WASHINGTON — The Internal Revenue Service today announced the release of draft Form 6765, Credit for Increasing Research Activities, also known as the Research Credit. 

The IRS received helpful comments from various external stakeholders that have informed several revisions the IRS is making to reduce taxpayer burden. The feedback and changes will alleviate taxpayer burden, provide taxpayers with a consistent and predefined format and improve the information received for tax administration. 

The changes include: 

Optional reporting of Section G 

Section G, which was labeled “Section F” in the version of the form that IRS shared last fall, requests the Business Component Detail. The instructions will provide that Section G will be optional for: 

• Qualified Small Business (QSB) taxpayers, defined under section 41(h)(1) & (2) who check the box to claim a reduced payroll tax credit; or
• Taxpayers with total qualified research expenditures (QREs) equal to or less than $1.5 million, determined at the control group level, and equal to or less than $50 million of gross receipts, as determined under section 448(c)(3) (without regard to subparagraph (A) thereof), claiming a research credit on an original filed return. 

Reduced scope of Business Component Detail and other revisions 

In response to feedback from stakeholders, the IRS reduced the number of business components that must be reported on Section G. Taxpayers should report 80% of total QREs in descending order by the amount of total QREs per business component, but no more than 50 business components (with special instructions for taxpayers using the ASC 730 directive who can report ASC 730 QREs as a single line item on Section G). 

The amount of information that must be provided with respect to the reduced number of business components on Section G has also been reduced. For example, the IRS eliminated whether a business component is new/improved, a sale/license/lease and the narrative requirement (for original returns) that describes the information sought to be discovered. The selections for the type of business component are reduced, and the definitions for officers, controlled group reporting and business component descriptive names will be clarified in the instructions.  

The revised Section G will be optional for all filers for tax year 2024 (processing year 2025). This will allow taxpayers time to transition to the Section G format. Section G will be effective for tax year 2025 (processing year 2026), subject to the guidelines noted above.   

On Sept. 15, 2023, the IRS released a preview of proposed changes to Form 6765 and solicited comments from interested parties. The preview included a new Business Component Detail section for reporting quantitative and qualitative information for each business component, new questions seeking various information and reordering some of the existing questions on the form. The solicitation requested feedback on whether the new Business Component Detail section should be optional for certain taxpayers. 

Please see the final Form 6765. Instructions will be released at a later date.

FS-2024-21, June 17, 2024

WASHINGTON - The Department of the Treasury and the Internal Revenue Service today issued guidance on the inappropriate use of partnership rules to inflate the basis of the underlying assets without causing any meaningful change to the economics of their business.

The guidance issued today by Treasury and the IRS follows work by IRS exam teams, which have seen repeated instances of abusive basis-shifting taking place in sophisticated maneuvers by related-party partnerships.

As part of the larger IRS compliance efforts, the guidance issued today relates to certain partnership transactions that the IRS believes generate inappropriate tax benefits.

Generally, these transactions may employ several steps over a period of years and use sophisticated tax technology to ensure that little or no tax is paid while large amounts of tax basis is “stripped” from certain assets and shifted to other assets to generate tax benefits. In essence, these deals allow increased depreciation deductions or reduced gain on the sale of an asset with little or no substantive economic consequence.

These basis shifting transactions targeted in the new guidance generally fall into three groups:

Transfer of partnership interest to related party: In this transaction, a partner with a low share of the partnership’s “inside” tax basis and a high “outside” tax basis transfers the interest
in a tax-free transaction to a related person or to a person who is related to other partners in the partnership. This related-party transfer generates a tax-free basis increase to the transferee partner’s share of “inside” basis.

Distribution of property to a related party: In this transaction, a partnership with related partners distributes a high-basis asset to one of the related partners that has a low outside basis. After this, the distributee partner reduces the basis of the distributed asset and the partnership increases the basis of its remaining assets. The related partners can arrange this transaction so that the reduced tax basis of the distributed asset will not adversely impact the related partners, while the basis increase to the partnership’s retained assets can produce tax savings for the related parties.

Liquidation of related partnership or partner: In this transaction, a partnership with related partners liquidates and distributes (1) a low-basis asset that is subject to accelerated cost recovery or for which the parties intend to sell to a partner with a high outside basis and (2) a high-basis property that is subject to longer cost recovery (or no cost recovery at all) or for which the parties intend to hold to a partner with a low outside basis. Under the partnership liquidation rules, the first related partner increases the basis of the property with a shorter life or which is held for sale while the second related partner decreases the basis of the long-lived or non-depreciable property, with the result that the related parties generate or accelerate tax benefits.

