IRS Tax News

  • 03 Feb 2020 9:02 AM | Anonymous

    Revenue Procedure 2020-08 makes specific modifications to Rev. Proc. 2020-5 to allow for the new electronic submission process of the Form 1023 Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code. It also provides a 90-day transition relief period, during which paper Form 1023 applications will be accepted. This revenue procedure also modifies language related to the submission of written requests of Canadian charities to be listed on the Tax Exempt Organizations Search database or for a determination on private foundation status.

    Revenue Procedure 2020-08 will be in IRB:  2020-08, dated 2/18/2020.

  • 30 Jan 2020 11:19 AM | Anonymous

    WASHINGTON ― The Internal Revenue Service wants seniors to know about the availability of a new tax form, Form 1040-SR, featuring larger print and a standard deduction chart with a goal of making it easier for older Americans to read and use.

    The Bipartisan Budget Act of 2018 required the IRS to create a tax form for seniors. Taxpayers age 65 or older now have the option to use Form 1040-SR, U.S. Tax Return for Seniors. Form 1040-SR, when printed, features larger font and better readability.

    Taxpayers who electronically file Form 1040-SR may notice the change when they print their return. More than 90% of taxpayers now use tax software to prepare and file their tax return.

    Taxpayers born before Jan. 2, 1955, have the option to file Form 1040-SR whether they are working, not working or retired. The form allows income reporting from other sources common to seniors such as investment income, Social Security and distributions from qualified retirement plans, annuities or similar deferred-payment arrangements.

    Seniors can use Form 1040-SR to file their 2019 federal income tax return, which is due April 15, 2020. All lines and checkboxes on Form 1040-SR mirror the Form 1040, and both forms use all the same attached schedules and forms. The revised 2019 Instructions cover both Forms 1040 and 1040-SR.

    Eligible taxpayers can use Form 1040-SR whether they plan to itemize or take the standard deduction. Taxpayers who itemize deductions can file Form 1040-SR and attach Schedule A, Itemized Deductions, when filing a paper return. For those taking the standard deduction, Form 1040-SR includes a chart listing the standard deduction amounts, making it easier to calculate. It also ensures seniors are aware of the increased standard deduction for taxpayers age 65 and older.

    Married people filing a joint return can use the Form 1040-SR regardless of whether one or both spouses are age 65 or older or retired. 

    Both the 1040 and the 1040-SR use the same “building block” approach introduced last year that can be supplemented with additional Schedules 1, 2 and 3 as needed. Many taxpayers with basic tax situations can file Form 1040 or 1040-SR with no additional schedules.
  • 29 Jan 2020 10:22 AM | Anonymous

    Revenue Ruling 2020-04 clarifies the manner to properly compute the income limits applicable to the low-income housing credit under § 42 of the Internal Revenue Code.  The Consolidated Appropriations Act of 2018 added a new minimum set-aside test, the average income test (§ 42(g)(1)(C)), to the existing minimum set-aside tests available to owners of a low-income housing project.  This revenue ruling addresses the additional income limits available in the average income test.

    Revenue Ruling 2020-04 will be in IRB:  2020-8, dated February 18, 2020.

  • 28 Jan 2020 2:40 PM | Anonymous

    WASHINGTON – The Internal Revenue Service wants tax-exempt organizations to know about recent tax law changes that might affect them. The Taxpayer Certainty and Disaster Tax Relief Act, passed on Dec. 20, 2019, includes several provisions that may apply to tax-exempt organizations’ current and previous tax years.

    Repeal of ‘parking lot tax’ on exempt employers
    This legislation retroactively repealed the increase in unrelated business taxable income by amounts paid or incurred for certain fringe benefits for which a deduction is not allowed, most notably qualified transportation fringes such as employer-provided parking. Previously, Congress had enacted this provision as part of the Tax Cuts and Jobs Act, effective for amounts paid or incurred after Dec. 31, 2017.

