WASHINGTON - As part of the administration’s efforts to bring all available resources to bear to support state and local partners impacted by Hurricane Sandy, the IRS is postponing the filing date until Feb. 1, 2013, for some small tax-exempt organizations affected by Hurricane Sandy to take advantage of transitional relief when applying for reinstatement of their exempt status.

Organizations that did not file a required information return or electronic notice for their taxable years beginning in 2007, 2008 and 2009 automatically lost their tax-exempt status, and must apply if they want to be reinstated. In Notice 2011-43, the IRS provided transitional relief for certain small organizations that were not required to file annual information returns for taxable years beginning before 2007, were eligible in each of their taxable years beginning in 2007, 2008 and 2009 to file a Form 990-N e-Postcard, and applied for reinstatement of tax-exempt status on or before Dec. 31, 2012. These organizations may file an application for tax exemption and, if it is approved, will have their tax-exempt status reinstated retroactively to the date the status was revoked. In addition, these organizations pay a reduced application fee of $100.

To be eligible for the Feb. 1 deadline, described in Notice 2012-71, the organization’s principal place of business must be located in the covered disaster area, or records necessary to meet the application deadline must be maintained in the covered disaster area. If an eligible organization files its application for exemption on or before Feb. 1, 2013, it will be treated as if it had been timely filed on Dec. 31, 2012. Organizations located outside the affected areas must apply for transitional relief by Dec. 31, 2012. Organizations located outside of the affected area that think they may qualify for the relief described in Notice 2012-71 need to contact the IRS at 866-562-5227.

To take advantage of the extended transitional relief, an organization must apply for reinstatement by filing a Form 1023 or Form 1024, Application for Recognition of Exemption. In addition to the instructions in Notice 2011-43, the organization should write “Notice 2011-43” and “Sandy Relief” on the top of the application form and on the envelope. Organizations with questions about this relief should call the TE/GE Customer Account Services toll free number at (877) 829-5500.

For information on areas designated as covered disaster areas and tax relief for victims of Hurricane Sandy, visit Tax Relief in Disaster Situations.

To check for future announcements, visit Disaster Relief Resources for Charities and Contributors or Help for Victims of Hurricane Sandy.

Related Items:

• Form 1023 Form and Instructions
• Form 1024 Form and Instructions

IRS Charities and Nonprofits information

Are you a practitioner who still needs to take the Registered Tax Return Preparer Test? 
If your answer is "YES", then this FREE one-hour IRS Live webinar is for YOU…

Topic: Get Prepared: A to Z Details on the Registered Tax Return Preparer Test
Date: Wednesday, December 19, 2012
Time: 2:00 p.m. (Eastern)

What's Covered:
· Why the test is important
· Who must take the test
· Why the test should be taken soon
· How to schedule the test
· What study tools are available (Note: ASV is offering a one-day, live RTRP prep course on Dec. 17th)
· What to expect on test day
· What happens after you pass or fail
· Info about a new return preparer public listing
· How to decide between the RTRP test and the Special Enrollment Exam to become an Enrolled Agent

CPE: Certificate of Completion offered - Earn one CE credit - Category: Federal Tax Law

Click on the following link to register: http://www.visualwebcaster.com/IRS/89770/reg.asp?id=89770
Your participation in a brief survey after the webinar is greatly appreciated.

If you registered for the October 31st broadcast, you will need to re-register.

WASHINGTON undefined The Internal Revenue Service today issued the 2013 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.

Beginning on Jan. 1, 2013, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

• 56.5 cents per mile for business miles driven
• 24 cents per mile driven for medical or moving purposes
• 14 cents per mile driven in service of charitable organizations

The rate for business miles driven during 2013 increases 1 cent from the 2012 rate.  The medical and moving rate is also up 1 cent per mile from the 2012 rate.

The standard mileage rate for business is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System (MACRS) or after claiming a Section 179 deduction for that vehicle.  In addition, the business standard mileage rate cannot be used for more than four vehicles used simultaneously.