To help address these areas, Notice 2024-54 announces two sets of upcoming regulations:

• The first set of regulations would require partnerships to treat basis adjustments arising from covered transactions in a way that would restrict them from deriving inappropriate tax benefits from the basis adjustments.
• The second set of regulations would provide rules to ensure clear reflection of the taxable income and tax liability of a consolidated group of corporations when members of the group own interests in partnerships. The notice further announces that that the covered transactions governed by these regulations would involve basis adjustments under Internal Revenue Code sections 732, 734(b) and/or 743(b).

Basis shifting identified as Transactions of Interest (TOI)
The proposed regulations Treasury and IRS issued today identify certain basis shifting transactions by partnerships as reportable Transactions of Interest (TOI).

“These proposed regulations will provide the IRS with information about potentially abusive partnership transactions involving basis shifting leading to significant tax benefits without causing any meaningful change to the economics of their business,” IRS Commissioner Danny Werfel said. “There are cases at either the litigation or the audit stage that involve transactions that are the same or similar to those described as transactions of interest in the proposed regulations issued today.”

The proposed regulations identify related-party partnership basis adjustment transactions and substantially similar transactions as a TOI – a type of reportable transaction. These proposed regulations would affect partnerships that are participating in the identified transactions by distributing partnership property or by transferring an interest in the partnership transferred in an identified transaction. The affected taxpayers and material advisors would be subject to the disclosure requirements for reportable transactions.

The TOIs generally involve positive basis adjustments of $5 million or more under subchapter K of the Internal Revenue Code – specifically sections 732(b) or (d), 734(b) or 743(b) – to which no corresponding tax is paid. The transactions would include either a distribution of partnership property to a partner that is related to one or more other partners in the partnership, or the transfer of a partnership interest in which the transferor is related to the transferee, or the transferee is related to one or more of the partners.

In these transactions, the basis increase allows related parties an opportunity for decreasing their taxable income through increased cost recovery deductions or through decreasing their taxable gain (or increasing their taxable loss) on the subsequent transfer of the property in a transaction in which gain or loss is recognized in whole or in part.

The proposed regulations would affect the partnership and the partners that are participating in the identified transactions, including by receiving a distribution of partnership property, transferring a partnership interest or receiving a partnership interest.

“You can see by these descriptions that these involve complex arrangements where taxable income can be shielded from scrutiny,” Werfel said. “These proposed regulations demonstrate the agency’s commitment to use new resources to unpack complicated noncompliance by partnerships and other high-income taxpayers, which is an important part of our efforts to bring more fairness to the tax system.”

Revenue Ruling informs the public that IRS will challenge basis stripping
Revenue Ruling 2024-14 notifies taxpayers and advisors using partnerships that engage in three variations of these transactions that the IRS will apply the codified economic substance doctrine to challenge inappropriate basis adjustments and other aspects of these transactions.

Under Revenue Ruling 2024-14, the IRS announces that the economic substance doctrine will be raised in cases where related parties:

1. create inside/outside basis disparities through various methods, including the use of certain partnership allocations and distributions,
2. capitalize on the disparity by either transferring a partnership interest in a nonrecognition transaction or making a current or liquidating distribution of partnership property to a partner, and
3. claim a basis adjustment under Internal Revenue Code sections 732(b), 734(b), or 743(b) resulting from the nonrecognition transaction or distribution.

New IRS teams being established; new guidance designed to stop partnerships from using sophisticated tax-free transactions that lack economic substance

IR-2024-166, June 17, 2024

WASHINGTON — As part of ongoing efforts to focus more attention on high-income compliance issues, the Internal Revenue Service announced today a new series of steps to combat abusive partnership transactions that allow wealthy taxpayers to avoid paying what they owe.

IRS compliance work continues to accelerate in this complex area of law following Inflation Reduction Act funding. As part of this, the agency is announcing a new dedicated group in the Office of Chief Counsel specifically focused on developing guidance on partnerships, including closing loopholes. The office will work closely with a new passthrough work group being established in the IRS Large and Business International division that will be formally established this fall.

