain losses attributable to certain acquired members. For more information about this and other TCJA provisions, visit IRS.gov/taxreform. Additional information about tax relief for businesses affected by the COVID-19 pandemic can be found on IRS.gov.

https://www.irs.gov/newsroom/irs-offers-additional-retail-partners-that-accept-cash-payments-for-federal-taxes

IR-2020-137, July 1, 2020 WASHINGTON ― The Internal Revenue Service today announced additional retail partners are accepting cash payments for federal taxes. This cash payment option is for individual and business taxpayers. The IRS' continuing partnership with ACI Worldwide's OfficialPayments.com and the PayNearMe Company allows taxpayers to make a payment without a bank account or credit card at participating 7-Eleven stores, Ace Cash Express and Casey's General Stores nationwide. "We continuously look for ways to enhance the services we provide for our taxpayers," said IRS Wage and Investment Division Commissioner Ken Corbin. "The IRS offers many ways for taxpayers to pay their tax bills including direct debit, credit card and through electronic funds withdrawal when filing electronically. This cash option lets people pay their taxes without having to make an appointment at an IRS Taxpayer Assistance Center." Individuals wishing to take advantage of this payment option should visit the IRS.gov/payments, select the cash option in the "Other Ways You Can Pay" section and follow the instructions. There is a $1,000 payment limit per day and a $3.99 fee per payment. Because PayNearMe involves a three-step process, the IRS urges taxpayers choosing this option to start the process well ahead of the tax deadline to avoid interest and penalty charges. The IRS reminds individuals without the need to pay in cash that there are other ways to pay online, by phone or with a mobile device and the IRS2Go app. IRS Direct Pay is a secure online payment option that allows taxpayers to pay directly from their bank accounts for free. The IRS has been partnering with Official Payments since 1999 for taxpayers wanting to use a credit card to pay their taxes. The IRS reminds taxpayers to watch out for email schemes. Taxpayers will only receive an email from OfficialPayments.com or PayNearMe if they have initiated the payment process.

https://www.irs.gov/newsroom/irs-provides-tax-relief-for-the-low-income-housing-credit-and-bonds-for-qualified-residential-rental-projects

IR-2020-136, July 1, 2020 WASHINGTON – In response to the ongoing COVID-19 pandemic, the Internal Revenue Service today issued Notice 2020-53 PDF to provide tax relief to issuers, operators, owners, and tenants of qualified low-income housing projects or qualified residential rental projects financed with exempt facility bonds, and state agencies that have jurisdiction over these projects. For certain time-sensitive actions scheduled to be performed and requirements to be met on or after April 1, 2020 and before December 31, 2020, owners and operators now have until December 31, 2020 to perform the actions and satisfy the requirements. Further, between April 1, 2020 and December 31, 2020, owners of qualified low-income housing projects are not required to perform certain income recertifications or reduce the eligible basis in a building because of the temporary closure of an amenity or common area due to the COVID-19 pandemic, and state agencies that have jurisdiction over the projects are not required to conduct compliance-monitoring. Additionally, between April 1, 2020 and December 31, 2020, owners and operators of these projects, issuers, and state agencies may treat medical personnel and other essential workers providing services during the COVID-19 pandemic as if they were Displaced Individuals, as defined in Rev. Procs. 2014-49 and 2014-50, and therefore, may provide emergency housing for these persons as described in these revenue procedures. Additional information about tax relief for those affected by the COVID-19 pandemic can be found on IRS.gov. The Internal Revenue Service also is issuing proposed regulationsPDF relating to the compliance-monitoring duties of state agencies for purposes of the low-income housing credit. The proposed regulations relax the minimum compliance-monitoring sampling requirement for purposes of physical inspections and low-income certification review, providing flexibility and reduced burdens with respect to the requirements set forth in the final regulations published on February 26, 2019.

https://www.irs.gov/newsroom/irs-unclaimed-refunds-of-1-point-5-billion-waiting-for-tax-year-2016-taxpayers-face-july-15-deadline

IR-2020-135, July 1, 2020 WASHINGTON — Unclaimed income tax refunds worth more than $1.5 billion await an estimated 1.4 million individual taxpayers who did not file a 2016 federal income tax return, according to the Internal Revenue Service. "The IRS wants to help taxpayers who are owed refunds but haven't filed their 2016 tax returns yet," said IRS Commissioner Chuck Rettig. "Time is quickly running out for these taxpayers. There's only a three-year window to claim these refunds, and the window closes on July 15. To claim the refund, a return for tax year 2016 must be filed by July 15, 2020." In Notice 2020-23PDF, the IRS extended the due date for filing tax year 2016 returns and claiming refunds for that year to July 15, 2020, as a result of the COVID-19 pandemic. As the IRS is issuing Economic Impact Payments to Americans, the agency urges taxpayers who haven't filed past due tax returns to file now to claim these valuable refunds. To collect refunds for tax year 2016, taxpayers must file their 2016 tax returns with the IRS no later than this year's extended tax due date of July 15, 2020. The IRS estimates the midpoint for the potential refunds for 2016 to be $861 — that is, half of the refunds are more than $861 and half are less. In cases where a federal income tax return was not filed, the law provides most taxpayers with a three-year window of opportunity to claim a tax refund. If they do not file a tax return within three years, the money becomes the property of the U.S. Treasury. For 2016 tax returns, the window closes July 15, 2020, for most taxpayers. The law requires taxpayers to properly address, mail and ensure the tax return is postmarked by the July 15 date. The IRS reminds taxpayers that there is no penalty for filing late when a refund is involved. Taxpayers seeking a 2016 tax refund should know that their checks may be held if they have not filed tax returns for 2017 and 2018. In addition, the refund will be applied to any amounts owed to the IRS or a state tax agency and may be used to offset unpaid child support or past due federal debts, such as student loans. By failing to file a tax return, people stand to lose more than just their refund of taxes withheld or paid during 2016. Many low- and moderate-income workers may be eligible for the Earned Income Tax Credit (EITC). For 2016, the credit was worth as much as $6,269. The EITC helps individuals and families whose incomes are below certain thresholds. The thresholds for 2016 were: $47,955 ($53,505 if married filing jointly) for those with three or more qualifying children; $44,648 ($50,198 if married filing jointly) for people with two qualifying children; $39,296 ($44,846 if married filing jointly) for those with one qualifying child, and; $14,880 ($20,430 if married filing jointly) for people without qualifying children. Current and prior year tax forms (such as the tax year 2016 Form 1040, 1040-A and 1040-EZ) and instructions are available on the IRS.gov Forms and Publications page or by calling toll-free 800-TAX-FORM (800-829-3676). Taxpayers who are missing Forms W-2, 1098, 1099 or 5498 for the years 2016, 2017 or 2018 should request copies from their employer, bank or other payer. Taxpayers who are unable to get missing forms from their employer or other payer can order a free wage and income transcript at IRS.gov using the Get Transcript Online tool. Alternatively, they can mail Form 4506-T to request a wage and income transcript. A wage and income transcript shows data from information returns received by the IRS, such as Forms W-2, 1099, 1098, Form 5498 and IRA contribution information. Taxpayers can use the information from the transcript to file their tax return. State-by-state estimates of individuals who may be due 2016 income tax refunds State or District Estimated Number of Individuals Median Potential Refund Total Potential Refunds* Alabama 23,300 $859 $24,614,400 Alaska 5,500 $979 $6,754,900 Arizona 32,400 $762 $32,281,600 Arkansas 13,400 $822 $13,798,800 California 130,600 $816 $135,981,300 Colorado 27,500 $809 $28,276,500 Connecticut 14,300 $930 $16,213,300 Delaware 5,600 $878 $6,114,500 District of Columbia 3,700 $904 $4,224,600 Florida 99,000 $874 $105,706,400 Georgia 48,600 $792 $49,682,700 Hawaii 7,700 $932 $8,785,600 Idaho 6,200 $727 $5,876,000 Illinois 51,700 $909 $57,312,200 Indiana 32,700 $887 $35,129,700 Iowa 14,700 $908 $15,735,600 Kansas 14,600 $877 $15,706,800 Kentucky 18,700 $869 $19,517,100 Louisiana 24,400 $849 $26,410,100 Maine 5,600 $802 $5,482,200 Maryland 28,200 $873 $31,619,700 Massachusetts 29,900 $956 $34,261,900 Michigan 46,600 $853 $49,591,400 Minnesota 21,000 $803 $21,155,300 Mississippi 12,900 $777 $12,931,600 Missouri 32,400 $828 $33,522,400 Montana 4,600 $781 $4,582,000 Nebraska 7,800 $845 $8,081,700 Nevada 15,900 $859 $16,922,300 New Hampshire 6,500 $965 $7,474,300 New Jersey 36,200 $936 $41,268,900 New Mexico 9,600 $833 $10,219,600 New York 70,300 $958 $80,830,100 North Carolina 44,900 $833 $46,044,500 North Dakota 4,000 $949 $4,539,800 Ohio 52,900 $841 $54,542,900 Oklahoma 21,000 $866 $22,600,000 Oregon 21,400 $762 $21,237,200 Pennsylvania 55,200 $919 $60,505,200 Rhode Island 3,900 $926 $4,410,100 South Carolina 17,200 $769 $17,323,700 South Dakota 3,800 $899 $3,976,100 Tennessee 29,000 $840 $29,834,800 Texas 143,400 $898 $159,809,900 Utah 11,100 $766 $11,037,700 Vermont 2,800 $892 $2,897,400 Virginia 37,900 $827 $39,977,600 Washington 37,200 $918 $42,273,300 West Virginia 7,200 $921 $7,830,000 Wisconsin 19,900 $781 $19,483,100 Wyoming 3,400 $920 $3,766,100 Totals 1,418,300 $861 $1,518,154,900 *Excluding credits.

