Inside This Issue

1. Tax pros: Protect Your Clients, Protect Yourself with “security six”
2. Business Tax Account: New fact sheet available
3. Teachers eligible to deduct up to $300 in classroom expenses for 2024
4. Child and Dependent Care tax credit helps offset summer day camp costs
5. Interest rates unchanged for fourth quarter
6. Technical Guidance

1.  Tax pros: Protect Your Clients, Protect Yourself with “security six”

In the seventh installment of the “Protect Your Clients; Protect Yourself” summer security series, the IRS and its Security Summit partners identify six practices tax professionals should follow to improve data security. The “security six” include anti-virus software, firewalls, multi-factor authentication, backup software, drive encryption and virtual private networks.

In the event of a security breach, tax professionals must:

• Share information with the appropriate state tax agency by visiting Report a Data Breach;
• Review and understand the FTC data breach response requirements as part of their overall information and data security plan; and
• Report the incident to their local IRS stakeholder liaison.

Visit the Data Theft information for tax professionals webpage to learn more.

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2.  Business Tax Account: New fact sheet available

Fact Sheet-2024-27 provides guidance on the Business Tax Account (BTA), an online self-service tool for business taxpayers that facilitates the viewing and payment of balances due. According to the IRS, more features are on the way for the BTA, which is now available in both English and Spanish and offers business taxpayers new options for payment processing.

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3.  Teachers eligible to deduct up to $300 in classroom expenses for 2024

The federal deduction for classroom expenses applies to educators again in 2024, the IRS announced this week. Federal law permits educators to deduct the cost, up to $300, of supplies and other classroom necessities that they buy themselves.

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4.  Child and Dependent Care tax credit helps offset summer day camp costs

The Child and Dependent Care tax credit may be applied to summer day camp expenses, according to the IRS. Publication 503, Child and Dependent Care Expenses, provides a detailed explanation of all the regulations, the requirements to apply for the credit and an exception for certain taxpayers who live apart from their spouse. 

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5.  Interest rates unchanged for fourth quarter

The IRS announced no change in interest rates for the fourth quarter of 2024, beginning Oct. 1. The rates for interest determined under Section 6621 of the code for the calendar quarter beginning October 1, 2024, will be 8 percent for overpayments (7 percent in the case of a corporation), 8 percent for underpayments, and 10 percent for large corporate underpayments. See Revenue Ruling 2024-18 for details.

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6.  Technical Guidance

The IRS released interim guidance for sponsors of 401(k) and other comparable retirement plans that match contributions based on qualifying student loan payments made by their employees. The 2022 regulation allows employers with a 401(k) plan, 403(b) plan, governmental 457(b) plan or SIMPLE IRA plan to offer matching contributions based on student loan payments, rather than based only on elective contributions to retirement plans, in plan years beginning after Dec. 31, 2023.

Notice 2024-62 sets forth updates on the corporate bond monthly yield curve, the corresponding spot segment rates for July 2024 used under section 417(e)(3)(D), the 24-month average segment rates applicable for August 2024, and the 30-year Treasury rates, as reflected by the application of section 430(h)(2)(C)(iv).

Notice-2024-63 provides guidance in the form of questions and answers with respect to section 110 of Division T of the Consolidated Appropriations Act, 2023, Pub. L. 117 328, 136 Stat. 4459 (2022), known as the SECURE 2.0 Act of 2022.