The IRS and the Department of the Treasury today also issued three pieces of guidance focused on partnerships following discoveries by IRS audit teams. Currently, the IRS has tens of billions of dollars of deductions claimed in these transactions under audit.

The new guidance is designed to stop the use of “basis shifting” transactions that use related-party partnerships to avoid taxes. In these complex moves, high-income taxpayers and corporations strip basis from assets they own where the basis is not generating tax benefits and then move the basis to assets they own where it will generate tax benefits without causing any meaningful change to the economics of their businesses. These basis shifting transactions allow closely related parties to avoid taxes.

Treasury estimates these abusive transactions, which cut across a wide variety of industries and individuals, could potentially cost taxpayers more than $50 billion over a 10-year period.

“This announcement signals the IRS is accelerating our work in the partnership arena, which has been overlooked for more than a decade and allowed tax abuse to go on for far too long,” said IRS Commissioner Danny Werfel. “We are building teams and adding expertise inside the agency so we can reverse long-term compliance declines that have allowed high-income taxpayers and corporations to hide behind complexity to avoid paying taxes. Billions are at stake here.”

Using IRA funds, the IRS is increasing audits on complex partnerships, and the issues covered in this guidance will emerge as an important focus area.

The IRS is looking at these issues in current audits and will equip examiners to identify these issues on other partnership returns identified for examination as part of either the Large Partnership Compliance (LPC) program, partnership audit campaigns or other selection methods.

In addition, the new guidance provides greater clarity to taxpayers and examiners. And when final regulations are issued, the increased reporting requirements under the Transactions of Interest (TOI) announced today would give the IRS greater awareness of these arrangements, which are difficult to identify from the face of the tax return.

Werfel noted the guidance today is another sign that IRS compliance activity involving partnerships is accelerating and is needed given indications that marketing to promote basis-shifting transactions is increasing.

“In essence, basis shifting amounts to a shell game where sophisticated tax maneuvers take place by shifting the basis of assets between closely related entities, ultimately allowing these complex partnership arrangements to hide from a tax bill,” Werfel said. “These complicated maneuvers take time and resources for the IRS to uncover. The new guidance is aimed at telling promoters that the IRS considers these transactions inappropriate, and we are bringing new Inflation Reduction Act resources into play to beef up our compliance work in the overlooked partnerships and passthroughs area.”

Partnerships are part of a category of pass-through organizations under the federal tax code. Pass-throughs include entities such as partnerships and S-corporations. These groups are not subject to the corporate income tax; instead, income is "passed through" onto the income tax returns of the individual or corporate owners and taxed at their income tax rates. Partnerships and other pass-throughs are frequently used by higher-income groups and can be complex tax arrangements.

During the past decade, IRS budget cuts have made it harder for the agency to focus compliance resources on partnerships. Tax filings from passthrough businesses with more than $10 million in assets jumped to nearly 300,000 filings in 2019, 70% more than 2010. At the same time, audit rates fell from 3.8% in 2010 to 0.1% in 2019.

To counter these continuing compliance concerns, the IRS is using funding from the Inflation Reduction Act to strengthen enforcement among high-income taxpayers and corporations, with a special focus on partnerships. The IRS continues to work to add more top talent to help improve compliance work in this area.

The IRS has already announced a series of steps to improve compliance involving high-income individuals and partnerships, including launching audits on 76 of the largest partnerships with average assets over $10 billion that includes hedge funds, real estate investment partnerships, publicly traded partnerships, large law firms and many other industries. The IRS announced today that these complex audits are proceeding and in various stages of the process. These audits can take years depending on the size and complexity of the partnerships.

As part of the increased focus on this area, IRS Chief Counsel Margie Rollinson announced the creation of new Associate Office that will focus exclusively on partnerships, S-corporations, trusts and estates.

“This new Associate office will allow the Chief Counsel organization to focus more directly on this complex area of the tax law and allow more attention to legal guidance and other priorities in the partnership arena,” Rollinson said.

The Associate Office will be drawn from the current Passthroughs and Special Industries (PSI) Office. The “Special Industries” piece of Chief Counsel’s former PSI Office will form a new Associate office as well to focus on energy, credits and incentives and excise taxes, joining another office that has been focused on clean energy guidance.