https://www.irs.gov/newsroom/thursday-sept-3-irs-webinar-focuses-on-opportunity-zones

IR-2020-198, August 31, 2020 WASHINGTON — The Internal Revenue Service is holding a free webinar designed to give an overview of Opportunity Zones and to discuss related tax benefits for investors. Opportunity Zones are an economic development tool that allows people to invest in distressed areas in the United States. This free 75-minute webinar will take place on Thursday, September 3 at 2 p.m. Eastern Time. It is open to investors, tax professionals, government agencies and anyone else interested in the tax rules that affect Opportunity Zones. In addition to the overview, topics to be covered include: Investor reporting elections Annual investor reporting requirements Impact of disaster relief on Opportunity Zones The webinar will feature a live question and answer session and will be closed captioned for viewers who are deaf or hearing impaired. Anyone interested in attending can register online. For more information on Opportunity Zones, visit the general Opportunity Zones page and the Opportunity Zones Frequently Asked Questions. Archived versions of past IRS webinars are available at www.irsvideos.gov.

https://www.irs.gov/newsroom/irs-provides-tax-relief-for-victims-of-hurricane-laura-oct-15-deadline-other-dates-extended-to-dec-31

Updated 9/10/20: This news release has been updated to include Morehouse and Union parishes. Updated 9/2/20: This news release has been updated to include Grant, Jackson, Lincoln, Natchitoches, Rapides, Sabine and Winn parishes. IR-2020-197, August 31, 2020 WASHINGTON — Victims of Hurricane Laura that began August 22 now have until December 31, 2020, 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, Allen, Beauregard, Calcasieu, Cameron, Grant, Jackson, Jefferson Davis, Lincoln, Morehouse, Natchitoches, Ouachita, Rapides, Sabine, Union, Vermillion, Vernon, and Winn parishes in Louisiana, 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. The tax relief postpones various tax filing and payment deadlines that occurred starting on August 22, 2020. As a result, affected individuals and businesses will have until December 31, 2020, 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 December 31, 2020, 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 December 31, 2020 deadline also applies to quarterly estimated income tax payments due on September 15, 2020, and the quarterly payroll and excise tax returns normally due on November 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 November 16, 2020. Businesses with extensions also have the additional time including, among others, calendar-year corporations whose 2019 extensions run out on October 15, 2020. In addition, penalties on payroll and excise tax deposits due after August 22 and before Sept. 8, will be abated as long as the deposits are made by September 8, 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 – 4559 − for Hurricane Laura 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 this storm and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.

https://www.irs.gov/newsroom/settlements-begin-in-syndicated-conservation-easement-transaction-initiative

IR-2020-196, August 31, 2020 WASHINGTON — As part of a continuing effort to combat abusive transactions, the Internal Revenue Service announced today the completion of the first settlement under its initiative to resolve certain docketed cases involving syndicated conservation easement transactions. On June 25, 2020, the IRS Office of Chief Counsel announced that it would offer to settle certain cases involving abusive syndicated conservation easement transactions. Since then, Chief Counsel has sent letters to dozens of partnerships involved in these transactions whose cases are pending before the U.S. Tax Court. "We are seeing movement on these settlements," said IRS Chief Counsel Mike Desmond. "Given the potential for significant penalties, we anticipate more taxpayers will take similar actions and ultimately accept these offers, and we encourage them to do so." The IRS will continue to actively identify, audit and litigate these abusive transactions as part of its vigorous effort to combat abuse in this area. These transactions undermine the public's trust in tax incentives for private land conservation and in tax compliance in general. Ending these abusive schemes remains a top priority for the IRS. The IRS continues to strongly recommend that participants seek the advice of competent, independent advisors in considering the potential resolution of their matter. The settlement requires a concession of the tax benefits claimed by the taxpayers and imposes penalties: All partners in an electing partnership must agree to settle to receive these terms, and the partnership must make a lump-sum payment representing the aggregate tax, penalties and interest for all of the partners before settlement is accepted by the IRS. Chief Counsel will allow investors to deduct the cost of acquiring their partnership interests but it will require a penalty of at least 10 percent. Partners who are promoters of conservation easement schemes are not allowed any deductions and must pay the maximum penalty asserted by IRS (typically 40 percent). If less than all the partners agree to settle, the IRS may settle with those partners but will normally impose less favorable terms on the settling partners. This week, the first settlement under the terms of the initiative was finalized. Coal Property Holdings, LLC and its partners agreed to a disallowance of the entire $155 million charitable contribution deduction claimed for an easement placed on a 3,700-acre tract of land in Tennessee. On October 28, 2019, the Tax Court issued its Opinion (153 T.C. 126) granting the government's motion for partial summary judgment holding that the "judicial extinguishment" provisions of the easement deed did not satisfy the requirements of section 1.170A-14(g)(6), Income Tax Regs. Under the terms of the settlement, the investor partners were permitted to deduct their cost of investing in the conservation easement transactions and paid a 10 percent penalty, whereas the promoter partner was denied any deduction and paid a 40% penalty. The taxpayers also fully paid all tax, penalties, and interest in conjunction with the settlement. The settlement will be reflected in a stipulated decision document entered by the Tax Court and in a separately entered closing agreement. A public statement acknowledging the settlement was part of the agreement between the IRS and the taxpayer. IRS Commissioner Chuck Rettig thanked the trial team for their exceptional dedication and work on the case: "The IRS is pleased that the partnership in the Coal Property transaction has agreed to this settlement, and we encourage other participants in qualifying easement cases to accept the terms of the Chief Counsel's initiative," Rettig said. Coal Property was represented by Christopher S. Rizek and Scott D. Michel of the Washington, D.C. law firm Caplin & Drysdale. "In light of the significance of the Court's ruling on the perpetuity issue, our client decided to take advantage of an assured penalty reduction in the IRS initiative and settle this matter under the IRS's terms, and it is pleased that this case is resolved," Rizek said.

https://www.irs.gov/newsroom/guidance-issued-to-implement-presidential-memorandum-deferring-certain-employee-social-security-tax-withholding

IR-2020-195, August 28, 2020 WASHINGTON — The Department of Treasury and Internal Revenue Service today issued guidance PDF implementing the Presidential Memorandum issued on August 8, 2020, allowing employers to defer withholding and payment of the employee's portion of the Social Security tax if the employee's wages are below a certain amount. Notice 2020-65, posted today on IRS.gov, makes relief available for employers and generally applies to wages paid starting September 1, 2020, through December 31, 2020. The employee Social Security tax deferral may apply to payments of taxable wages to an employee that are less than $4,000 during a bi-weekly pay period, with each pay period considered separately. No deferral is available for any payment to an employee of taxable wages of $4,000 or above for a bi-weekly pay period. Today's notice postpones the time for employers to withhold and pay employee Social Security taxes. Additional tax relief related to the COVID-19 pandemic can be found on IRS.gov.

https://www.irs.gov/newsroom/irs-approves-temporary-use-of-e-signatures-for-certain-forms

Note:  Additional forms have been added and the temporary-use period has been extended until December 31, 2021. IR-2020-194, August 28, 2020 WASHINGTON — To protect the health of taxpayers and tax professionals, the Internal Revenue Service today announced PDF it will temporarily allow the use of digital signatures on certain forms that cannot be filed electronically. The change will help to reduce in-person contact and lessen the risk to taxpayers and tax professionals during the COVID-19 pandemic, allowing both groups to work remotely to timely file forms. "We take the health and safety of the nation's taxpayers, the tax professional community and our employees very seriously," said IRS Commissioner Chuck Rettig. "Expanding the use of digital signatures is an important step during COVID-19 to help tax professionals. We understand the importance of digital signatures to the tax community, and we will continue to review our processes to determine where long-term actions can help reduce burden for the tax community, while appropriately balancing that with critical security and protection against identity theft and fraud." The Form 1040, U.S. Individual Income Tax Return, already uses an electronic signature when it is filed electronically, either by using a taxpayer self-selected PIN, if self-prepared, or a tax-preparer selected PIN, if using a tax professional. More than 90% of Form 1040s are filed electronically. The IRS recommends all taxpayers consider e-filing forms this year, whenever possible, because of COVID-19. The below list of forms is available at IRS.gov and through tax professional's software products. These forms cannot be e-filed and generally are printed and mailed. The IRS will not specify which digital signature product tax professionals must use. There are several commercial products available. The following forms can be submitted with digital signatures if mailed by or on December 31, 2020: Form 3115, Application for Change in Accounting Method; Form 8832, Entity Classification Election; Form 8802, Application for U.S. Residency Certification; Form 1066, U.S. Income Tax Return for Real Estate Mortgage Investment Conduit; Form 1120-RIC, U.S. Income Tax Return For Regulated Investment Companies; Form 1120-C, U.S. Income Tax Return for Cooperative Associations; Form 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts; Form 1120-L, U.S. Life Insurance Company Income Tax Return; Form 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return; and Form 8453 series, Form 8878 series, and Form 8879 series regarding IRS e-file Signature Authorization Forms. The IRS will closely monitor this temporary option for e-signatures and determine if additional steps are needed.

https://www.irs.gov/newsroom/irs-accepting-applicants-for-the-compliance-assurance-process-for-2021