    Tax-exempt organizations that paid unrelated business income tax on expenses for qualified transportation fringe benefits, including employee parking, may claim a refund. To do so, they should file an amended Form 990-T within the time allowed for refunds. More information on this process can be found at IRS.gov.

    Tax simplification for private foundations
    The legislation reduced the 2% excise tax on net investment income of private foundations to 1.39%. At the same time, the legislation repealed the 1% special rate that applied if the private foundation met certain distribution requirements.

    The changes are effective for taxable years beginning after Dec. 20, 2019.

    Exclusion of certain government grants by exempt utility co-ops
    Generally, a section 501(c)(12) organization must receive 85% or more of its income from members to maintain exemption.

    Under changes enacted as part of the Tax Cuts and Jobs Act, government grants are usually considered income and would otherwise be treated as non-member income for telephone and electric cooperatives. Under prior law, government grants were generally not treated as income, but as contributions to capital.

    The 2019 legislation provided that certain government grants made to tax-exempt 501(c)(12) telephone or electric cooperatives for purposes of disaster relief, or for utility facilities or services, are not considered when applying the 85%-member income test. Since these government grants are excluded from the income test, exempt telephone or electric co-ops may accept these grants without the grant impacting their tax-exemption.

    This legislation is retroactive to taxable years beginning after 2017.

  • 28 Jan 2020 12:20 PM | Anonymous

    IRS YouTube Videos:
    Earned Income Tax Credit – Get it Right – English | Spanish | ASL

    WASHINGTON − The Internal Revenue Service and its partners nationwide remind taxpayers about the Earned Income Tax Credit on Jan. 31, “EITC Awareness Day.” This is the 14th year of the EITC awareness campaign that alerts millions of workers to this significant tax credit.

    "The EITC is a vital tax credit that helps millions of hard-working working families around the nation," said IRS Commissioner Chuck Rettig. "It’s critical that people review the credit to see if they qualify. Increasing awareness about the EITC is important, and the IRS is proud to support the ongoing efforts by partner groups across the country for sharing this critical information with taxpayers.”

    There are outreach events and activities scheduled to promote EITC awareness around the country. The EITC is the federal government’s largest refundable federal income tax credit for low- to moderate-income workers. It can give taxpayers a refund even if they owe no tax.

    The IRS estimates four of five eligible taxpayers claim and get the EITC. Nationwide in 2019, 25 million taxpayers received over $61 billion in EITC. The average EITC amount received was $2,504. The EITC is as much as $6,557 for a family with children or up to $529 for taxpayers who do not have a qualifying child.

    Taxpayers earning $55,952 or less can see if they qualify using the EITC Assistant tool at www.irs.gov/eitc. The EITC Assistant, available in English and Spanish, helps users determine if they are eligible and if they have a qualifying child or children, and it estimates the amount of the EITC they may get. If an individual doesn’t qualify for the EITC, the Assistant explains why.

    Workers who can claim the EITC
    Workers at risk for overlooking this important credit can include taxpayers:

    • Without children
    • Living in non-traditional families, such as a grandparent raising a grandchild
    • Whose earnings declined or whose marital or parental status changed
    • With limited English language skills
    • Who are members of the armed forces
    • Living in rural areas
    • Who are Native Americans
    • With disabilities or who provide care for a disabled dependent

    How to claim the EITC
    To get the EITC, workers must file a tax return and claim the credit, even if their earnings were below the filing requirement. Free tax preparation help is available online and through volunteer organizations.

    Those eligible for the EITC have these options:

    • Free File on IRS.gov. Free brand-name tax software is available that leads taxpayers through a question and answer format to help prepare the tax return and claim credits and deductions, if they are eligible. Free File also provides online versions of IRS paper forms, an option called Free File Fillable Forms, best suited for taxpayers comfortable preparing their own returns.
    • Free tax preparation sites. EITC-eligible workers can seek free tax preparation at thousands of Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) sites. To locate the nearest site, use the search tool on IRS.gov, the IRS2go smartphone application, or call toll-free 800-906-9887. They should be sure to bring along all required documents and information.
    • Find a trusted tax professional. The IRS also reminds taxpayers that a trusted tax professional can prepare their tax return and provide helpful information and advice. Tips for choosing a return preparer and details about national tax professional groups are available on IRS.gov. EITC recipients should be careful not to be duped by an unscrupulous return preparer.