The new Chief Counsel office will work in close coordination with IRS business units. This includes LBI, which earlier announced plans to establish a special work group focused on passthroughs, including complex partnerships. Although work has already started in this area, LBI plans to formally establish the new work group this fall.

Werfel noted that for the new workgroups in both Counsel and LBI, the IRS plans to bring in outside experts with private-sector experience regarding pass-throughs to work alongside the expert in-house knowledge of current IRS employees.

“This is an area where the IRS has not had the resources to keep pace with growth in the number of partnerships and the sophisticated tax maneuvers taking place,” Werfel said. “We are continuing to accelerate our work in this area. We need to hone-in on areas where we believe non-compliance has proliferated during the last decade of IRS budget cuts, and partnerships represent an area where complex business structures have allowed millionaires and high-income earners to avoid paying what they legally owe while average taxpayers play by the rules.”

Notice 2024-54 announces that the Department of the Treasury and the Internal Revenue Service intend to issue two sets of proposed regulations that would provide special rules for certain transactions under §§ 732, 734, 743, 755, and 1502 of the Internal Revenue Code.  First, proposed regulations under §§ 732, 734, 743, and 755 would provide special rules for the cost recovery of positive basis adjustments or the ability to take positive basis adjustments into account in computing gain or loss on the disposition of basis adjusted property following certain transactions.  Second, proposed regulations under § 1502 would provide rules to clearly reflect the taxable income and tax liability of a consolidated group whose members own interests in a partnership.

Notice 2024-54 will be published in Internal Revenue Bulletin 2024-28 on July 8, 2024

Revenue Ruling 2024-14 advises taxpayers of the Service’s position challenging certain partnership related-party transactions under the codified economic substance doctrine in § 7701(o).  Under the ruling, the Service applies the economic substance doctrine in three situations involving related parties where some or all of whom are partners in a partnership, and the parties: (1) create basis disparities through various methods; (2) capitalize on these basis disparities either by transferring a partnership interest in a nonrecognition transaction or by making a current or liquidating distribution of partnership property to a partner; and (3) claim a basis adjustment under §§ 732(b), 734(b), or 743(b).  The ruling holds that these transaction structures lack economic substance under § 7701(o).  In such cases, the Service will disregard the basis adjustments.

Revenue Ruling 2024-14 will be published in Internal Revenue Bulletin 2024-28 on July 8, 2024

Inside This Issue

1. 2024 Nationwide Tax Forum: Early-bird registration ends June 17
2. Reminder: Estimated taxes due on June 17
3. IRS reaches out to job seekers
4. Tax relief available for Kentucky, West Virginia disaster victims
5. Upcoming webinars for tax practitioners
6. News from the Justice Department's Tax Division
7. Technical Guidance

1.  2024 Nationwide Tax Forum: Early-bird registration ends June 17

The IRS encourages tax professionals to register for the 2024 IRS Nationwide Tax Forum by 5 p.m. ET on June 17 to take advantage of the early bird rate of $255 per person. A savings of $54 off the $309 standard rate and $135 off the on-site registration rate of $390. Standard pricing begins on June 17 after 5 p.m. ET and ends two weeks before the start of each forum.

The 2024 IRS Nationwide Tax Forum begins in Chicago, July 9-11, and continues on to Orlando, July 30-Aug. 1, Baltimore, Aug. 13-15, Dallas, Aug. 20-22, and concludes in San Diego, Sept. 10-12.

As the IRS’ marquis outreach event to the tax professional community, these 3-day conferences offer an opportunity for participants to learn from both IRS and industry experts, network with IRS officials and colleagues, and gain valuable insights into the tax industry.

This year’s list of seminars includes topics ranging from tax law updates to managing client examinations, from digital assets to the Secure Act 2.0, and from the employee retention credit to clean energy credits. For more information and to register, visit IRS Nationwide Tax Forum.

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2. Reminder: Estimated taxes due June 17

The IRS reminded taxpayers who do not have income subject to withholding that the deadline for paying estimated taxes for the second quarter is June 17. To prevent falling behind on their payments and possibly incurring underpayment penalties, the IRS encourage taxpayers who are paying estimated taxes to take this deadline into account. Additionally, taxpayers are reminded by the IRS that the third quarter payments are due Sept. 16, and the final estimated tax payment for tax year 2024 is due on Jan. 15, 2025.

Taxpayers can use a number of resources to find answers to common tax questions, including the Interactive Tax Assistant, Tax Topics and frequently asked questions.