IR-2020-193, August 27, 2020 WASHINGTON — The Internal Revenue Service announced today the opening of the application period for the 2021 Compliance Assurance Process program. The application period runs September 1 to November 13, 2020. The IRS will inform applicants if they're accepted into the program in February 2021. Launched in 2005, CAP employs real-time issue resolution, through transparent and cooperative interaction between taxpayers and the IRS, to improve federal tax compliance by resolving issues prior to the filing of a tax return. To be eligible to apply for CAP, new applicants must: Have assets of $10 million or more, Be a U.S. publicly traded corporation with a legal requirement to prepare and submit SEC Forms 10-K, 10-Q, and 8-K, and Not be under investigation by, or in litigation with, any government agency that would limit the IRS's access to current tax records. To be eligible to participate in CAP, taxpayers must adhere to CAP program limits on the number of open years. For 2021, the IRS modified the open-year criteria, updated its requirements for the Tax Control Framework Questionaire and established a limit on the duration of the Bridge phase. Program details are available on the CAP webpage. A draft of the 2021 CAP Memorandum of Understanding has also been posted on the CAP webpage, and stakeholders can offer any feedback on the MOU by sending it to the CAP mailbox at lbi.irs.cap.program@irs.gov by November 13, 2020.

https://www.irs.gov/newsroom/irs-50000-spouses-to-get-catch-up-economic-impact-payments

IR-2020-192, August 25, 2020 WASHINGTON — The Internal Revenue Service will soon send catch-up Economic Impact Payment checks to about 50,000 individuals whose portion of the EIP was diverted to pay their spouse's past-due child support. These catch-up payments are due to be issued in early-to-mid-September. They will be mailed as checks to any eligible spouse who submitted Form 8379, Injured Spouse Allocation, along with their 2019 federal income tax return, or in some cases, their 2018 return. These spouses do not need to take any action to get their money. The IRS will automatically issue the portion of the EIP that was applied to the other spouse's debt. The IRS is aware that some individuals did not file a Form 8379, Injured Spouse Allocation, and did not receive their portion of the EIP for the same reason above. These individuals also do not need to take any action and do not need to submit a Form 8379. The IRS does not yet have a timeframe but will automatically issue the portion of the EIP that was applied to the other spouse's debt at a later date. Affected taxpayers can check the status of their Payment by using the Get My Payment tool, available only on IRS.gov. For more information, see the Receiving My Payment section of the Frequently Asked Questions in the Economic Payment Information Center on IRS.gov.

https://www.irs.gov/newsroom/irs-provides-tax-relief-for-victims-of-california-wildfires-oct-15-deadline-other-dates-extended-to-dec-15

IR-2020-191, August 24, 2020 WASHINGTON — Victims of the California wildfires that began August 14 now have until December 15, 2020 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 Lake, Monterey, Napa, San Mateo, Santa Cruz, Solano, Sonoma and Yolo 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. The tax relief postpones various tax filing and payment deadlines that occurred starting on August 14, 2020. As a result, affected individuals and businesses will have until December 15, 2020, 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 October 15, 2020, will now have until December 15, 2020, 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 December 15, 2020 deadline also applies to quarterly estimated income tax payments due on September 15, 2020, and the quarterly payroll and excise tax returns normally due on October 31, 2020. It also applies to tax-exempt organizations, operating on a calendar-year basis, that had a valid extension due to run out on November 15, 2020. Businesses with extensions also have the additional time including, among others, calendar-year corporations whose 2019 extensions run out on October 15, 2020. In addition, penalties on payroll and excise tax deposits due after August 14 and before August 31, will be abated as long as the deposits are made by August 31, 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 – 4558 − for 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 wildfires and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.

https://www.irs.gov/newsroom/irs-provides-tax-relief-for-victims-of-iowa-derecho-extends-oct-15-other-upcoming-deadlines-to-dec-15

Updated 9/2/20: This news release has been updated to include Benton, Boone, Cedar, Jasper, Marshall, Polk, Poweshiek, Scott, Story and Tama Counties IR-2020-190, August 24, 2020 WASHINGTON — Victims of the August 10 derecho storm that affected parts of Iowa now have until December 15, 2020, 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 Benton, Boone, Cedar, Jasper, Linn, Marshall, Polk, Poweshiek, Scott, Story, and Tama Counties in Iowa, 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. The tax relief postpones various tax filing and payment deadlines that occurred starting on August 10, 2020. As a result, affected individuals and businesses will have until December 15, 2020, 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 October 15, 2020, will now have until December 15, 2020, 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 December 15, 2020 deadline also applies to quarterly estimated income tax payments due on September 15, 2020, and the quarterly payroll and excise tax returns normally due on October 31, 2020. It also applies to tax-exempt organizations, operating on a calendar-year basis, that had a valid extension due to run out on November 15, 2020. Businesses with extensions also have the additional time including, among others, calendar-year corporations whose 2019 extensions run out on October 15, 2020.      In addition, penalties on payroll and excise tax deposits due after August 10 and before August 25, will be abated as long as the deposits are made by August 25, 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 – 4557 for Iowa − 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 severe storms and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.

https://www.irs.gov/newsroom/as-peak-hurricane-season-nears-irs-reminds-people-to-prepare-for-natural-disasters

IR-2020-189, August 24, 2020 WASHINGTON — The Internal Revenue Service reminds people to create or maintain an emergency preparedness plan. A well-thought-out plan is a critical component for surviving natural disasters. Taxpayers, whether individuals, organizations or businesses, should take time now to create or update their emergency plans. A solid plan includes securing and duplicating essential documents, creating lists of property and knowing where to find information once a disaster has occurred. Secure key documents and make copies Taxpayers should place original documents such as tax returns, birth certificates, deeds, titles and insurance policies inside waterproof containers in a secure space. Duplicates of these documents should be kept with a trusted person outside the area of the taxpayer. Scanning them for backup storage on electronic media such as a flash drive is another option that provides security and portability. Document valuables and equipment Current photos or videos of a home or business’s contents can help support claims for insurance or tax benefits after a disaster. All property, especially expensive and high value items, should be recorded. The IRS disaster-loss workbooks in Publication 584 can help individuals and businesses compile lists of belongings or business equipment. Employers should check fiduciary bonds Employers who use payroll service providers should ask the provider if it has a fiduciary bond in place. The bond could protect the employer in the event of default by the payroll service provider. The IRS reminds employers to carefully choose their payroll service providers. Rebuilding documents Reconstructing records after a disaster may be required for tax purposes, getting federal assistance or insurance reimbursement. Those who have lost some or all their records during a disaster can visit IRS’s Reconstructing Records webpage as one of their first steps.  IRS stands ready Taxpayers whose address of record is identified by the IRS as qualifying for disaster tax relief will automatically receive an extension to file and interest and payment relief for most tax returns and there is no need to call the IRS to request this relief.  The IRS lists the relief available and areas qualifying for relief on the Around the Nation website. Taxpayers impacted by a disaster with tax-related questions can contact the IRS at 866-562-5227 to speak with an IRS specialist trained to handle disaster-related issues. A taxpayer impacted by a disaster outside of a federally declared disaster area may qualify for disaster relief. This includes taxpayers who are not physically located in a disaster area, but whose records necessary to meet a filing or payment deadline postponed during the relief period are in a covered disaster area. Taxpayers located outside of a federally declared disaster area must self-identify to receive relief by calling 866-562-5227. Find complete disaster assistance and emergency relief details for both individuals and businesses on IRS.gov. Related items: Publication 2194, Disaster Resource Guide for Individuals and BusinessesPDF Publication 583, Starting a Business and Keeping Records FS-2017-11, Reconstructing Records After a Natural Disaster or Casualty Loss; IRS Provides Tips to Help Taxpayers Federal Emergency Management Agency Small Business Administration Disasterassistance.gov Ready.gov For more information about National Preparedness Month, visit ready.gov/september.

https://www.irs.gov/newsroom/irs-updates-procedures-for-designating-taxpayer-disputes-for-litigation-implementing-provisions-of-taxpayer-first-act

IR-2020-188, August 24, 2020 WASHINGTON — The Internal Revenue Service today issued a memorandum PDF that provides interim guidance to the agency's compliance staff on requests to designate issues for litigation. Designation of issues for litigation, a decision that is made with the Office of Chief Counsel, limits a taxpayer's opportunity to administratively resolve their case with the IRS Independent Office of Appeals. Disputes between the IRS and taxpayers over designated issues must be resolved through litigation. The IRS took this step to update and clarify its designation procedures as part of its implementation of the Taxpayer First Act (TFA) enacted in July 2019. The IRS's approach of judiciously designating issues for litigation balances the need to soundly administer the tax law while recognizing the important role of Appeals in resolving tax controversies without litigation. The designation of issues for litigation has been and remains infrequent. The IRS recently submitted its first TFA annual report indicating that no issues have been designated for litigation. For perspective, the Office of Chief Counsel annually litigates between 25,000 and 30,000 cases in the United States Tax Court, many of them involving small dollar amounts and pro se litigants. The process of designating an issue is exhaustive. It involves several written notices and opportunities for the taxpayer to avoid designation and is subject to the highest level of oversight within the IRS and Chief Counsel. It also includes the opportunity to personally meet with the Chief Counsel to make a case against designation. The TFA codifies this framework and high level of oversight. It also sets forth the specific elements for the written notice required to be provided to the taxpayer and grants taxpayers the right to administratively appeal designation determinations. The designation procedures set out in the memorandum will be incorporated into the Internal Revenue Manual, and corresponding changes will be made to the Chief Counsel Directive Manual. This ensures that IRS and Chief Counsel employees adhere to the designation procedures and comply with the TFA provisions. As part of the IRS's ongoing implementation of the TFA with public input, comments on today's release may be sent to tfao@irs.gov.