    The IRS reminds taxpayers to be sure they have valid Social Security numbers (SSN) for themselves, their spouse, if filing a joint return, and for each qualifying child claimed for the EITC. The SSNs must be issued before the due date of the return, including extensions. There are special rules for those in the military or those out of the country.

    Refunds
    By law the IRS cannot issue refunds before mid-February for tax returns that claim the EITC or the Additional Child Tax Credit (ACTC). The IRS must hold the entire refund − even the portion not associated with EITC or ACTC. This helps ensure taxpayers receive the refund they deserve and gives the agency more time to detect and prevent errors and fraud. 
     
    'Where’s My Refund?' on IRS.gov and the IRS2Go app will be updated with projected deposit dates for most early EITC/ACTC refund filers by Feb. 22. So EITC /ACTC filers will not see an update to their refund status for several days after Feb. 15. The IRS expects most EITC or ACTC related refunds to be available in taxpayer bank accounts or on debit cards by the first week of March, if they choose direct deposit and there are no other issues with their tax return. Check ‘Where’s My Refund?’ for a personalized refund date.

    Avoid errors
    Taxpayers are responsible for the accuracy of their tax return even if someone else prepares it for them. The EITC rules can be complicated and the IRS urges taxpayers to seek help to make sure they are eligible by visiting a free tax return preparation site, or using Free File software or a paid tax professional. Errors can have lasting impact on future eligibility to claim EITC and leave taxpayers with a penalty.  

    Taxpayers should be sure to reply promptly to any letter from the IRS requesting additional information about EITC and call the number on the IRS letter if they need assistance or have questions.

    Taxpayers who had an EITC claim reduced or denied for any reason other than a mathematical or clerical error must file Form 8862, Information to Claim Certain Credits after Disallowance, to claim the credit.

    Beware of scams
    Be sure to choose a tax preparer wisely. Beware of scams that claim to increase the EITC refund. Scams that create fictitious qualifying children or inflate income levels to get the maximum EITC could leave taxpayers with a penalty.

    Visit IRS online
    IRS.gov is a valuable first stop to help taxpayers get it right this filing season. Information on other tax credits, such as the Child Tax Credit, are also available.

    Related items

  • 28 Jan 2020 12:07 PM | Anonymous

    WASHINGTON — With just a few days remaining until the deadline, the Internal Revenue Service reminds employers and other businesses that Jan. 31 is the filing deadline for submitting wage statements and forms for independent contractors with the government.

    Employers must file their copies of Form W-2, Wage and Tax Statement, and Form W-3, Transmittal of Wage and Tax Statements, with the Social Security Administration by Jan. 31. The Jan. 31 deadline also applies to certain Forms 1099-MISC, Miscellaneous Income, filed with the IRS to report non-employee compensation to independent contractors.

    This deadline helps the IRS fight tax fraud by making it easier to verify income reported on individual tax returns. The IRS no longer grants an automatic extension of time to file Form W-2. Requests for more time to file must be submitted before the due date. Only certain reasons, such as a death or natural disaster are allowed. Details can be found on the instructions for Form 8809, Application for Extension of Time To File Information Returns.

    Failure to file these forms correctly and timely may result in penalties. The IRS recommends employers and other businesses to e-file as the quickest, most accurate and convenient way to file these forms.

    Taxpayers: Steps to take if no W-2

    Most taxpayers get their Form W-2, Wage and Tax Statement, by the end of January. Taxpayers need their W-2s to file accurate tax returns, as the form shows an employee’s income and taxes withheld for the year.

    Taxpayers who haven’t received their W-2 by the end of February should, as a first step, contact their employer. Taxpayers should ask their current or former employer for a copy of their W-2. Be sure the employer has the correct address. Additional information for taxpayers is available at IRS.gov.