 

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3. IRS reaches out to job seekers

The IRS announced the redesigned IRS Careers website is operational and prepared to match job seekers with IRS opportunities. As part of an ongoing hiring initiative enabled by Inflation Reduction Act funding, the IRS modernized its primary vehicle to publicize job opportunities and hire new talent.

The hiring site IRS.gov/jobs now provides a comprehensive landing spot for job seekers to find everything they need to pursue a career at the IRS, including:

• Upcoming hiring events;
• Key job descriptions;
• Overview of the IRS and employee benefits; and
• Special emphasis hiring paths (veterans, Schedule A Excepted Service Appointing Authority, students and other areas).

For tax professionals interested in a career at the IRS, the IRS is hosting an exclusive recruiting event at the Nationwide Tax Forum, being held in Chicago, Orlando, Baltimore, Dallas and San Diego. Tax Forum registrants will be sent more information leading up to each forum and recruiters will be there to share more information about job openings, salaries and benefits.

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4. Tax relief available for Kentucky, West Virginia disaster victims

Disaster-area taxpayers in parts of Kentucky and West Virginia affected by severe storms that began on April 2 have until Nov. 1 to file various federal individual and business tax returns and make payments. The IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA). The same relief will be available to any other counties added later to these disaster areas. The current list of eligible localities is available on the Tax relief in disaster situations page on IRS.gov.

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5. Upcoming webinars for tax practitioners

The IRS offers the upcoming live webinar to the tax practitioner community:

• Understanding Form 2290 - Heavy Highway Vehicle Use Tax on June 18, at 2 p.m. ET. Earn up to 2 CE credits (Federal tax).

For information or to register, visit www.webcaster4.com.

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6. News from the Justice Department’s Tax Division

The Justice Department filed a complaint seeking to bar Texas-area tax return preparer Ruben Gonzalez from preparing tax returns for others. By repeatedly understating customers’ tax liabilities, the complaint alleges that Gonzalez United States has been harmed by Gonzalez’s conduct, resulting in a significant loss in tax revenue of an estimated $20 million.

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7. Technical Guidance

Revenue Procedure 2024-26 updates existing procedures and provides additional procedures for qualified manufacturers to submit information regarding new clean vehicles to ensure the vehicles satisfy the requirements of section 30D(d) and (e) of the Internal Revenue Code (Code) for the applicable calendar year and therefore are eligible for the clean vehicle credit under section 30D.

Notice 2024-47 extends the relief provided in Notice 2024-33, which waived the estimated tax penalty imposed under section 6655 (for a corporation’s failure to pay estimated income tax) to the extent attributable to the revised corporate alternative minimum tax (CAMT) under section 55, but only with respect to an installment of estimated tax due on April 15, 2024, or May 15, 2024, with respect to a taxable year that began in 2024.

Notice 2024-47 extends the relief provided in Notice 2024-33, which waived the estimated tax penalty imposed under § 6655 (for a corporation’s failure to pay estimated income tax) to the extent attributable to the revised corporate alternative minimum tax (CAMT) under § 55, but only with respect to an installment of estimated tax due on April 15, 2024, or May 15, 2024, with respect to a taxable year that began in 2024. The relief from the addition to tax under § 6655 provided by Notice 2024-33 is extended to any installment of estimated tax by a corporate taxpayer with respect to a taxable year that began in 2024 that is due on or before August 15, 2024, to the extent attributable to the CAMT. 

Notice 2024-47 will be in IRB:  2024-27, dated 07/01/2024.

WASHINGTON — The Internal Revenue Service today announced the updated IRS Careers website is live and ready to connect job seekers with IRS opportunities. 

As part of an ongoing hiring campaign enabled by Inflation Reduction Act funding, the IRS modernized its primary vehicle to publicize job opportunities and hire new talent. 

“This is a historic period at the IRS as we work to transform the agency and improve our taxpayer service and compliance work,” said IRS Commissioner Danny Werfel. “A key part of our effort involves hiring, promoting and developing qualified employees in a wide variety of fields to help the IRS continue improvements and serve the nation. We’re looking for employees that want to serve taxpayers and the nation. To help attract qualified and diverse candidates across the country, the IRS is taking a variety of steps, including providing better tools and more ways for interested applicants to explore career opportunities with us.” 