https://www.irs.gov/newsroom/irs-deadline-to-return-distributions-to-retirement-accounts-is-aug-31

IR-2020-187, August 24, 2020 WASHINGTON — The Internal Revenue Service today reminds IRA owners, beneficiaries or workplace retirement plan participants who received a Required Minimum Distribution (RMD) this year that they have until August 31 to rollover or repay the distribution to avoid paying taxes. The Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, waives RMDs during 2020 for IRAs and retirement plans, including for beneficiaries with inherited accounts. This waiver includes RMDs for individuals who turned age 70 ½ in 2019 and took their first RMD in 2020. Roth IRAs don't require withdrawals until after the death of the owner. Individuals who took RMDs in 2020, including those who turned 70 ½ during 2019, have the option of returning the distribution to their account or other qualified plan. Since the RMD rule is suspended, RMDs taken in 2020 are considered eligible for rollover. Therefore, RMDs can be rolled over to another IRA, another qualified retirement plan, or returned to the original plan by August 31, to avoid paying taxes on that distribution. IRS Notice 2020-51PDF also provides that the one rollover per 12-month period limitation and the restriction on rollovers to inherited IRAs don't apply to this repayment. The CARES Act provisions apply to most retirement plans, including traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, 457(b) plans, profit sharing plans and other defined contribution plans. The RMD suspension doesn't apply to qualified defined benefit plans. Where can I find more information? More information on the CARES Act and retirement plans, including FAQs, can be found on the Coronavirus-related relief for retirement plans and IRAs questions and answers page.

https://www.irs.gov/newsroom/irs-urges-employers-to-choose-carefully-when-selecting-a-payroll-service-provider

Using a reputable firm or group can protect employers from fraud; options include PSPs, RAs and CPEOs IR-2020-186, August 19, 2020 WASHINGTON — The IRS reminded employers today to carefully choose their payroll service providers following continuing concerns that some disreputable organizations can fail to deposit employment taxes, leaving businesses vulnerable to unpaid bills. Many employers outsource their payroll and related tax duties to third parties. This streamlines business operations by collecting and timely depositing payroll taxes on the employer's behalf and filing required payroll tax returns with state and federal authorities. "A business doing everything else right can suddenly find its future in doubt if it falls victim to an unscrupulous third party that fails to make the required payroll and withholding deposits," said IRS Commissioner Chuck Rettig. "We want to encourage all employers to understand their obligations and choose wisely when it comes to selecting a trusted payroll service to carry out this critical function. This is especially important right now as businesses face unique challenges because of the pandemic." Though most of these businesses provide quality service, there are, unfortunately, some who do not have their clients' best interests at heart. Each year, a few of these third parties fail to remit the payroll taxes entrusted to them and close their doors abruptly. The damage hits their unsuspecting clients hard. "Most third-party payroll services do a good job helping small businesses meet their deadlines and payroll obligations," said Eric Hylton, Commissioner, Small Business/Self Employed Division. "But each year some employers fall prey to unscrupulous third-parties that fail to send the IRS the taxes entrusted to them. We are vigilant in pursuing these third parties, but too often their clients – the employers − are left on the hook. The IRS wants all employers to take the necessary steps to protect themselves." Like employers who handle their own payroll duties, employers who outsource this function are in most instances still legally responsible for any and all payroll taxes due. This includes any federal income taxes withheld as well as both the employer and employee shares of Social Security and Medicare taxes. This is true even if the employer forwards tax amounts to the third party to make the required deposits or payments. One third-party arrangement that can reduce this risk is the certified professional employer organization (CPEO). Unlike other third parties, in most circumstances, the CPEO is solely liable for paying the customer's employment taxes, filing returns and making deposits and payments for the taxes reported with regard to wages and other compensation it pays to its employees. More information on CPEOs can be found on IRS.gov. Other third parties, such as payroll service providers (PSPs) and reporting agents (RAs) may also be right for many employers. A reporting agent is a PSP that has informed IRS of its relationship with its client (via Form 8655, Reporting Agent Authorization, which is signed by the client). A reporting agent is required to deposit its client's taxes via the Electronic Federal Tax Payment System and is authorized to exchange information with IRS on behalf of its client, such as to resolve an issue. For an overview of how the roles and obligations of PSPs, reporting agents and CPEOs differ from one to another, see the Third Party Arrangement Chart on IRS.gov. "Employers should remember to watch out and do due diligence to help safeguard themselves – and their employees − from a payroll service provider failing to do what the law requires," Rettig said. "IRS Criminal Investigation is committed to investigating all tax criminals, especially professionals who have fiduciary responsibilities and violate the trust of their clients," said Don Fort, Chief of IRS Criminal Investigation. "Those parties who do violate that trust may go to jail, but the defrauded employers' problems are just beginning. There is no substitute for continued diligence in ensuring something so important is done right. Your employees are counting on you." The IRS urges employers to take a number of steps to protect themselves from unscrupulous third parties. Enroll in the Electronic Federal Tax Payment System and make sure the PSP or Reporting Agent uses EFTPS to make tax deposits. Available free from the Treasury Department, EFTPS gives employers safe and easy online access to their payment history when deposits are made under their Employer Identification Number, enabling them to monitor whether their PSP or RA is properly carrying out its tax deposit responsibilities. It also gives them the option of making any missed deposits themselves, as well as paying other individual and business taxes electronically, either online or by phone. To enroll or for more information, call toll-free 800-555-4477 or visit www.eftps.gov.   Reporting Agents are required to deposit clients' taxes via EFTPS and, with limited exception, electronically file the tax returns. They are also required to provide clients a written statement reminding the employer that it, not the reporting agent, is ultimately responsible for the timely filing of returns and payment of taxes. This statement must be provided upon entering into a contract with the employer and at least quarterly after that. See Reporting Agents File on IRS.gov for more information.   Refrain from substituting the third party's address for the employer's address. Though employers are allowed to make or agree to such a change, the IRS recommends that an employer continue to use its own address as the address on record with the tax agency. Doing so ensures that the employer will continue to receive bills, notices, and other account-related correspondence from the IRS. It also gives employers a way to monitor the third party and easily spot any improper diversion of funds. Contact the IRS about any bills or notices and do so as soon as possible. This is especially important if it involves a payment that the employer believes was made or should have been made by a third party. Call the number on the bill, write to the IRS office that sent the bill, contact the IRS business tax hotline at 800-829-4933, or visit a local IRS office. See Notices for Past Due Tax Returns on IRS.gov for more information.

https://www.irs.gov/newsroom/irs-unemployment-compensation-is-taxable-have-tax-withheld-now-and-avoid-a-tax-time-surprise

IR-2020-185, August 18, 2020 WASHINGTON — With millions of Americans now receiving taxable unemployment compensation, many of them for the first time, the Internal Revenue Service today reminded people receiving unemployment compensation that they can have tax withheld from their benefits now to help avoid owing taxes on this income when they file their federal income tax return next year. By law, unemployment compensation is taxable and must be reported on a 2020 federal income tax return. Taxable benefits include any of the special unemployment compensation authorized under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted this spring. Withholding is voluntary. Federal law allows any recipient to choose to have a flat 10% withheld from their benefits to cover part or all of their tax liability. To do that, fill out Form W-4V, Voluntary Withholding RequestPDF, and give it to the agency paying the benefits. Don't send it to the IRS. If the payor has its own withholding request form, use it instead. If a recipient doesn't choose withholding, or if withholding is not enough, they can make quarterly estimated tax payments instead. The payment for the first two quarters of 2020 was due on July 15. Third and fourth quarter payments are due on September 15, 2020, and January 15, 2021, respectively. For more information, including some helpful worksheets, see Form 1040-ES and Publication 505, available on IRS.gov. Here are some types of payments taxpayers should check their withholding on: Benefits paid by a state or the District of Columbia from the Federal Unemployment Trust Fund Railroad unemployment compensation benefits Disability benefits paid as a substitute for unemployment compensation Trade readjustment allowances under the Trade Act of 1974 Unemployment assistance under the Disaster Relief and Emergency Assistance Act of 1974, and Unemployment assistance under the Airline Deregulation Act of 1978 Program Recipients who return to work before the end of the year can use the IRS Tax Withholding Estimator to make sure they are having enough tax taken out of their pay. Available only on IRS.gov, this online tool can help any worker or pension recipient avoid or lessen their year-end tax bill or estimate the refund they want. In January 2021, unemployment benefit recipients should receive a Form 1099-G, Certain Government PaymentsPDF from the agency paying the benefits. The form will show the amount of unemployment compensation they received during 2020 in Box 1, and any federal income tax withheld in Box 4. Taxpayers report this information, along with their W-2 income, on their 2020 federal tax return. For more information on unemployment, see Unemployment Benefits in Publication 525.

https://www.irs.gov/newsroom/working-virtually-make-a-plan-for-protecting-data-and-reporting-theft-part-5-of-security-summit-tips-for-tax-professionals

