WASHINGTON — As part of the continued focus on compliance issues, the Internal Revenue Service announced today the establishment of the IRS Office of Promoter Investigations. The new office will further expand on the efforts of the Promoter Investigations Coordinator that began last summer.

“By establishing the Office of Promoter Investigations, we are continuing our increased focus on promoters of abusive tax avoidance transactions, which we have demonstrated over the last year,” said IRS Commissioner Chuck Rettig. “This office will coordinate efforts across multiple business divisions to address abusive syndicated conservation easements and abusive micro-captive insurance arrangements, as well as other transactions.”

Lois Deitrich, a 20-year veteran of the agency, will be the new office’s acting director.

Even though OPI will be positioned within SB/SE, Deitrich will work on agency-wide compliance issues, including coordination of promoter activities with promoter teams in other business divisions, including Large Business & International, Tax Exempt/Government Entities, the Office of Fraud Enforcement, and Criminal Investigations.. She will serve as the principal advisor and consultant to IRS division commissioners and deputy commissioners on issues involving promoters of abusive transactions and the schemes they peddle. The OPI will also develop strategic plans, programs and policy.

Prior to the creation of OPI, the SB/SE division completed a realignment of field examination employees who work on promoter investigations. This realignment brought SB/SE revenue agents under a single director within the Field Exam Division, increasing the focus and attention they apply to investigations going forward. With additional training, resources and applied analytics, SB/SE will bring improved focus on identifying, investigating and taking necessary enforcement action to halt promotion of abusive transactions.

De Lon Harris, commissioner, SB/SE Exam, noted that the realignment of field employees will continue to strengthen the internal compliance efforts within SB/SE.

"These groups are exclusively dedicated to investigating those who peddle abusive tax schemes. Bringing these agents together, in combination with the creation of the service-wide Office of Promoter Investigations, will help strengthen our compliance work and is yet another opportunity to increase our capacity to conduct these investigations," said De Lon Harris, commissioner, SB/SE Exam. "Our promoter office will strategically focus resources to help expand detection and deterrence efforts of promoter work across the IRS."

Deitrich will take over the work the agency has been pursuing for the past year under Brendan O'Dell, who was selected as the Promoter Investigation Coordinator in early 2020.

Prior to this position, Deitrich served as the director of the southwest area of SB/SE’s Field Examination, where she was responsible for overseeing SB/SE field operation for abusive transaction investigations. She brings extensive experience in the abusive transaction space and the Special Enforcement Program. Previously, she served as director of Exam Case Selection and Exam Quality and Technical Support.

Deitrich began her IRS career as a revenue agent in 2001. She holds a master’s degree in Tax from the University of Denver and is a certified public accountant and a certified fraud examiner.

WASHINGTON — The Internal Revenue Service today continued an ongoing effort to help those experiencing homelessness during the pandemic by reminding people who don’t have a permanent address or a bank account that they may still qualify for Economic Impact Payments and other tax benefits.

While Economic Impact Payments continue to be made automatically to most people, the IRS can’t issue a payment to eligible Americans when information about them isn’t available in the tax agency’s systems.

To help people experiencing homelessness, the rural poor and other historically under-served groups, the IRS urges community groups, employers and others to share information about Economic Impact Payments and help more eligible people file a tax return so they can receive everything they’re entitled to.  IRS.gov has a variety of information and tools to help people receive the Economic Impact Payments.

“The IRS has been continuing to work directly with groups inside and outside the tax community to get information directly to people experiencing homelessness and other groups to help them receive Economic Impact Payments,” said IRS Commissioner Chuck Rettig. “The IRS is working hard on this effort, enabling millions of people who don’t normally file a tax return to receive these payments. But we need to do more, and we appreciate all the help we’ve been receiving from national and local groups to assist in this effort to reach the people who desperately need this help.”

Economic Impact Payments, also known as stimulus payments, are different from most other tax benefits; people can get the payments even if they have little or no income and even if they don’t usually file a tax return. This is true as long as they have a Social Security number and are not being supported by someone else who can claim them as a dependent.

The IRS needs information from people who don’t usually file a tax return – even if they did not have any income last year or their income was not large enough to require them to file. The only way for the agency to have that information is for people to file a basic 2020 tax return with the IRS. Once that return is processed, the IRS can quickly send stimulus payments to an address selected by the eligible individual. People do not need a permanent address or a bank account. They don’t need to have a job. For eligible individuals, the IRS will still issue the payment even if they haven’t filed a tax return in years.

People in this group can still qualify for the first two Economic Impact Payments when they file their 2020 return by claiming the Recovery Rebate Credit. There’s a special section on IRS.gov that can help: Claiming the 2020 Recovery Rebate Credit if you aren’t required to file a tax return. For the current third round of payments, people who are experiencing homelessness usually qualify to receive $1,400 for themselves. If they are married or have dependents, they can get an additional $1,400 for each of their family members.

