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, 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

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 residing outside of the U.S. 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:

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:

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:

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.

Rev. Rul. 2020-16 provides various prescribed rates for federal income tax purposes including the applicable federal interest rates, the adjusted applicable federal interest rates, the adjusted federal long-term rate, the adjusted federal long-term tax-exempt rate. These rates are determined as prescribed by § 1274.  

The rates are published monthly for purposes of sections 42, 382, 412, 642, 1288, 1274, 7520, 7872, and various other sections of the Internal Revenue Code. 

Rev. Rul. 2020-16 will be published in Internal Revenue Bulletin 2020-37 on Sept. 8, 2020.

Notice 2020-64 provides guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used under § 417(e)(3), and the 24-month average segment rates under § 430(h)(2) of the Internal Revenue Code. In addition, this notice provides guidance as to the interest rate on 30-year Treasury securities under § 417(e)(3)(A)(ii)(II) as in effect for plan years beginning before 2008 and the 30-year Treasury weighted average rate under § 431(c)(6)(E)(ii)(I), as reflected by the application of § 430(h)(2)(C)(iv).

Notice 2020-64 will be published in Internal Revenue Bulletin 2020-36 on Aug. 31, 2020

Revenue Procedure 2020-39 addresses normalization issues that have arisen or are anticipated in ratemaking proceedings due to the corporate tax rate decrease that was included in the Tax Cuts and Jobs Act, Pub. L. 115-97 (131 Stat 2054), enacted on December 22, 2017.

It will appear in IRB 2020-36 dated Aug. 31, 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 Aug. 15 through Sept. 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 Sept. 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 Sept. 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 Oct. 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 Oct. 15 to receive their payment this year.

Anyone who misses the Oct. 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.

GLOBAL DISRUPTION OF
THREE TERROR FINANCE CYBER-ENABLED CAMPAIGNS 

Largest Ever Seizure of Terrorist Organizations’ Cryptocurrency Accounts           

WASHINGTON – The Justice Department today announced the dismantling of three terrorist financing cyber-enabled campaigns, involving the al-Qassam Brigades, Hamas’s military wing, al-Qaeda, and Islamic State of Iraq and the Levant (ISIS).  This coordinated operation is detailed in three forfeiture complaints and a criminal complaint unsealed today in the District of Columbia.  These actions represent the government’s largest-ever seizure of cryptocurrency in the terrorism context.

These three terror finance campaigns all relied on sophisticated cyber-tools, including the solicitation of cryptocurrency donations from around the world.  The action demonstrates how different terrorist groups have similarly adapted their terror finance activities to the cyber age.  Each group used cryptocurrency and social media to garner attention and raise funds for their terror campaigns.  Pursuant to judicially-authorized warrants, U.S. authorities seized millions of dollars, over 300 cryptocurrency accounts, four websites, and four Facebook pages all related to the criminal enterprise.

Funds successfully forfeited with a connection to a state sponsor of terrorism may in whole or in part be directed to the United States Victims of State Sponsored Terrorism Fund (http://www.usvsst.com/) after the conclusion of the case.

“It should not surprise anyone that our enemies use modern technology, social media platforms and cryptocurrency to facilitate their evil and violent agendas,” said Attorney General William P. Barr.   “The Department of Justice will employ all available resources to protect the lives and safety of the American public from terrorist groups.  We will prosecute their money laundering, terrorist financing and violent illegal activities wherever we find them.  And, as announced today, we will seize the funds and the instrumentalities that provide a lifeline for their operations whenever possible.  I want to thank the investigators from the Internal Revenue Service, Department of Homeland Security, Federal Bureau of Investigation, and the prosecutors from the D.C. United States Attorney’s Office and National Security Division for their hard and innovative work in attacking the networks that allow these terrorists to recruit for and fund their dangerous actions.”

"Terrorist networks have adapted to technology, conducting complex financial transactions in the digital world, including through cryptocurrencies. IRS-CI special agents in the DC cybercrimes unit work diligently to unravel these financial networks," said Secretary of the Treasury Steven T. Mnuchin.  "Today's actions demonstrate our ongoing commitment to holding malign actors accountable for their crimes.” 

“The Department of Homeland Security was born after the September 11, 2001 terrorist attacks and, nearly 20 years later, we remain steadfast in executing our critical mission to safeguard the American people, our homeland, and our values,” said Acting Secretary of Homeland Security Chad F. Wolf.  “Today’s announcement detailing these enforcement actions targeting foreign terrorist organizations is yet another example of the Department’s commitment to our mission. After launching investigations that identified suspected online payments being funneled to and in support of terrorist networks, Homeland Security Investigations skillfully leveraged their cyber, financial, and trade investigative expertise to disrupt and dismantle cyber-criminal networks that sought to fund acts of terrorism against the United States and our allies.  Together with our federal law enforcement partners, the Department will utilize every resource available to ensure that our Homeland is and remains secure.”   

“These important cases reflect the resolve of the D.C. United States Attorney’s Office to target and dismantle these sophisticated cyber-terrorism and money laundering actors across the globe,” stated Acting United States Attorney Michael R. Sherwin.  “While these individuals believe they operate anonymously in the digital space, we have the skill and resolve to find, fix and prosecute these actors under the full extent of the law.” 

“IRS-CI’s ability to trace funds used by terrorist groups to their source and dismantle these radical group’s communication and financial networks directly prevents them from wreaking havoc throughout the world,” said Don Fort, Chief, IRS Criminal Investigation.  “Today the world is a safer place.”