IR-2020-184, August 18, 2020 WASHINGTON — The Internal Revenue Service and Security Summit partners today reminded tax professionals that federal law requires them to have a written information security plan. Amid continuing security threats during COVID-19, the IRS, state tax administrators and the nation's tax industry − working together as the Security Summit − also recommended practitioners create an emergency response plan should they experience a data theft. Contacting the IRS is step one in the plan to quickly protect tax professionals and their clients. Making a plan for protecting data and reporting theft is the last of a five-part series called Working Virtually: Protecting Tax Data at Home and at Work. The special Security Summit initiative spotlights basic security steps for all practitioners, but especially those working remotely or social distancing in response to COVID-19. "COVID-19 has changed the way many of us work, and more tax professionals are working from home. With these changes, there are new risks from cybercriminals. Our special Security Summit series was designed to give you critical information protect your clients and protect your business," said IRS Commissioner Chuck Rettig. "We all have a role in protecting taxpayer data, and the tax professional community is a critical part of that effort," Rettig added. "It's more important than ever to take appropriate security precautions, protect remote work sites, use two-factor authentication and plan ahead for all possibilities." Tax Pros: Create a Security Plan to meet FTC requirement Federal law administered by the Federal Trade Commission requires all "professional tax preparers" to create and maintain a written information security plan that is appropriate to the firm's size and complexity. In addition, the FTC-required information security plan must be appropriate to the nature and scope of the company's activities and the sensitivity of the customer information it handles. A plan for a sole tax practitioner would differ from a multi-partner, global firm. Tax professionals working from home must ensure that client data is protected just as it would in an office setting. According to the FTC, each company, as part of its plan, must: designate one or more employees to coordinate its information security program; identify and assess the risks to customer information in each relevant area of the company's operation and evaluate the effectiveness of the current safeguards for controlling these risks; design and implement a safeguards program and regularly monitor and test it; select service providers that can maintain appropriate safeguards, make sure the contract requires them to maintain safeguards and oversee their handling of customer information; and evaluate and adjust the program in light of relevant circumstances, including changes in the firm's business or operations, or the results of security testing and monitoring.  Please note: The FTC currently is re-evaluating the Safeguards Rule and has proposed new regulations. Be alert to any changes in the Safeguards Rule and its effect on the tax preparation community. IRS Publication 4557, Safeguarding Taxpayer DataPDF, details critical security measures that all tax professionals should enact. The publication also includes information on how to comply with the FTC Safeguards Rule, including a checklist of items for a prospective data security plan. Tax professionals are asked to focus on key areas such as employee management and training; information systems; and detecting and managing system failures. The IRS also may treat a violation of the FTC Safeguards Rule as a violation of IRS Revenue Procedure 2007-40, which sets the rules for tax professionals participating as an Authorized IRS e-file Provider. Create a Data Theft Response Plan; Report Data Thefts to the IRS Tax professionals who experience a data theft should report the crime to the IRS immediately so that actions can be taken to protect taxpayers – and the firm. The Security Summit partners recommend practitioners create a response plan so that actions can be taken quickly, and contact information is readily available. If a client or the firm are the victim of data theft, immediately: Report it to the local IRS Stakeholder Liaison. Stakeholder Liaisons will notify IRS Criminal Investigation and others within the agency. Speed is critical. If reported quickly, the IRS can take steps to block fraudulent returns in clients' names and will assist through the process. Email the Federation of Tax Administrators at statealert@taxadmin.org. Get information on how to report victim information to the states. Most states require that the state attorney general be notified of data breaches. This notification process may involve multiple offices. Find more information at Data Theft Information for Tax Professionals. In addition to trying to steal client data, thieves may try to steal a tax practitioner's identity as well, using their PTINs, EFINs and CAF numbers to file fraudulent returns or steal even more information. Thieves may even try to impersonate the tax practitioner to obtain tax transcripts or other tax records. Practitioners should routinely check their IRS e-Services e-file Application to see a weekly count of tax returns filed with their Electronic Filing Identification Numbers or EFIN. Excessive filings are a sign of data theft. E-file applications also should be kept up to date. Circular 230 practitioners also can review weekly the number of tax returns filed using their Preparer Tax Identification Number or PTIN. Again, excessive filings are a sign of data theft. Preparers with Centralized Authorization File, or CAF numbers, that enable third party access to tax information or representation should keep those records updated. Practitioners should notify the IRS when they no longer need third-party authorization for clients. Additional resources Tax professionals also can get help with security recommendations by reviewing the recently revised IRS Publication 4557, Safeguarding Taxpayer DataPDF, and Small Business Information Security: The FundamentalsPDF by the National Institute of Standards and Technology. Publication 5293, Data Security Resource Guide for Tax ProfessionalsPDF, provides a compilation data theft information available on IRS.gov. Also, tax professionals should stay connected to the IRS through subscriptions to e-News for Tax Professionals and Social Media or visit Identity Theft Central at IRS.gov/identitytheft.

https://www.irs.gov/newsroom/13-point-9-million-americans-to-receive-irs-tax-refund-interest-taxable-payments-to-average-18-dollars

IR-2020-183, August 18, 2020 WASHINGTON — This week the Treasury Department and the Internal Revenue Service will send interest payments to about 13.9 million individual taxpayers who timely filed their 2019 federal income tax returns and are receiving refunds. The interest payments, averaging about $18, will be made to individual taxpayers who filed a 2019 return by this year's July 15 deadline and either received a refund in the past three months or will receive a refund. Most interest payments will be issued separately from tax refunds. In most cases, taxpayers who received their refund by direct deposit will have their interest payment direct deposited in the same account. About 12 million of these payments will be direct deposited. Everyone else will receive a check. A notation on the check − saying "INT Amount" − will identify it as a refund interest payment and indicate the interest amount. By law, these interest payments are taxable and taxpayers who receive them must report the interest on the 2020 federal income tax return they file next year. In January 2021, the IRS will send a Form 1099-INT to anyone who receives interest totaling at least $10. This provision is different from the long-standing 45-day rule, generally requiring the IRS to add interest to refunds on timely-filed refund claims issued more than 45 days after the return due date. Instead, this year's COVID-19-related July 15 due date is considered a disaster-related postponement of the filing deadline. Where a disaster-related postponement exists, the IRS is required, by law, to pay interest, calculated from the original April 15 filing deadline, as long as an individual files a 2019 federal income tax return by the postponed deadline − July 15, 2020, in this instance. This refund interest requirement only applies to individual income tax filers − businesses are not eligible. Interest is paid at the legally prescribed rate that is adjusted quarterly. The rate for the second quarter ending June 30 was 5%, compounded daily. Effective July 1, the rate for the third quarter dropped to 3%, compounded daily. Where the calculation period spans quarters, a blended rate applies, consisting of the number of days falling in each calendar quarter. No interest will be added to any refund issued before the original April 15 deadline. For more information, visit IRS.gov.

https://www.irs.gov/newsroom/now-available-irs-form-1040-x-electronic-filing

Major IRS milestone helps taxpayers correct tax returns with fewer errors, speeds processing IR-2020-182, August 17, 2020 WASHINGTON — Marking a major milestone in tax administration, the Internal Revenue Service announced today that taxpayers can now submit Form 1040-X electronically with commercial tax-filing software. As IRS e-filing has grown during the past 30 years, the 1040-X, Amended U.S. Individual Income Tax Return, has been one of the last major individual tax forms that needed to be paper filed. Today's announcement follows years of effort by the IRS, and the enhancement allows taxpayers to quickly electronically correct previously filed tax returns while minimizing errors. "The ability to file the Form 1040-X electronically has been an important long-term goal of the IRS e-file initiative for many years," said Sunita Lough, IRS Deputy Commissioner for Services and Enforcement. "Given the details needed on the form, there have been numerous challenges to add this form to the e-file family. Our IT and business operation teams worked hard with the nation's tax industry to make this change possible. This is another success for IRS modernization efforts. The addition helps taxpayers have a quicker, easier way to file amended returns, and it streamlines work for the IRS and the entire tax community." Making the 1040-X an electronically filed form has been a goal for the tax software and tax professional industry for years. It's been a continuing recommendation from the Internal Revenue Service Advisory Council (IRSAC) and Electronic Tax Administration Advisory Committee (ETAAC). Currently, taxpayers must mail a completed Form 1040-X to the IRS for processing. The new electronic option allows the IRS to receive amended returns faster while minimizing errors normally associated with manually completing the form. Since the tax-filing software allows users to input their data in a question-answer format, it simplifies the process for them. It also makes it easier for IRS employees to answer taxpayer questions since the data is entered electronically and submitted to the agency almost simultaneously. "Adding the 1040-X to the e-filing portfolio provides a better experience for the taxpayer, all around. It makes submitting an amended return easier and it allows our employees to process it in a more efficient way," said Ken Corbin, the IRS Wage and Investment commissioner and head of the division responsible for processing these returns. For the initial phase, only tax year 2019 Forms 1040 and 1040-SR returns can be amended electronically. Additional improvements are planned for the future. About 3 million Forms 1040-X are filed by taxpayers each year. Taxpayers still have the option to submit a paper version of the Form 1040-X and should follow the instructions for preparing and submitting the paper form. Those filing their Form 1040-X electronically and on paper can use the Where's My Amended Return? online tool to check the status of their amended return.

https://www.irs.gov/newsroom/last-round-of-itins-will-expire-in-2020-irs-encourages-early-renewal-to-prevent-refund-delays