  • 27 Jan 2020 4:06 PM | Anonymous

    WASHINGTON ― The Internal Revenue Service successfully opened the 2020 tax filing season today as the agency begins accepting and processing federal tax returns for tax year 2019.

    The deadline to file a 2019 tax return and pay any tax owed is Wednesday, April 15, 2020.  More than 150 million individual tax returns for the 2019 tax year are expected to be filed, with the vast majority of those coming before the April 15 tax deadline. 

    "The IRS workforce has worked for nearly a year to prepare for the opening of tax season,” said IRS Commissioner Chuck Rettig. “Our dedicated employees are committed to help taxpayers, process tax returns and serve the nation − not just through the April 15 tax deadline but throughout the year.”

    While the IRS’ Free File program as well as many tax software companies and tax professionals began accepting tax returns earlier this month, processing of those tax returns begins as IRS systems open today.

    The IRS expects about 90 percent of individuals to file their returns electronically. Filing electronically and choosing direct deposit remains the fastest and safest way to file an accurate income tax return and receive a refund.

    “The IRS reminds taxpayers there are many options to get help,” Rettig said. “Our website has around the clock information available and is the fastest way to get assistance. We’ve made improvements to the Free File program and filing electronically with direct deposit remains the best way to speed refunds and minimize errors. As always, experts in the nation’s tax professional community stand ready to help people navigate their tax issues. And we also remind people our IRS-trained community volunteers are ready to help file tax returns in locations across the country.”

    Revised 2019 Form 1040 includes virtual currency questions

    Using feedback from taxpayers and the tax professional community, IRS revised the Form 1040, U.S. Individual Income Tax Return, for tax year 2019. Taxpayers will use fewer schedules to supplement the base Form 1040 as six schedules were consolidated into three numbered schedules.

    In 2019, taxpayers who engaged in a transaction involving virtual currency will need to file Schedule 1, Additional Income and Adjustments To Income. The Internal Revenue Code and regulations require taxpayers to maintain records that support the information provided on tax returns. Taxpayers should maintain, for example, records documenting receipts, sales, exchanges or other dispositions of virtual currency and the fair market value of the virtual currency.

    “Virtual currency is an important addition to the 1040 this year,” Rettig said. “This emerging area is a priority for the IRS, and we want to help taxpayers understand their obligations involving virtual currency. We will also take steps to ensure fair enforcement of the tax laws for those who don’t follow the rules involving virtual currency.”

    New Form 1040-SR alternative for seniors available

    While all taxpayers file Form 1040, taxpayers born before Jan. 2, 1955, have an additional option to use new Form 1040-SR, U.S. Tax Return for Seniors. Taxpayers age 65 or older will have the option to use this new form – either filing electronically or mailing a paper return − when they file their 2019 federal income tax return in 2020. Form 1040-SR generally mirrors Form 1040.

    Form 1040-SR allows income reporting from certain other sources such as investment income, Social Security, and distributions from qualified retirement plans, annuities or similar deferred-payment arrangements to eligible taxpayers over age 65. Taxpayers 65 and older have the option to file Form 1040-SR whether they are working, not working or retired.

    The Form 1040-SR includes a standard deduction chart listing the standard deduction amounts, including the extra standard deduction amount that taxpayers 65 and older qualify for. Eligible taxpayers 65 and older who plan to itemize deductions − instead of taking the standard deduction − will be able to file Form 1040-SR along with Schedule A, Itemized Deductions, when they file their 2019 tax return.

    The Form 1040 Instructions cover both Form 1040 and Form 1040-SR. Both forms use the same “building block” approach introduced last year that can be supplemented with additional schedules as needed. Taxpayers with straightforward tax situations will only need to file the Form 1040 or Form 1040-SR with no additional schedules.

    Since nearly 90% of taxpayers now use tax software, the IRS expects the change to Form 1040 and the introduction of the Form 1040-SR and its schedules to be seamless for those who file electronically including those who are eligible to use IRS Free File,  the Volunteer Income Tax Assistance (VITA) program or the Tax Counseling for the Elderly (TCE) program.