These and other requirements for a taxpayer to use a standard mileage rate to calculate the amount of a deductible business, moving, medical, or charitable expense are in Rev. Proc. 2010-51.  Notice 2012-72 contains the standard mileage rates, the amount a taxpayer must use in calculating reductions to basis for depreciation taken under the business standard mileage rate, and the maximum standard automobile cost that a taxpayer may use in computing the allowance under a fixed and variable rate plan.

It is time to renew your status as an enrolled agent. 

You must renew your status as an enrolled agent every three years in order to remain eligible to practice before the IRS. Because your social security number ends in 0, 1, 2, or 3, you must renew by January 31, 2013.

• Renew your license using Form 8554, Application for Renewal of Enrollment to Practice Before the IRS, at www.pay.gov/paygov between November 1, 2012 and January 31, 2013.
• Go to www.pay.gov/paygov and enter “8554” in the Search Public Forms box on the left-hand side.
• Complete the online form and pay the $30 renewal fee.
• Renewals may take up to 90 days to process.

All enrolled agents must also have a Preparer Tax Identification Number (PTIN) and you must enter it on Form 8554. 

All enrolled agents must obtain a PTIN and renew it each year per Treasury Department Circular 230 Section 10.6(d)(2)(i). If you do not already have a PTIN, you can obtain one online at www.irs.gov/ptin. When you apply, you’ll need to provide the following information:

• Your Social Security number and date of birth
• The address and filing status from your most recent Form 1040 income tax return
• Other identification numbers, such as an Employer Identification Number, CAF number, Electronic Filing Identification Number, CPA, bar, or enrolled agent license number
• Contact information, such as a permanent mailing address, physical business address, email address, and telephone number
• Credit or debit card number to pay the $64.25 user fee

You’ll also need to answer the following questions:

• Are you in compliance with your federal tax obligations?
• Have you been convicted of a felony in the past 10 years?

Additional information:

If you have questions about your enrolled agent renewal, please email your inquiry to EPP@irs.gov or call 313-234-1280 (Hours: 7:30 am – 4 pm (ET)). 

WASHINGTON – The Internal Revenue Service today issued a consumer alert about possible scams taking place in the wake of Hurricane Sandy.

Following major disasters, it’s common for scam artists to impersonate charities to get money or private information from well-intentioned taxpayers. Such fraudulent schemes may involve contact by telephone, social media, email or in-person solicitations.

The IRS cautions both hurricane victims and people wishing to make disaster-related charitable donations to avoid scam artists by following these tips:

• To help disaster victims, donate to recognized charities.  
• Be wary of charities with names that are similar to familiar or nationally known organizations. Some phony charities use names or websites that sound or look like those of respected, legitimate organizations. The IRS website at IRS.gov has a search feature, Exempt Organizations Select Check, which allows people to find legitimate, qualified charities to which donations may be tax-deductible. Legitimate charities may also be found on the Federal Emergency Management Agency (FEMA) Web site at fema.gov.
• Don’t give out personal financial information such as Social Security numbers or credit card and bank account numbers and passwords to anyone who solicits a contribution from you. Scam artists may use this information to steal your identity and money.
• Don’t give or send cash. For security and tax record purposes, contribute by check or credit card or another way that provides documentation of the gift.
• Call the IRS toll-free disaster assistance telephone number, 1-866-562-5227, if you are a hurricane victim with specific questions about tax relief or disaster related tax issues.

Scam artists can use a variety of tactics. Some scammers operating bogus charities may contact people by telephone to solicit money or financial information. They may even directly contact disaster victims and claim to be working for or on behalf of the IRS to help the victims file casualty loss claims and get tax refunds. They may attempt to get personal financial information or Social Security numbers that can be used to steal the victims’ identities or financial resources.

Bogus websites may solicit funds for disaster victims. Such fraudulent sites frequently mimic the sites of, or use names similar to, legitimate charities, or claim to be affiliated with legitimate charities, in order to persuade members of the public to send money or provide personal financial information that can be used to steal identities or financial resources.   Additionally, scammers often send e-mail that steers the recipient to bogus websites that sound as though they are affiliated with legitimate charitable causes.