IRS YouTube Videos: Individual Taxpayer Identification Number (ITIN) – English | Spanish (obsolete) IR-2020-181, August 17, 2020 WASHINGTON — More than 1 million Individual Taxpayer Identification Numbers are set to expire at the end of 2020 as the Internal Revenue Service completes the expiration of ITINs assigned prior to 2013. The IRS continues to urge affected taxpayers to submit their renewal applications early to avoid refund delays next year. Under the Protecting Americans from Tax Hikes (PATH) Act, ITINs that have not been used on a federal tax return at least once in the last three consecutive years and those issued before 2013 will expire. This year ITINs with middle digits 88 will expire Dec. 31, 2020. Additionally, ITINs with middle digits 90, 91, 92, 94, 95, 96, 97, 98 or 99, that were assigned before 2013 and have not already been renewed, will also expire at the end of the year. ITINs are used by people who have tax filing or payment obligations under U.S. law but who are not eligible for a Social Security number. ITIN holders who have questions should visit the ITIN information page on IRS.gov and take a few minutes to understand the guidelines. The IRS continues a nationwide education effort to share information with ITIN holders. To help taxpayers, the IRS offers a variety of informational materials PDF, including flyers and fact sheets, available in up to seven languages, including English, Spanish, Chinese, Russian, Vietnamese, Korean and Haitian-Creole on IRS.gov. Who should renew an ITIN Taxpayers whose ITIN is expiring and who expect to have a filing requirement in 2021 must submit a renewal application. Others do not need to take any action. ITINs with the middle digits 88 (For example: 9NN-88-NNNN) or 90, 91, 92, 94, 95, 96, 97, 98 or 99 (that meet the criteria above) need to be renewed even if the taxpayer has used it in the last three years. The IRS will begin sending the CP-48 Notice, You must renew your Individual Taxpayer Identification Number (ITIN) to file your U.S. tax return, to affected taxpayers in late summer. The notice explains that taxpayers will need to take action to renew the ITIN if it will be included on a U.S. tax return filed in 2021. Taxpayers who receive the notice after acting to renew their ITIN do not need to take further action unless another family member is affected.   As a reminder, ITINs with middle digits 83 through 87 expired last year. Middle digits 73 through 77, 81 and 82 expired in 2018. Middle digits 70, 71, 72, and 80 expired in 2017, and 78 and 79 expired in 2016. Taxpayers with these ITIN numbers who expect to have a filing requirement in 2021 can renew at any time. Family option remains available Taxpayers with an expiring ITIN have the option to renew ITINs for their entire family at the same time. Those who have received a renewal letter from the IRS can choose to renew the family's ITINs together, even if family members have an ITIN with middle digits that have not been identified for expiration. Family members include the tax filer, spouse and any dependents claimed on the tax return. How to renew an ITIN To renew an ITIN, a taxpayer must complete a Form W-7 and submit all required documentation. Taxpayers submitting a Form W-7 to renew their ITIN are not required to attach a federal tax return. However, taxpayers must still note a reason for needing an ITIN on the Form W-7. See the Form W-7 instructions for detailed information. Spouses and dependents only need to renew their ITIN if filing an individual tax return, or if they qualify for an allowable tax benefit (e.g., a dependent parent who qualifies the primary taxpayer to claim head of household filing status). In these instances, a federal return must be attached to the Form W-7 renewal application. There are three ways to submit the Form W-7 application package. Taxpayers can: Mail the form, along with original identification documents or copies certified by the agency that issued them, to the IRS address listed on the Form W-7 instructionsPDF. The IRS will review the identification documents and return them within 60 days.   Work with Certified Acceptance Agents (CAAs) authorized by the IRS to help taxpayers apply for an ITIN. CAAs can authenticate all identification documents for primary and secondary taxpayers, verify that an ITIN application is correct before submitting it to the IRS for processing and authenticate the passports and birth certificates for dependents. This saves taxpayers from mailing original documents to the IRS.   In advance, call and make an appointment at a designated IRS Taxpayer Assistance Center to have each applicant's identity authenticated in person instead of mailing original identification documents to the IRS. Each family member applying for an ITIN or renewal must be present at the appointment and must have a completed Form W-7 and required identification documents. See the TAC ITIN authentication page for more details. Avoid common errors now and prevent delays next year Federal tax returns that are submitted in 2021 with an expired ITIN will be processed. However, certain tax credits and any exemptions will be disallowed. Taxpayers will receive a notice in the mail advising them of the change to their tax return and their need to renew their ITIN. Once the ITIN is renewed, applicable credits and exemptions will be restored, and any refunds will be issued. Additionally, several common errors can slow down some ITIN renewal applications. These mistakes generally center on: mailing identification documentation without a Form W-7, missing information on the Form W-7, or insufficient supporting documentation, such as U.S. residency documentation or official documentation to support name changes. The IRS urges any applicant to check over their form carefully before sending it to the IRS. As a reminder, the IRS no longer accepts passports that do not have a date of entry into the U.S. as a stand-alone identification document for dependents other than U.S. military personnel overseas. The dependent's passport must have a date of entry stamp, otherwise the following additional documents to prove U.S. residency are required: U.S. medical records for dependents under age 6, U.S. school records for dependents under age 18, and U.S. school records (if a student), rental statements, bank statements or utility bills listing the applicant's name and U.S. address, if over age 18. To expand ITIN services, the IRS encourages individuals to apply for the Acceptance Agent Program To increase the availability of ITIN services nationwide, particularly in communities with high ITIN usage, the IRS continues to actively recruit Certifying Acceptance Agents and accepting applications year-round. Interested individuals are encouraged to review all CAA program changes and requirements and submit an application to become a CAA. For more information, visit the ITIN information page on IRS.gov.

https://www.irs.gov/newsroom/irs-takes-new-steps-to-ensure-people-with-children-receive-500-economic-impact-payments

IR-2020-180, August 14, 2020 WASHINGTON — The Internal Revenue Service continues to look for ways to help people who were unable to provide their information in time to receive Economic Impact Payments for their children. As part of that effort, the Internal Revenue Service announced today it will reopen the registration period for federal beneficiaries who didn't receive $500 per child payments earlier this year. The IRS urges certain federal benefit recipients to use the IRS.gov Non-Filers tool starting August 15 through September 30 to enter information on their qualifying children to receive the supplemental $500 payments. Those eligible to provide this information include people with qualifying children who receive Social Security retirement, survivor or disability benefits, Supplemental Security Income (SSI), Railroad Retirement benefits and Veterans Affairs Compensation and Pension (C&P) benefits and did not file a tax return in 2018 or 2019. The IRS anticipates the catch-up payments, equal to $500 per eligible child, will be issued by mid-October. "IRS employees have been working non-stop to deliver more than 160 million Economic Impact Payments in record time. We have coordinated outreach efforts with thousands of community-based organizations and have provided materials in more than two dozen languages," said IRS Commissioner Chuck Rettig. "Given the extremely high demand for EIP assistance, we have continued to prioritize and increase resource allocations to eligible individuals, including those who may be waiting on some portion of their payment. To help with this, we are allocating additional IRS resources to ensure eligible recipients receive their full payments during this challenging time." Used the Non-Filers tool after May 5? No action needed. For those Social Security, SSI, Department of Veterans Affairs and Railroad Retirement Board beneficiaries who have already used the Non-Filers tool to provide information on children, no further action is needed. The IRS will automatically make a payment in October. Didn't use the IRS Non-Filers tool yet? Provide information by September 30. For those who received Social Security, SSI, RRB or VA benefits and have not used the Non-Filers tool to provide information on their child, they should register online by Sept. 30 using the Non-Filers: Enter Payment Info Here tool, available exclusively on IRS.gov. Remember, anyone who filed or plans to file either a 2018 or 2019 tax return should file the tax return and not use this tool. For those unable to access the Non-Filers tool, they may submit a simplified paper return following the procedures described in this FAQ on IRS.gov. Any beneficiary who misses the September 30 deadline will need to wait until next year and claim it as a credit on their 2020 federal income tax return. Those who received their original Economic Impact Payment by direct deposit will also have any supplemental payment direct deposited to the same account. Others will receive a check. Eligible recipients can check the status of their payments using the Get My Payment tool on IRS.gov. In addition, a notice verifying the $500-per-child supplemental payment will be sent to each recipient and should be retained with other tax records. Other Non-Filers can still get a payment; must act by October 15. Though most Americans have already received their Economic Impact Payments, the IRS reminds people with little or no income and who are not required to file tax returns that they remain eligible to receive an Economic Impact Payment. People in this group should also use the Non-Filers' tool – but they need to act by October 15 to receive their payment this year. Anyone who misses the October 15 deadline will need to wait until next year and claim it as a credit on their 2020 federal income tax return. Available in both English and Spanish, the Non-Filers tool is designed for people with incomes typically below $24,400 for married couples, and $12,200 for singles. This includes couples and individuals who are experiencing homelessness. People can qualify, even if they don't work or have no earned income. But low- and moderate-income workers and working families eligible to receive special tax benefits, such as the Earned Income Tax Credit or Child Tax Credit, cannot use this tool. They will need to file a regular return by using IRS Free File or by another method. Other important notices involving Economic Impact Payments: Spouse's past-due child support. The IRS is actively working to resolve cases where a portion or all of an individual's payment was taken and applied to their spouse's past-due child support. People in this situation do not need to take any action. The IRS will automatically issue the portion of the EIP that was applied to the other spouse's debt. Spouses of deceased taxpayers. Upon enactment of the CARES Act, the IRS initially implemented the legislation consistent with processes and procedures relating to the 2008 stimulus payments (which were transmitted to deceased individuals). After further review this spring, Treasury determined that those who died before receipt of the EIP should not receive the advance payment. As a result, the EIP procedures were modified to prevent future payments to deceased individuals. The cancellation of uncashed checks is part of this process. Some EIPs to spouses of deceased taxpayers were cancelled. The IRS is actively working on a systemic solution to reissue payments to surviving spouses of deceased taxpayers who were unable to deposit the initial EIPs paid to the deceased and surviving spouse. For EIPs that have been cancelled or returned, the surviving spouse will automatically receive their share of the EIP. The IRS has taken steps to get payments to as many eligible individuals as possible. A recent oversight report confirmed that the IRS correctly computed the amount due for 98% of the payments issued. However, the IRS acknowledges the significance for those who have not yet received their full payment. The IRS continues to look at ways to help people get the right amount of the payment and will continue to provide updates on additional enhancements as they occur. For more Information on the Economic Impact Payment, including updated answers to frequently-asked questions and other resources, visit IRS.gov/coronavirus. These online resources are helpful for people who might not understand (i) why the payment received is less than $1,200, (ii) that they are ineligible to receive a payment, or (iii) why they may not be eligible to receive the $500 per qualifying child payment.