Filing a 2020 federal income tax return that provides very basic information about the person is something that can be done electronically using a smartphone or a computer. When the IRS receives the return, it will automatically calculate and issue the Economic Impact Payments to eligible individuals.

Permanent address not required

People can claim an Economic Impact Payment or other credits even if they don’t have a permanent address. For example, someone experiencing homelessness may list the address of a friend, relative or trusted service provider, such as a shelter, drop-in day center or transitional housing program, on the return filed with the IRS. If they are unable to choose direct deposit, a check or debit card for the tax refund and the third Economic Impact Payment can then be mailed to this address.

Individuals experiencing homelessness can receive the EITC

A worker experiencing homelessness can get an Earned Income Tax Credit (EITC). To get the credit, federal law requires that a worker live in the U.S. for more than half of the year and meet other requirements. This means living in a home in any of the 50 states or the District of Columbia. Therefore, individuals experiencing homelessness, including those who reside at one or more homeless shelters, can meet that requirement.

No bank account? No problem

Many financial institutions will help a person lacking an account to open a low-cost or no-cost bank account. Individuals who open accounts will then have an account and routing number available when they file and claim a direct deposit of the Economic Impact Payment.

Visit the Federal Deposit Insurance Corporation (FDIC) website for details, in both English and Spanish, on opening an account online. Among other things, people can also use the FDIC’s BankFind tool to locate a nearby FDIC-insured bank. In addition, BankOn, American Bankers Association, Independent Community Bankers of America, National Credit Union Administration have all compiled lists of banks and credit union that can open an account online.

For veterans, see the Veterans Benefits Banking Program (VBBP) for access to financial services at participating banks.

For those with a prepaid debit card, they may be able to have their refund applied to the card. Many reloadable prepaid cards or mobile payment apps have account and routing numbers that can be provided to the IRS. Individuals would need to check with the financial institution to ensure the card can be used and to obtain the routing number and account number, which may be different from the card number.

File for free

The fastest and easiest way to claim the 2020 Recovery Rebate Credit and Earned Income Tax Credit (EITC) or to get the third Economic Impact Payment is to file a return electronically using IRS Free File. People can use a smartphone or computer to visit IRS.gov and click the Free File link.

Through the Free File system, anyone who qualifies for the EITC also qualifies to use brand-name software to prepare and electronically file their return for free. The IRS urges anyone experiencing homelessness who has a smartphone or access to a computer to take advantage of this service.

Get free help from IRS partners

Alternatively, anyone who qualifies for the EITC or does not have a filing requirement but is filing to get an Economic Impact Payment also qualifies for free tax help from a trained community volunteer tax preparer. Through VITA (Volunteer Income Tax Assistance) and TCE (Tax Counselling for the Elderly), volunteers prepare basic tax returns at thousands of tax help sites nationwide.

Please note that some VITA/TCE sites are not operating at full capacity and others are not opening this year. To find the nearest location, visit the Free Tax Return Preparation site on IRS.gov, or call 800-906-9887. VITA/TCE site availability is updated throughout the filing season, so check back if there aren’t any sites listed nearby.

The IRS also continues to work extensively with community groups across the country to get people to file tax returns and receive all the Economic Impact Payments and credits they’re entitled to. These efforts helped lead to more than 8 million people last year to submit tax returns who normally don’t file.

Direct deposit speeds payments

Direct deposit is the safest and fastest way to receive a refund and Economic Impact Payments. People will need to include direct deposit information on their 2020 tax return to get their payment directly deposited.

Anyone with a savings, checking, or brokerage account can choose to have their refund electronically deposited in that account. Direct deposit is available even for people who file a paper tax return, but processing of paper returns takes longer.

More details on the Earned Income Tax Credit

For people experiencing homelessness who have a job, filing a return often carries an added bonus—getting a refund based on various tax benefits, especially the EITC for low-and moderate-income workers and working families.

Like many other workers, some workers experiencing homelessness still qualify for the credit even if they earned too little income during 2020 to owe tax. For 2020, the income limit is $15,820 for singles with no children ($21,710 for couples with no children).  The income limit is higher for people with children.  For example, the limit is $50,594 for singles with three or more children ($56,844 for couples with three or more children). Those who make less than this amount must also meet other eligibility requirements.

Because it’s a refundable credit, those who qualify and claim the credit could pay less federal tax, pay no tax, or even get a tax refund. The EITC can put up to $6,660 into a worker’s pocket. The amount varies depending upon the worker’s income, marital status, and other factors.

The IRS recognizes that eligible workers experiencing homelessness often encounter unique challenges not faced by other people.

To find out if they’re eligible, people can use the EITC Assistant on IRS.gov. It’s available in both English and Spanish.