    Free help preparing and filing taxes electronically

    The IRS strongly encourages people to file their tax returns electronically and choose direct deposit for faster refunds. Filing electronically reduces tax return errors as the tax software does the calculations, flags common errors and prompts taxpayers for missing information.

    The IRS supports free online and in-person tax preparation options for qualifying taxpayers through IRS Free File online or free tax help from trained volunteers at community sites around the country.

    Taxpayers with incomes that were $69,000 or less last year – and that’s most taxpayers – can use IRS  Free File  now through Oct. 15. Free File is a public-private partnership between the Internal Revenue Service and Free File Inc. (FFI), a consortium of tax software providers who make their Free File products available at IRS.gov/FreeFile.

    Taxpayers can use a “look up” tool to choose from one of 10 featured online products. Each of the 10 providers sets its own eligibility standards, generally based on income, age and state residency giving taxpayers who earned $69,000 or less at least one product to use for free. There are also products in Spanish. For taxpayers who earned more, there is Free File Fillable Forms, the electronic version of IRS paper forms. 

    Free File is just one way the IRS provides free tax preparation options to taxpayers through a partnership model. Taxpayers wanting more personal help can visit one of thousands of community volunteer sites through the Volunteer Income Tax Assistance program or Tax Counseling for the Elderly offered by AARP. The IRS partners with community organizations and AARP to train volunteers to prepare free returns for taxpayers.

    The Volunteer Income Tax Assistance (VITA) program offers free tax help to people who generally make $56,000 or less, persons with disabilities and limited English-speaking taxpayers who need help preparing their own tax returns. IRS-certified volunteers provide free basic income tax return preparation with electronic filing to qualified individuals.

    In addition to VITA, the Tax Counseling for the Elderly (TCE) program offers free tax help for all taxpayers, particularly those who are 60 and older, specializing in questions about pensions and retirement-related issues unique to seniors. The IRS-certified volunteers who provide tax counseling are often retired individuals associated with non-profit organizations that receive grants from the IRS.

    Taxpayers: Rely on a reputable tax professional; IRS.gov can help

    The IRS also reminds taxpayers that a trusted tax professional can prepare their tax return and provide helpful information and advice. Tips for choosing a return preparer and details about national tax professional groups are available on IRS.gov.

    No matter who prepares a federal tax return, by signing the return, the taxpayer becomes legally responsible for the accuracy of all information included.

    Gather documents and organize tax records

    The IRS urges all taxpayers to make sure they have all their year-end statements in hand before filing. This includes Forms W-2 from employers and Forms 1099 from banks and other payers. Taxpayers should confirm that each employer, bank or other payer has a current mailing address or email address. Typically, year-end forms start arriving by mail – or are available online – in January. Review them carefully and, if any of the information shown is inaccurate, contact the payer right away for a correction.

    In 2019, taxpayers who engaged in a transaction involving virtual currency will need to file Schedule 1, Additional Income and Adjustments To Income. The Internal Revenue Code and regulations require taxpayers to maintain records that support the information provided on tax returns.  Taxpayers should maintain, for example, records documenting receipts, sales, exchanges, or other dispositions of virtual currency and the fair market value of the virtual currency.

    To avoid refund delays, be sure to gather all year-end income documents before filing a 2019 tax return. Doing so will help avoid refund delays and the need to file an amended return. Filing too early, before receiving a key document, often means a taxpayer must file an amended return to report additional income or claim a refund. It can take up to 16 weeks to process an amended return and issue any related refund.

    Most refunds sent in less than 21 days; however, some require further review and take longer

    Just as each tax return is unique and individual, so is each taxpayer's refund. There are a few things taxpayers should keep in mind if they are waiting on their refund but hear or see on social media that other taxpayers have already received theirs.

    Different factors can affect the timing of a taxpayer’s refund after the IRS receives the return. Also, remember to take into consideration the time it takes for the financial institution to post the refund to the taxpayer’s account or to receive a check in the mail.