https://www.irs.gov/newsroom/irs-reminds-truckers-of-aug-31-highway-use-tax-return-deadline-e-file-encouraged

IR-2020-179, August 13, 2020 WASHINGTON — The Internal Revenue Service today reminded owners of most heavy highway vehicles of their responsibility to timely file Form 2290, Heavy Highway Vehicle Use Tax Return. The highway use tax applies to highway motor vehicles with a taxable gross weight of 55,000 pounds or more. This generally includes large trucks, truck tractors and buses. The tax is based on the weight of the vehicle. A variety of special rules apply. These special rules are explained in the instructions to Form 2290. The deadline to file Form 2290 and pay the tax is August 31, 2020, for vehicles used on the road during July. New feature For owners who are unsure if they have a requirement to file this form, IRS offers a new online feature called Do I Need to Pay the Heavy Highway Vehicle Use Tax? This question and answer format will help owners determine if they are required to pay highway use tax. IRS e-file for convenience, fast Schedule 1 The IRS encourages all owners to take advantage of the speed and convenience of e-file and paying any tax due electronically. Some taxpayers have the option of filing Form 2290 on paper, but for those with 25 or more taxed vehicles they must e-file Form 2290. There is no need to visit an IRS office because the form can be e-filed, and any required tax payment can be made online. Visit IRS.gov for a list of IRS-approved e-file providers and to find an approved provider for Form 2290 on the 2290 e-file partners page. Payment methods There are two ways to pay the tax electronically: Electronic funds withdrawal; authorize a direct debit as part of the e-file process. Electronic Federal Tax Payment System; allow five to seven business days for new accounts. Until further notice, paying the Heavy Highway Vehicle Use Tax by credit card or debit card is no longer available. To pay the tax by mail, send a completed Form 2290 and check or money order with Form 2290-V, Payment Voucher, to: Internal Revenue Service P.O. Box 932500 Louisville, KY 40293-2500 Generally, e-filers receive their IRS-stamped Schedule 1 electronically minutes after filing and paying any Heavy Highway Vehicle Use Tax due online. They can then print the Schedule 1 and provide it to their state department of motor vehicles without visiting an IRS office. In 2019, the IRS received approximately 941,000 Heavy Highway Vehicle Use Tax Returns. For more information about the highway use tax, visit the Trucking Tax Center at IRS.gov/trucker.

https://www.irs.gov/newsroom/working-virtually-avoid-phishing-scams-part-4-of-security-summit-tips-for-tax-professionals

IR-2020-178, August 11, 2020 WASHINGTON — The Internal Revenue Service and the Security Summit partners today warned tax professionals to be alert to new phishing scams that try to take advantage of COVID-19, Economic Impact Payments and increased teleworking by practitioners. The IRS, state tax agencies and the nation's tax industry urged tax firms to review and heighten their data protection plans this summer as cybercriminals step up efforts to steal client tax information. Crooks are targeting tax professionals as well as taxpayers. Avoiding phishing emails is the fourth in a five-part Security Summit series called Working Virtually: Protecting Tax Data at Home and at Work. The Security Summit initiative by the IRS, state tax agencies and private-sector tax industry spotlights basic security steps for all practitioners, but especially those working remotely in response to COVID-19. "The coronavirus has created new opportunities for cybercriminals to use email to try stealing sensitive information," said IRS Commissioner Chuck Rettig. "The vast majority of data thefts start with a phishing email trick. Identity thieves pose as trusted sources – a client, your software provider or even the IRS – to lure you into clicking on a link or attachment. Remember, don't take the bait. Learn to recognize and avoid phishing scams." Phishing emails generally have an urgent message, such as your account password expired. They direct you to an official-looking link or attachment. The link may take you to a fake site made to appear like a trusted source and request your username and password. Or, the attachment may contain malware, which secretly downloads malware that tracks keystrokes and allows thieves to eventually steal all the tax pro's passwords. This year, IRS identified a highly sophisticated attack against tax firms where thieves gained remote access either through phishing or malware and were able to enter the cloud storage accounts that held client files. In one case, thieves spent 18 months quietly downloading and accessing taxpayer information before they were discovered. The Department of Homeland Security's Cybersecurity and Infrastructure Security Agency (CISA) recently issued a warning to all organizations to educate employees, especially those teleworking, about increased activity related to phishing scams. These scams focused on COVID-19 fears by presenting themselves as providers of face masks or personally protective equipment in short supply. Thieves also used other tactics against taxpayers, impersonating the IRS and calling or emailing requests for bank account information to send the Economic Impact Payments. Tax professionals should beware of emails from criminals posing as potential clients. As people practice social distancing these days, criminals may exploit this process to try to trick tax practitioners into opening links or attachments. The Security Summit continues to urge tax professionals to create "trusted customer" policies, and contact potential clients by phone or video conference. Taxpayers and tax preparers can forward suspicious emails posing as the IRS to phishing@irs.gov. Because phishing emails are so common and successful, Summit partners urge tax professionals to educate all office personnel about the dangers and risks of opening suspicious emails – especially during the COVID-19 period. Additional resources Tax professionals also can get help with security recommendations by reviewing the recently revised IRS Publication 4557, Safeguarding Taxpayer DataPDF, and Small Business Information Security: The FundamentalsPDF by the National Institute of Standards and Technology. Publication 5293, Data Security Resource Guide for Tax ProfessionalsPDF, provides a compilation of data theft information available on IRS.gov. Also, tax professionals should stay connected to the IRS through subscriptions to e-News for Tax Professionals and Social Media or visit Identity Theft Central at IRS.gov/identitytheft.

https://www.irs.gov/newsroom/joint-board-announces-temporary-waiver-of-physical-presence-education-requirement-for-enrolled-actuaries

IR-2020-177, August 10, 2020 WASHINGTON — The Joint Board for the Enrollment of Actuaries today provided enrolled actuaries with notice that it is waiving the physical presence requirement for continuing professional education (CPE) credit for any formal programs conducted from January 1, 2020, through December 31, 2022. The Joint Board made this decision due to the hardships that the COVID-19 pandemic has caused, particularly those involving traveling to and participating in gatherings requiring close contact with others. This waiver applies to all enrolled actuaries, whether they are in active or inactive status. Joint Board regulations require that no less than 1/3 of the total hours of continuing professional education credit required for an enrollment cycle must be obtained by participation in a formal program or programs. Without this waiver, an enrolled actuary earning credit hours for a formal program would have to participate in the program in the same physical location with at least two other participants engaged in substantive pension service. Enrolled actuaries are still required to earn the same number of credit hours under formal programs that would otherwise be required. Although the physical presence requirement is temporarily waived, the other requirements for a formal program continue to apply, including all requirements for a qualifying program under the Joint Board regulations, attendance by at least three participants engaged in substantive pension service, and an opportunity for participants to interact with the instructor during the program. In addition, the certificate of completion or instruction issued by a qualifying sponsor of the program must indicate that the program is a formal program.    The Joint Board is committed to protecting the health and welfare of enrolled actuaries and understands the challenges that this health pandemic creates. By waiving the physical location requirement while retaining all other steps to earn credit hours in formal programs, the Joint Board feels these measures serve to protect the well-being of enrolled actuaries by encouraging social distancing and reducing person-to-person contact without compromising the integrity of the CPE requirements. An active or inactive enrolled actuary who did not receive a waiver notice by email should contact the Joint Board at nhqjbea@irs.gov.

https://www.irs.gov/newsroom/working-virtually-use-a-virtual-private-network-to-secure-remote-locations-part-3-of-security-summit-tips-for-tax-professionals