After rigorous beta testing, the hiring site irs.gov/jobs now provides a comprehensive landing spot for job seekers to find everything they need to pursue a career at the IRS, including: 

• Upcoming hiring events. 
• Key job descriptions.
• Overview of the IRS and employee benefits.
• Special emphasis hiring paths (veterans, Schedule A Excepted Service Appointing Authority, students and other areas).  

The user-friendly site showcases the IRS commitment to service with a focus on potential employees that are interested in building careers with purpose. The IRS offers a positive work culture with an emphasis on work-life balance. 

The IRS plans to make additional improvements on the site in the future with additional features like career-mapping and a benefits calculator. 

People interested in the latest job openings and hiring events are encouraged to follow the IRS on LinkedIn and its recruitment handle on X (@RecruitmentIRS). 

For tax professionals interested in a career at the IRS, the IRS is hosting an exclusive recruiting event at the Nationwide Tax Forum, being held in Chicago, Orlando, Baltimore, Dallas and San Diego. Tax Forum registrants will be sent more information leading up to each forum and recruiters will be there to share more information about job openings, salaries and benefits.  

The IRS is also partnering with colleges and universities across the country to host students, faculty and recent graduates at special “IRS Tax Adventure” sessions. The program was created to connect students, faculty and recent graduates with IRS offices, hiring opportunities and events. Qualified students attending the Tax Adventure at the 2024 Tax Forums will have an opportunity to participate in an exclusive recruiting event. 

Why work for the IRS? 

Employment with the IRS provides employees an opportunity to serve their country. Careers at the IRS help ensure the tax system is administered with integrity and fairness. IRS employees help collect 96% of the nation's revenue needed to fund things like homeland security, national defense and Social Security, as well as parklands, roads, bridges, libraries and schools. 

Employee benefits include up to $5,000 annually for childcare and 12 weeks of paid parental leave, up to $60,000 in student loan repayment, up to $3,600 in mass transit commuting subsidies annually as well as generous healthcare and retirement benefits. Federal employees also participate in the Thrift Savings Plan, which includes up to 5% matching employer contributions for retirement. 

A career with the IRS comes with stability, a healthy work-life balance and workplace flexibilities. Employees benefit from flexible work schedules, an employee assistance program, health services and multiple leave options. 

The IRS also invests in the growth and development of its staff, providing both classroom and on-the-job training for various positions and potential to advance within the agency.

WASHINGTON — As part of continuing efforts to protect the senior community, the Internal Revenue Service today issued a warning about the rising threat of impersonation scams. 

These scams are targeting older adults by pretending to be government officials, aiming to steal sensitive personal information and money. By posing as representatives from agencies such as the IRS, or other government agencies, these fraudsters use fear and deceit to exploit their victims. 

“Scammers often target seniors, attempting to steal personal information through phone calls, emails or text messages by pretending to be from the IRS or other agencies or businesses,” said IRS Commissioner Danny Werfel. “Preventing these types of scams requires assistance from many different places. By partnering with other federal agencies and others in the tax community, we can reach more seniors and other taxpayers to help protect them against these terrible scams.” 

This is part of a wider effort taking place this week leading up to World Elder Abuse Awareness Day (WEAAD) on Saturday, June 15. WEAAD, observed since June 15, 2006, aims to foster a better understanding of the neglect and abuse faced by millions of older adults, focusing attention on the contributing cultural, social, economic and demographic factors. 

The IRS also has been engaged in long-term efforts to protect against scams and other related schemes, including identity theft. This has been an ongoing focus of the Security Summit partnership between the IRS, state tax agencies and the nation’s tax professional community since 2015. 

Understanding the threats

The IRS has identified a concerning trend where fraudulent actors are increasingly targeting unsuspecting individuals, particularly senior citizens, by masquerading as IRS agents. Victims are pressured into making immediate payments through unorthodox methods such as gift cards or wire transfers under the pretense of resolving fictitious tax liabilities or securing false refunds. 

These scammers deploy advanced techniques to fabricate a veneer of credibility, including the manipulation of caller IDs to appear legitimate. Here are just a few examples of their schemes: 

• Impersonation of known entities: Fraudsters often pose as representatives from government agencies — including the IRS, Social Security Administration and Medicare — others in the tax community or familiar businesses and charities. By spoofing caller IDs, scammers can deceive victims into believing they are receiving legitimate communications. 