“As the primary law enforcement agency charged with defeating terrorism, the FBI will continue to combat illicit terrorist financing regardless of platform or method employed by our adversaries,” said FBI Director Christopher Wray. "As demonstrated by this recent operation, the FBI remains committed to cutting off the financial lifeblood of these organizations that seek to harm Americans at home and abroad."

“Homeland Security Investigations continues to demonstrate their investigative expertise with these enforcement actions,” said ICE Deputy Director and Senior Official Performing the Duties of the Director Matthew T. Albence.  “Together with law enforcement partners, HSI has utilized their unique authorities to bring to justice those cyber-criminal networks who would do us harm.”

Al-Qassam Brigades Campaign

The first action involves the al-Qassam Brigades and its online cryptocurrency fundraising efforts.  In the beginning of 2019, the al-Qassam Brigades posted a call on its social media page for bitcoin donations to fund its campaign of terror.  The al-Qassam Brigades then moved this request to its official websites, alqassam.net, alqassam.ps, and qassam.ps.

The al-Qassam Brigades boasted that bitcoin donations were untraceable and would be used for violent causes.  Their websites offered video instruction on how to anonymously make donations, in part by using unique bitcoin addresses generated for each individual donor.
            
However, such donations were not anonymous.  Working together, IRS, HSI, and FBI agents tracked and seized all 150 cryptocurrency accounts that laundered funds to and from the al-Qassam Brigades’ accounts.  Simultaneously, law enforcement executed criminal search warrants relating to United States-based subjects who donated to the terrorist campaign. 

With judicial authorization, law enforcement seized the infrastructure of the al-Qassam Brigades websites and subsequently covertly operated alqassam.net.   During that covert operation, the website received funds from persons seeking to provide material support to the terrorist organization, however, they instead donated the funds bitcoin wallets controlled by the United States.

The United States Attorney’s Office for the District of Columbia also unsealed criminal charges for two Turkish individuals, Mehmet Akti and Hüsamettin Karataş, who acted as related money launderers while operating an unlicensed money transmitting business.   

Al-Qaeda Campaign

The second cyber-enabled terror finance campaign involves a scheme by al-Qaeda and affiliated terrorist groups, largely based out of Syria.  As the forfeiture complaint details, these terrorist organizations operated a bitcoin money laundering network using Telegram channels and other social media platforms to solicit cryptocurrency donations to further their terrorist goals.  In some instances, they purported to act as charities when, in fact, they were openly and explicitly soliciting funds for violent terrorist attacks.  For example, one post from a charity sought donations to equip terrorists in Syria with weapons:

Undercover HSI agents communicated with the administrator of Reminder for Syria, a related charity that was seeking to finance terrorism via bitcoin donations.  The administrator stated that he hoped for the destruction of the United States, discussed the price for funding surface-to-air missles, and warned about possible criminal consequences from carrying out a jihad in the United States. 

Posts from another Syrian charity similarly explicitly referenced weapons and extremist activities:

Al-Qaeda and the affiliated terrorist groups together created these posts and used complicated obfuscation techniques, uncovered by law enforcement, to layer their transactions so to conceal their actions.  Today’s complaint seeks forfeiture of the 155 virtual currency assets tied to this terrorist campaign.   

ISIS Campaign

The final complaint combines the Department’s initiatives of combatting COVID-19 related fraud with combatting terrorism financing.  The complaint highlights a scheme by Murat Cakar, an ISIS facilitator who is responsible for managing select ISIS hacking operations, to sell fake personal protective equipment via FaceMaskCenter.com (displayed below)
 
The website claimed to sell FDA approved N95 respirator masks, when in fact the items were not FDA approved.  Site administrators claimed to have near unlimited supplies of the masks, in spite of such items being officially-designated as scarce.  The site administrators offered to sell these items to customers across the globe, including a customer in the United States who sought to purchase N95 masks and other protective equipment for hospitals, nursing homes, and fire departments.
 
The unsealed forfeiture complaint seized Cakar’s website as well as four related Facebook pages used to facilitate the scheme.  With this third action, the United States has averted the further victimization of those seeking COVID-19 protective gear, and disrupted the continued funding of ISIS. 

The claims made in these three complaints are only allegations and do not constitute a determination of liability.  The burden to prove forfeitability in a civil forfeiture proceeding is upon the government.  Further, charges contained in criminal complaint are merely allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

IRS-CI Cyber Crimes Unit (Washington, D.C.), HSI’s Philadelphia Office, and FBI’s Washington D.C., New York, and Los Angeles field offices are investigating the case. Assistant U.S Attorneys Jessi Camille Brooks and Zia M. Faruqui, and National Security Division Trial Attorneys Danielle Rosborough and Alexandra Hughes are litigating the case, with assistance from Paralegal Specialists Brian Rickers and Bria Cunningham, and Legal Assistant Jessica McCormick.  Additional assistance has been provided by Chainalysis and Excygent.

Notice 2020-60 provides procedures for the election of alternative minimum funding standards for defined benefit pension plans sponsored by community newspapers under § 430(m) of the Internal Revenue Code, which was added by § 115 of the SECURE Act. The draft notice also provides guidance and relief with respect to the election under § 430(m).

It will appear in IRB 2020-36 dated Aug. 31, 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 Aug. 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 partner’s page.

Payment methods

There are two ways to pay the tax electronically:

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.

Announcement 2020-14 provides that user fees relating to certain requests for letter rulings and determination letters submitted to Employee Plans Rulings and Agreements will increase in four categories, effective January 4, 2021.

Announcement 2020-14 will be in IRB: 2020-36, dated 08/31/2020.

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 Data (PDF), and Small Business Information Security: the Fundamentals (PDF) by the National Institute of Standards and Technology.

Publication 5293, Data Security Resource Guide for Tax Professionals (PDF), 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.