IR-2020-176, August 4, 2020 WASHINGTON — As more tax professionals consider teleworking during COVID-19, the Internal Revenue Service and the Security Summit partners today urged practitioners to secure remote locations by using a virtual private network (VPN) to protect against cyber intruders. A VPN provides a secure, encrypted tunnel to transmit data between a remote user via the Internet and the company network. As teleworking or working from home continues during the coronavirus, VPNs are critical to protecting and securing internet connections. Using virtual private networks is the third in a five-part Security Summit series called Working Virtually: Protecting Tax Data at Home and at Work. The security awareness initiative by the IRS, state tax agencies and the private-sector tax industry – working together as the Security Summit – spotlights basic security steps for all practitioners, but especially those working remotely or social distancing in response to COVID-19. "For firms expanding telework options during this time, a virtual private network is a must have," said IRS Commissioner Chuck Rettig. "We continue to see tax pros fall victim to attacks every week. These networks are something you can't afford to go without. The risk is real. Taking steps now can protect your clients and protect your businesses." Failure to use VPNs risks remote takeovers by cyberthieves, giving criminals access to the tax professional's entire office network simply by accessing an employee's remote internet. Tax professionals should seek out cybersecurity experts if they can afford it. If not, practitioners can search for "Best VPNs" to find a legitimate vendor, or major technology sites often provide lists of top services. Remember, never click on a "pop-up" ad marketing security product. Those generally are scams. The Department of Homeland Security's Cybersecurity and Infrastructure Security Agency (CISA) also encourages organizations to use VPNs. CISA also offers this advice: Update VPNs, network infrastructure devices and devices being used to remote into work environments with the latest software patches and security configurations. Alert employees to an expected increase in phishing attempts. Ensure information technology security personnel are prepared to ramp up these remote access cybersecurity tasks: log review, attack detection, and incident response and recovery. Implement multi-factor authentication on all VPN connections to increase security. If multi-factor is not implemented, require teleworkers to use strong passwords Ensure IT security personnel test VPN limitations to prepare for mass usage and, if possible, implement modifications—such as rate limiting—to prioritize users that will require higher bandwidths. Additional resources Tax professionals also can get help with security recommendations by reviewing the recently revised IRS Publication 4557, Safeguarding Taxpayer DataPDF, and Small Business Information Security: The FundamentalsPDF by the National Institute of Standards and Technology. Publication 5293, Data Security Resource Guide for Tax ProfessionalsPDF, provides a compilation of data theft information available on IRS.gov. Also, tax professionals should stay connected to the IRS through subscriptions to e-News for Tax Professionals and Social Media or visit Identity Theft Central at IRS.gov/identitytheft.

https://www.irs.gov/newsroom/james-lee-selected-to-lead-irs-criminal-investigation

IR-2020-175, August 3, 2020 WASHINGTON — The Internal Revenue Service announced today that James Lee will become the new chief of IRS Criminal Investigation (CI) on October 1. Lee, currently CI's deputy chief and a 25-year veteran of the organization, will succeed current Chief Don Fort, who announced last month he will retire on September 30. "Jim brings a quarter-century of Criminal Investigation management and field experience into this key enforcement role," said IRS Commissioner Chuck Rettig. "Jim is highly respected throughout the IRS and will continue long-standing working relationships with the civil enforcement functions of the IRS as well as with the Department of Justice's Tax Division and tax prosecutors throughout the country. He understands the need to support compliant taxpayers by maintaining a strong, robust enforcement effort focused on those who are compliance challenged." As Chief, CI, Lee will lead the IRS's criminal enforcement efforts to investigate tax code violations and other related financial crimes such as money laundering, public corruption, cybercrimes, identity theft, narcotics and terrorist-financing. Prior to serving as Deputy Chief of CI, he served as the Director of Field Operations, Northern Area where he oversaw CI enforcement programs in the Boston, New Jersey, New York, Ohio and Philadelphia Field Offices. He also previously served in executive roles as the Director of Field Operations, Southern Area and the Director, Strategy. Lee began his IRS CI career in 1995 as a special agent in Detroit. He moved into the CI leadership ranks and has held positions of increasing responsibility throughout his career including Supervisory Special Agent in the New Orleans Field Office; Headquarters Senior Analyst in the International and Financial Crimes Sections; Assistant Special Agent in Charge within the Boston Field Office; and Special Agent in Charge of the New Orleans Field Office and later the Chicago Field Office. Lee has a Bachelor of Business Administration Degree with a concentration in Accounting from Tiffin University in Ohio. He will follow Fort into CI's top position. Fort, who was named CI Chief in June 2017 will retire after a long career, which began in 1991 as a special agent in CI's Baltimore District. "Don has been a remarkable leader and champion for IRS Criminal Investigation," Rettig said. "He has a distinguished career and the entire IRS leadership team appreciates everything he has done to uphold the law and support tax administration. We look forward to Don's remaining time at the IRS as well as Jim taking on a new role and building on the great tradition in CI."

https://www.irs.gov/newsroom/irs-issues-final-regulations-on-the-deduction-for-meals-and-entertainment

IR-2020-225, September 30, 2020 WASHINGTON — The Internal Revenue Service issued final regulations on the business expense deduction for meals and entertainment following changes made by the Tax Cuts and Jobs Act (TCJA). The 2017 TCJA generally eliminated the deduction for any expenses related to activities generally considered entertainment, amusement or recreation. However, taxpayers may still deduct business expenses related to food and beverages if certain requirements are met. These final regulations address the disallowance of the deduction for expenditures related to entertainment, amusement or recreation activities, including the applicability of certain exceptions to this disallowance. They also provide guidance to determine whether an activity is considered entertainment. The final regulations also address the limitation on the deduction of food and beverage expenses. Updates on the implementation of the TCJA can be found on the Tax Reform page of IRS.gov.

https://www.irs.gov/newsroom/redesigned-irsgov-page-helps-people-closing-a-business-page-features-steps-to-navigate-final-tax-actions

IR-2020-224, September 30, 2020 WASHINGTON – The Internal Revenue Service today launched a redesigned page on IRS.gov to help business owners navigate the federal tax steps when closing a business. During this difficult and challenging time, the IRS streamlined the "Closing a Business" page into simple steps, so business owners and self-employed individuals can quickly find the information they need. "The IRS realizes small businesses and self-employed individuals are facing challenges in their personal and business lives during these uncertain times," said Eric Hylton, Commissioner, Small Business/Self-Employed Division. "Closing a business is a difficult decision and we want to help ease the burden for people making this tough choice. We redesigned the closing a business page on IRS.gov to help businesses comply with final tax responsibilities." The information includes what forms to file and how to report revenue received in the final year of business and expenses incurred before closure. File a Final Return and Related Forms. The type of return to file depends on whether the business is a sole proprietorship, partnership or corporation. The page features a section for each business type. Business owners can click on the section that applies to them to get the returns and forms they need. Take Care of Employees. Business owners with one or more employees must make final federal tax deposits and report employment taxes. Pay the Taxes Owed. Even if the business closes now, tax payments may be due next filing season. Report Payments to Contract Workers. Businesses that pay contractors at least $600 for services (including parts and materials) during the calendar year in which they go out of business, must report those payments. Cancel EIN and Close IRS Business Account. The IRS cannot close out an account until the business has filed all necessary returns and paid all taxes owed. Keep Business Records. How long a business needs to keep records depends on what's recorded in each document. The page also has information to help business owners who are declaring bankruptcy, selling their business and terminating retirement plans. For easy access, they can reach the page at IRS.gov/closingabiz. More information How to close a sole proprietorship fact sheet  e-posterPDF (Spanish versionPDF) How to close a partnership fact sheet e-posterPDF (Spanish versionPDF) How to close a corporation fact sheet e-posterPDF (Spanish versionPDF)

https://www.irs.gov/newsroom/irs-provides-final-regulations-on-income-tax-withholding-on-certain-periodic-retirement-and-annuity-payments

IR-2020-223, September 28, 2020 WASHINGTON — The U.S. Department of the Treasury and the Internal Revenue Service today issued final regulations updating the federal income tax withholding rules for certain periodic retirement and annuity payments made after December 31, 2020. Prior to the Tax Cuts and Jobs Act (TCJA), if no withholding certificate was in effect for a taxpayer's periodic payments, the amount to be withheld from the payments was determined by treating the taxpayer as a married individual claiming three withholding exemptions. The TCJA amended this rule to provide that the rate of withholding on periodic payments when no withholding certificate is in effect (the default rate of withholding) would instead be determined under rules prescribed by the Secretary of the Treasury. The final regulation issued today provides guidance for 2021 and future calendar years. This guidance specifies that the Treasury Department and the IRS will provide the rules and procedures for determining the default rate of withholding on periodic payments in applicable forms, instructions, publications and other guidance. In July 2020, the IRS released a draft of a redesigned 2021 Form W-4P and instructions intended to align with the redesigned Form W-4, Employee's Withholding Certificate. The draft 2021 Form W-4P also proposed a new default rate of withholding on periodic payments that begin after Dec. 31, 2020. Based on comments received on the draft Form W-4P, regarding the time required by payors to implement the new form and a new default rate of withholding, the IRS will postpone issuance of the redesigned form. Instead, the 2021 Form W-4P will be similar to the 2020 Form W-4P. The IRS also intends to provide in the instructions to the 2021 Form W-4P and related publications that the default rate of withholding on periodic payments will continue to be determined by treating the taxpayer as a married individual claiming three withholding allowances. The Treasury and IRS will continue working closely with the tax community on the redesign of Form W‑4P, with the intention of making the withholding system more accurate and transparent for taxpayers. For more information about this and other TCJA provisions, visit IRS.gov/taxreform.

https://www.irs.gov/newsroom/irs-provides-tax-relief-for-victims-of-hurricane-sally-oct-15-deadline-other-dates-extended-to-jan-15

IR-2020-222, September 24, 2020 WASHINGTON — Victims of Hurricane Sally that began on September 14 now have until January 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 Baldwin, Escambia and Mobile counties in Alabama, 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 September 14, 2020. As a result, affected individuals and businesses will have until January 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 October 15, 2020, will now have until January 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 January 15, 2021, deadline also applies to quarterly estimated income tax payments due on September 15, 2020, and the quarterly payroll and excise tax returns normally due on November 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 November 16, 2020. Businesses with extensions also have the additional time including, among others, calendar-year corporations whose 2019 extensions run out on October 15, 2020. In addition, penalties on payroll and excise tax deposits due on or after September 14 and before September 29, will be abated as long as the deposits are made by September 29, 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 – 4563 − for Hurricane Sally in Alabama 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 Sally and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.