    Even though the IRS issues most refunds in less than 21 days, some tax returns require additional review and take longer to process than others. This may be necessary when a return has errors, is incomplete or is affected by identity theft or fraud. The IRS will contact taxpayers by mail when more information is needed to process a return.

    Choosing electronic filing and direct deposit for refunds remains the fastest and safest way to file an accurate income tax return and receive a refund. The IRS expects about 90 percent of individual tax returns will be prepared electronically using tax software.

    The IRS reminds taxpayers that, by law, the IRS cannot issue refunds claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) before mid-February. This applies to the entire refund − even the portion not associated with the EITC or ACTC. The IRS expects most EITC/ACTC related refunds to be available in taxpayer bank accounts or on debit cards by the first week of March, if the taxpayer chose direct deposit and there are no other issues with the tax return.

    After refunds leave the IRS, it takes additional time for them to be processed and for financial institutions to accept and deposit the refunds to bank accounts and products. The IRS reminds taxpayers many financial institutions do not process payments on weekends or holidays, which can affect when refunds reach taxpayers.

    Refund information will generally be available within 24 hours after the IRS acknowledges receipt of an electronically filed return on the Where's My Refund? ‎tool on IRS.gov and the IRS2Go phone app. These tools will be updated with projected deposit dates for most early EITC and ACTC refund filers by Feb. 22, so those filers will not see an update to their refund status date on Where's My Refund? ‎or through their software packages until then. The IRS, tax preparers and tax software will not have additional information on refund dates. Where’s My Refund? is the best way to check the status of a refund.

    Reconcile advance payments of Marketplace premium tax credits; health care reporting changes

    The premium tax credit helps pay premiums for health insurance purchased from the Health Insurance Marketplace. Taxpayers who receive advance credit payments must compare and reconcile their advance credit payments to the actual premium tax credit they are allowed for the year. They do this reconciliation when they file their tax return on Form 8962, Premium Tax Credit. Failing to file Form 8962 and reconcile 2019 advance credit payments may affect return processing, generate an IRS letter and delay the taxpayer’s refund. It may also affect a taxpayer’s eligibility for advance payments of the premium tax credit or cost-sharing reductions to help pay Marketplace health insurance coverage in the future.

    On a separate note, the IRS removed the “full-year health care coverage or exempt” box on Form 1040 to report health care coverage. Taxpayers will not make a shared responsibility payment or file Form 8965, Health Coverage Exemptions, to claim a coverage exemption for tax year 2019.

    Renew expired ITINs to avoid refund delays

    Many Individual Taxpayer Identification Numbers (ITINs) expired on Dec. 31, 2019. This includes any ITIN not used on a tax return at least once in the past three years. Any ITIN with middle digits 83, 84, 85, 86 or 87 expired Dec. 31, 2019. ITINs with middle digits 70 through 82 that expired in 2016, 2017 or 2018 can also be renewed. Affected taxpayers should act soon to avoid refund delays and possible loss of eligibility for some key tax benefits until the ITIN is renewed. An ITIN is used by anyone who has tax filing or payment obligations under U.S. tax law but is not eligible for a Social Security number.

    It can take up to 11 weeks to process a complete and accurate ITIN renewal application. For that reason, the IRS urges anyone with an expired ITIN needing to file a tax return this tax season to submit their ITIN renewal application soon.

    Sign and validate electronically filed tax returns

    The IRS also reminds taxpayers that they should keep copies of their prior-year tax returns for at least three years. Taxpayers who are using the same tax software they used last year will not need to enter prior-year information to electronically sign their 2019 tax return.

    Taxpayers who are using a tax software product for the first time will need their adjusted gross income from their 2018 tax return to file electronically. Review these steps to validate and sign an electronically filed return.

    Identity Theft Central; IP PIN expansion

    The Internal Revenue Service launched Identity Theft Central to improve online access to information on identity theft or data security protection for taxpayers, tax professionals and businesses.