• Claims of problems or prizes: Scammers frequently fabricate urgent scenarios, such as outstanding debts or promises of significant prize winnings. Victims may be falsely informed that they owe the IRS money, are owed a tax refund, need to verify accounts or must pay fees to claim non-existent lottery winnings. 

• Pressure for immediate action: These deceitful actors create a sense of urgency, demanding that victims take immediate action without allowing time for reflection. Common tactics include threats of arrest, deportation, license suspension or computer viruses to coerce quick compliance. 

• Specified payment methods: To complicate traceability, scammers insist on unconventional payment methods, including cryptocurrency, wire transfers, payment apps or gift cards, and often require victims to provide sensitive information like gift card numbers. 

Scam precautions and reporting

If an individual receives an unexpected call from someone alleging to be from the IRS, but they have not been notified by mail about any issues with their IRS account, they should hang up immediately. The call is likely from a scammer. 

Do not return the call using the number provided by the caller or the one displayed on their caller ID. If taxpayers are uncertain about the legitimacy of IRS communications, they can contact IRS customer service for verification at 800-829-1040, or for the hearing impaired, TTY/TDD 800-829-4059. 

To view details about an individual’s tax account, they can set up or check their IRS individual online account on IRS.gov. 

Electronic scams are also on the rise, with scammers sending malicious emails and texts posing as IRS representatives to steal personal information. The IRS reminds taxpayers that it does not initiate contact via email, text, or social media regarding tax bills or refunds. 

Report the call or electronic scam by visiting the Hotline page of the Treasury Inspector General for Tax Administration and using an IRS Impersonation Scam Reporting form or by calling 800-366-4484. Forms to report different types of fraud are available on the Hotline page of Treasury Inspector General for Tax Administration website. Taxpayers can click the appropriate option under "IRS Scams and Fraud" and follow the instructions. 

Key points to remember:

Individuals should understand how and when the IRS contacts taxpayers to help them verify whether any communication they receive is genuinely from an IRS employee. 

Most IRS communications are initiated through regular mail delivered by the United States Postal Service. However, in certain situations, the IRS may make phone calls or visit homes or businesses. These situations include having an overdue tax bill, an unfiled tax return or missing employment tax deposit. 

Additionally, an IRS employee might review assets or inspect a business as part of a collection investigation, audit or ongoing criminal investigation. 

Remember the following: 

• The IRS will never demand immediate payment via prepaid debit cards, gift cards or wire transfers. Typically, if taxes are owed, the IRS will send a bill by mail first. 

• The IRS will never threaten to involve local police or other law enforcement agencies. 

• The IRS will never demand payment without allowing opportunities to dispute or appeal the amount owed. 

• The IRS will never request credit, debit or gift card numbers over the phone. 

Remaining vigilant and informed about these scams can help protect taxpayers from financial loss and identity theft. The IRS and partnering federal agencies urge everyone to be cautious, especially when dealing with unsolicited communications concerning taxes. 

In March 2020, the U.S. Department of Justice introduced the National Elder Fraud Hotline to address fraud targeting elderly Americans and support affected individuals. If an individual has fallen victim to elder fraud, they can contact the National Elder Fraud Hotline at 833-FRAUD-11 (833-372-8311).

The hotline operates Monday through Friday, from 10 a.m. to 6 p.m. Eastern Time, and services are available in English, Spanish, and other languages. 

More information

• Tax Scams and Consumer Alerts
• Report Phishing and Online Scams
• The IRS Dirty Dozen: Annual list of scams affecting taxpayers
• Federal Trade Commission- How to avoid a government impersonation scam
• Security Summit partnership

 

WASHINGTON — The Internal Revenue Service today announced the continuing education agenda for the 2024 Nationwide Tax Forum featuring 45 seminars on a wide array of topics that will help tax professionals serve their clients.

This year’s agenda, featuring speakers from the IRS and leading tax associations, includes topics ranging from tax law updates to managing client examinations, from digital assets to the Secure Act 2.0, and from the Employee Retention Credit to clean energy credits.

In the keynote address and plenary session, IRS leadership will focus on the agency’s ongoing work to improve service and transform enforcement and compliance activities.

In addition to the regular tax law update and ethics courses, this year’s forum is hosting two panel discussions on cybersecurity: “Tax Pros and Security – Real-Life Threats and Steps to Protect Your Business” and “IRS Security Summit and the Written Information Security Plan.” In addition, experts from the Pell Center will present “Cybersecurity for Tax Professionals.”