Taxpayers suspecting disaster-related frauds should visit IRS.gov and search for the keywords  “Report Phishing.”

More information about tax scams and schemes may be found at IRS.gov using the keywords “scams and schemes.” 

The IRS reminds the nation’s 730,000 federal tax return preparers that they must renew their Preparer Tax Identification Numbers (PTINs) for 2013. Also, preparers who have a competency test requirement should take the time now to schedule an appointment for the RTRP exam.

Anyone who is a paid federal tax return preparer must register with the IRS and have a PTIN, as must all Enrolled Agents. Additionally, some return preparers have new continuing education and competency test requirements.

NOTE FROM ASV: ASV is hosting an RTRP live prep course on December 17, 2012 in Sterling VA. For more information and to register, click here. 

The IRS recently announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for Tax Year 2013.  In general, many of the pension plan limitations will change for 2013 because the increase in the cost-of-living index met the statutory thresholds that trigger their adjustment.  However, other limitations will remain unchanged because the increase in the index did not meet the statutory thresholds that trigger their adjustment.

Revenue Procedure 2012-41 sets forth inflation adjusted items for 2013, including a number of items of interest to tax-exempt organizations, including adjustments affecting the treatment of:

• dues paid to agricultural or horticultural organizations
• insubstantial benefit limitations for contributions associated with charitable fundraising campaigns
• the reporting exception for certain exempt organizations with nondeductible lobbying expenditures

As part of its efforts to support people in the areas hit by Hurricane Sandy, the IRS is expediting the review and approval process for organizations that are applying for tax-exempt status to provide relief for Hurricane Sandy’s victims.

Often, it’s best to use existing charities, including churches and other places of worship, because they tend to have fund-raising and distribution infrastructures already in place and frequently can administer relief programs more efficiently than newly formed organizations.
 
But those who have decided they would prefer to start their own charity should apply to the IRS for tax-exempt status by filing IRS Form 1023. At the top of the form write, “Disaster Relief, Hurricane Sandy.”

The IRS will expedite those applications and ensure they meet the legal requirements for tax exemption.  

More details are in IR-2012-87, IRS Expedites Charity Applications, Urges Use of Existing Charities.

Relief also applies to tax-exempt organizations required to file Form 990 series returns with an original or extended deadline. See IR-2012-83, IRS Provides Tax Relief to Victims of Hurricane Sandy; Return Filing and Tax Payment Deadline Extended to Feb. 1, 2013.

For current information that may apply to your charity, review the following:

• IR-2012-88, Treasury, IRS Announce Special Relief to Encourage Leave-Donation Programs for Victims of Hurricane Sandy
• IR-2012-86, Treasury and IRS Expand Availability of Housing for Hurricane Sandy Victims
• IR-2012-85, IRS Waives Diesel Fuel Penalty Due to Hurricane Sandy
• IR-2012-84, IRS Announces Qualified Disaster Treatment of Payments to Victims of Hurricane Sandy
• IR-2012-82, IRS Gives Additional Time to Taxpayers and Preparers Affected by Hurricane Sandy; File and Pay by Nov. 7

Check Help for Victims of Hurricane Sandy for the latest information.

WASHINGTON undefined As part of the administration’s efforts to bring all available resources to bear to support state and local partners impacted by Hurricane Sandy, the Treasury Department and the Internal Revenue Service today announced special relief intended to support leave-based donation programs to aid victims who have suffered from the extraordinary destruction caused by Hurricane Sandy.

Under these programs, employees may donate their vacation, sick or personal leave in exchange for employer cash payments made to qualified tax-exempt organizations providing relief for the victims of Hurricane Sandy.

Employees can forgo leave in exchange for employer cash payments made before Jan. 1, 2014. Under this special relief, the donated leave will not be included in the income or wages of the employees. Employers will be permitted to deduct the amount of the cash payment. Details on this relief are in Notice 2012-69.

The IRS continues to monitor the situation and will provide additional relief related to Hurricane Sandy as needed.