    Improving awareness and outreach have been hallmarks of the initiatives to combat identity theft coordinated by the IRS, state tax agencies and the nation’s tax industry who work in partnership under the Security Summit banner. Tax-related identity theft happens when someone steals personal information to commit tax fraud.

    More taxpayers in selected locations will be eligible for a new online-only Identity Protection PIN Opt-In Program. The IP PIN is a six-digit number that adds a layer of protection for taxpayers’ Social Security numbers and helps protect against tax-related identity theft.

    Taxpayers will be eligible for this voluntary program if they filed a federal tax return last year as a resident from Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Illinois, Maryland, Michigan, Nevada, New Jersey, New Mexico, New York, North Carolina, Pennsylvania, Rhode Island, Texas or Washington.

    The IRS has created a new publication – Publication 5367, Identity Protection PIN Opt-In Program for Taxpayers – to help taxpayers understand the required steps. Or, taxpayers can read more at the Get an IP PIN page. Taxpayers opting into this program must use the Get an IP PIN tool; an IP PIN cannot be issued via a phone call to the IRS.

    IRS offers help and online tools for taxpayers

    The IRS reminds taxpayers they have a variety of options to get help filing and preparing their tax return on IRS.gov, the official IRS website. Taxpayers can find answers to their tax questions and resolve tax issues online. The Let Us Help You page helps answer most tax questions, and the IRS Services Guide links to these and other IRS services.

    Use the Interactive Tax Assistant to find answers to tax questions. This tool provides answers to tax law questions and reflects 2019 tax changes. The ITA is a tax law resource that takes the taxpayer through a series of questions and provides an answer based on their input. It can determine if a type of income is taxable, if the taxpayer is eligible to claim certain credits or deduct certain expenses on their tax return. It also provides answers for general questions, such as determining filing status or if they are required to file a tax return.

    Refund information will generally be available within 24 hours after the IRS acknowledges receipt of an electronically filed return on the Where's My Refund? ‎tool on IRS.gov and the IRS2Go phone app.

    Taxpayers can go to View Your Account Information to securely access information about their federal tax account. They can view the amount they owe, pay online or set up an online payment agreement; access their tax records online; review the past 24 months of payment history; and view key tax return information for the current year as filed. Visit IRS.gov/secureaccess to review the required identity authentication process.

  • 27 Jan 2020 11:37 AM | Anonymous

    WASHINGTON – The Internal Revenue Service has provided relief to financial institutions that were expected to provide required minimum distribution (RMD) statements to IRA owners by Jan 31, 2020. 

    Notice 2020-6 clarifies that if an RMD statement is provided for 2020 to an IRA owner who will turn age 70½ in 2020, the IRS will not consider the statement to be incorrect, but only if the financial institution notifies the IRA owner no later than April 15, 2020, that no RMD is due for 2020.

    The Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) changed the age for which an RMD is first required from age 70½ to 72. Under prior law, financial institutions would have needed to notify IRA owners who attained age 70½ in 2020 about their 2020 RMDs by Jan. 31, 2020.

    The IRS encourages all financial institutions, in communicating these RMD changes, to remind IRA owners who reached age 70½ in 2019, and have not yet taken their 2019 RMDs, that they are still required to take those distributions by April 1, 2020. 

  • 24 Jan 2020 2:27 PM | Anonymous

    Under pre-amended law, by January 31st, the financial institutions would have had to notify IRA owners who turned 70½ in 2020 about the required minimum distribution (RMD) which would have needed to be made for 2020.  The SECURE Act changed the age triggering the RMD requirement from 70 and ½ to 72, so these notices are no longer due under the amended law.   Notice 2020-06 proves that if a RMD statement is provided for 2020 to an IRA owner who will attain age 70½ in 2020, the IRS will not consider such statement to be incorrect, provided that the financial institution notifies the IRA owner no later than April 15, 2020, that no RMD is due for 2020.

    Notice 2020-06 will be in IRB: 2020-7, dated February 10, 2020.