The Nationwide Tax Forum will also equip tax pros to join in the fight against abusive scams, schemes and fraud with three seminars on the topic.

Six of this year’s most popular topics will be presented in both English and Spanish.

Altogether, attendees can earn up to 19 continuing education credits by attending one of the five forums in Chicago, Orlando, Baltimore, Dallas or San Diego.

In addition to the regular seminar lineup, attendees at the Nationwide Tax Forum can attend all of the following special events:

Practice Management / Prácticas de administración

Monday: English from 5-6:30 p.m.; Spanish from 7-8:30 p.m.

Looking for ways to grow or improve your tax business? Maximize your time at the forum by participating in this special Monday session. Tax forum association partners from the National Association of Enrolled Agents, National Association of Tax Professionals, National Society of Accountants, National Society of Tax Professionals and Padgett Business Services will present ideas on how you can attract and manage customers, increase your productivity and have a more satisfying work-life balance.

¿Busca formas de hacer crecer o mejorar su negocio de impuestos? Maximice su tiempo en el foro participando en esta sesión especial el lunes a las 5 p.m. (en inglés). A las 7 p.m. se llevará a cabo la sesión en español, con colaboradores de Advanced Accounting & Tax Services, American Tax Club, BMS of Arizona Corp., Freedom Tax Resolution, Latin Tax Academy, Latino Tax Professional, Midland LDU Insurance and Tax Services, National Association of Enrolled Agents, NAVA School of Business, Noba Digital Academy y Tax Solutions & Bookkeeping LLC.

Scams and Schemes Panel Discussion with CERCA

Wednesday: 12-1 p.m.

Have you been victimized by a tax scam? Scammers are targeting the tax pro community. Join CERCA’s members from the tax and software community and IRS leaders for a panel discussion that will equip tax professionals to protect themselves and their clients. 

National Taxpayer Advocate Town Hall

Wednesday: 4:30-5:30 p.m.

Join National Taxpayer Advocate Erin Collins during the Nationwide Tax Forum Networking Reception to discuss emerging issues facing taxpayers and tax professionals. She wants to hear from the tax professional community and welcomes tax pro participation in addressing these concerns. The program includes a Q&A session.

Beneficial Ownership Information Reporting

Wednesday: 5:45-6:45 p.m.

A new law affecting many small businesses – including many tax practices – went into effect in 2024 requiring companies to report ownership information to the Treasury Department’s Financial Crimes Enforcement Network (FinCEN). This bonus session, featuring representatives from FinCen and the IRS, will explain what tax professionals need to do to comply with the new reporting requirements.

The special events do not convey continuing education credit.

Early bird deadline approaching

Register by 5 p.m. ET on June 17 to take advantage of the early bird rate of $255 per person. That’s a savings of $54 off the $309 standard rate and $135 off the on-site registration rate of $390. Standard pricing begins on June 17 after 5 p.m. ET and ends two weeks before the start of each forum.

For more information and to register online, visit www.irstaxforum.com.

Association members save an additional $10

Members of the following participating associations can save an additional $10 off the early bird rate if they register by June 17. Those interested should contact their association directly for more information:

• American Bar Association (ABA)
• American Institute of Certified Public Accountants (AICPA)
• National Association of Enrolled Agents (NAEA)
• National Association of Tax Professionals (NATP)
• National Society of Accountants (NSA)
• National Society of Tax Professionals (NSTP)

Location	Forum Dates	Deadline for $309 Standard Rate
Chicago, IL	July 9-11	June 25
Orlando, FL	July 30-Aug. 1	July 16
Baltimore, MD	Aug. 13-15	July 30
Dallas, TX	Aug. 20-22	Aug. 6
San Diego, CA	Sept. 10-12	Aug. 27

The IRS provides continuing education credits to enrolled agents, certified public accountants, Annual Filing Season Program participants and California Tax Education Council participants.

To learn more about the IRS Nationwide Tax Forum, see these YouTube videos:

• 2024 IRS Nationwide Tax Forums: Transforming Tax Services for Professionals
• 5 Things to Know: With John Lipold and Patricia Young, Presented by Tax Talk Today

For more information and to register online, visit www.irstaxforum.com.