  • 23 Jan 2020 4:32 PM | Anonymous

    WASHINGTON – A globally coordinated day of action to put a stop to the suspected facilitation of offshore tax evasion has been undertaken this week across the United Kingdom (UK), United States (US), Canada, Australia and the Netherlands.

    The action occurred as part of a series of investigations in multiple countries into an international financial institution located in Central America, whose products and services are believed to be facilitating money laundering and tax evasion for customers across the globe.

    It is believed that through this institution a number of clients may be using a sophisticated system to conceal and transfer wealth anonymously to evade their tax obligations and launder the proceeds of crime.

    The coordinated day of action involved evidence, intelligence and information collection activities such as search warrants, interviews and subpoenas. Significant information was obtained as a result and investigations are ongoing. It is expected that further criminal, civil and regulatory action will arise from these actions in each country.

    This is the first major operational activity for the Joint Chiefs of Global Tax Enforcement, known as the J5, formed in mid-2018 to lead the fight against international tax crime and money laundering. This group brings together leaders of tax enforcement authorities from Australia, Canada, the UK, US and the Netherlands.

    “This is the first coordinated set of enforcement actions undertaken on a global scale by the J5 – the first of many,” said Don Fort, US Chief, Internal Revenue Service Criminal Investigation.

    “Working with the J5 countries who all have the same goal, we are able to broaden our reach, speed up our investigations and have an exponentially larger impact on global tax administration. Tax cheats in the US and abroad should be on notice that their days of non-compliance are over,” Fort said.

    Australian Tax Office (ATO) Deputy Commissioner and Australia’s J5 Chief, Will Day, said that this operation shows that the collaboration between the J5 countries is working. “Today’s action shows the power of our combined efforts in tackling global tax crime, fraud and evasion.”

    “This multi-agency, multi-country activity should degrade the confidence of anyone who was considering an offshore location as a way to evade tax or launder the proceeds of crime.”

    The ATO has commenced investigations into Australian based clients of this institution who are suspected to have undeclared income. The Australian Criminal Intelligence Commission (ACIC) is playing a supportive intelligence role, and investigations into more clients may follow.

    “Never before have criminals been at such risk of being detected as they are now. Our increased collaboration, data analytics and intelligence sharing mean there is no place worldwide you can hide your money to avoid contributing your obligations,” Day said.

    Hans van der Vlist, Chief and General Director Fiscal Information and Investigation Service (FIOD), the Netherlands, said, “This is the first outcome of an operational collaboration between five countries on tackling professional enablers that facilitate offshore tax crime.

    The international investigation started on information obtained by the Netherlands. By sharing this information and working together an international impact is created. Together as the J5 we will try to close the net on tax criminals.”

    Canada Revenue Agency (CRA) Chief Eric Ferron said, “I am very pleased with the role the CRA is playing in what will be the first of many major operational activities for the J5. This coordinated operation shows that the collaboration between J5 countries is working. Tax evaders beware; today’s action shows that through our combined efforts we are making it increasingly difficult for taxpayers to hide their money and avoid paying their fair share.”

    Simon York, Chief and Director of Her Majesty’s Revenue and Customs (HMRC)’s Fraud Investigation Service said, “Tax evasion is a global problem that needs a global response and that is what the J5 provides. This kind of international action shows that we can, and we will take on the most collaboration underlines our commitment to tackling these harmful, sophisticated and complex crimes and that we are committed to levelling the playing field for honest businesses and taxpayers.

    “International tax evasion robs our public services of vital funds, undermines economies and, left unchecked, can enrich the dishonest at the expense of the honest majority.

    Working together, HMRC and our J5 partners are closing the net on tax criminals, wherever they are, to ensure nobody is beyond our reach. The message to them is clear – the J5 are closing in.”

    For more information about J5, please visit www.irs.gov/J5.

©2019, Virginia Society of Tax & Accounting Professionals, formerly The Accountants Society of Virginia, 
is a 501(c)6 non-profit organization.

PO Box 3363 | Warrenton, VA 20188 | Phone: (800) 927-2731 | Fax: (888) 403-0920 | asv@virginia-accountants.org

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