Help spread the word

Employers can help by making their employees aware of the third Economic Impact Payment, 2020 Recovery Rebate Credit and Earned Income Tax and Child Tax Credit, and by encouraging them to file for these benefits based on tax year 2020 rules. In addition, the American Rescue Plan, enacted in March 2021, expands EITC and the Child Tax Credit benefits for the 2021 tax year.

Some people will be able to get advance payments of the Child Tax Credit later this year. There is nothing those who qualify need to do at this point other than file a 2020 tax return.

Employers can also help by making it easy for employees to obtain or access their 2020 W-2 forms. For more information, check out the outreach material, available on IRS.gov.

Revenue Ruling 2021-08 provides various prescribed rates for federal income tax purposes including the applicable federal interest rates, the adjusted applicable federal interest rates, the adjusted federal long-term rate, and the adjusted federal long-term tax-exempt rate. These rates are determined as prescribed by § 1274. 

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

Revenue Ruling 2021-08 will be in IRB:  2021-18, dated May 3, 2021.

WASHINGTON — Today, the Internal Revenue Service, the U.S. Department of the Treasury and the Bureau of the Fiscal Service announced they are disbursing nearly 2 million payments in the fifth batch of Economic Impact Payments from the American Rescue Plan.

Today’s announcement brings the total disbursed so far to approximately 159 million payments, with a total value of more than $376 billion, since these payments began rolling out to Americans in batches as announced on March 12. 

The fifth batch of payments began processing on Friday, April 9, with an official payment date of April 14, with some people receiving direct payments in their accounts earlier as provisional or pending deposits. Here is additional information on this batch of payments:

Additional information is available on the first four batches of Economic Impact Payments from the American Rescue Plan, which began processing on April 2, March 26, March 19 and March 12.

A larger percentage of payments was made electronically during this round of payments than during previous rounds.  This accelerated the delivery of payments to millions of American families whose payments would otherwise have been sent by mail. Over 95% of all Social Security beneficiaries have been paid electronically during this round of payments, compared to 70% in the first round and 72% in the second round.

The IRS will continue to make Economic Impact Payments on a weekly basis.  Ongoing payments will be sent to eligible individuals for whom the IRS previously did not have information to issue a payment but who recently filed a tax return, as well to people who qualify for “plus-up” payments.

Special reminder for those who don't normally file a tax return

Although payments are automatic for most people, the IRS continues to urge people who don’t normally file a tax return and haven’t received Economic Impact Payments to file a 2020 tax return to get all the benefits they’re entitled to under the law, including tax credits such as the 2020 Recovery Rebate Credit, the Child Tax Credit, and the Earned Income Tax Credit.  Filing a 2020 tax return will also assist the IRS in determining whether someone is eligible for an advance payment of the 2021 Child Tax Credit, which will begin to be disbursed this summer.

For example, some federal benefits recipients may need to file a 2020 tax return – even if they don't usually file – to provide information the IRS needs to send payments for a qualifying dependent. Eligible individuals in this group should file a 2020 tax return as quickly as possible to be considered for an additional payment for their qualifying dependents.

People who don't normally file a tax return and don't receive federal benefits may qualify for these Economic Impact Payments. This includes those experiencing homelessness, the rural poor, and others. Individuals who didn't get a first or second round Economic Impact Payment or got less than the full amounts may be eligible for the 2020 Recovery Rebate Credit, but they’ll need to file a 2020 tax return. See the special section on IRS.gov: Claiming the 2020 Recovery Rebate Credit if you aren't required to file a tax return.

Free tax return preparation is available for qualifying people.

The IRS reminds taxpayers that the income levels in this new round of Economic Impact Payments have changed. This means that some people won't be eligible for the third payment even if they received a first or second Economic Impact Payment or claimed a 2020 Recovery Rebate Credit. Payments will begin to be reduced for individuals making $75,000 or above in Adjusted Gross Income ($150,000 for married filing jointly). The payments end at $80,000 for individuals ($160,000 for married filing jointly); people with Adjusted Gross Incomes above these levels are ineligible for a payment.

Individuals can check the Get My Payment tool on IRS.gov to see the payment status of these payments. Additional information on Economic Impact Payments is available on IRS.gov.

Notice 2021-28 is the recommendation solicitation notice for the 2021-2022 Priority Guidance Plan.

The notice will appear in IRB 2021-18 dated May 3, 2021.

Notice 2021-24 amplifies the guidance in Notice 2020-22, 2020-17 I.R.B. 664, which provides for penalty relief under section 6656 of the Code for an employer’s failure to timely deposit Employment Taxes with the IRS.  This notice provides relief from section 6656 for employers required to pay qualified sick leave wages and qualified family leave wages, and qualified health plan expenses allocable to these wages, mandated by the Families First Coronavirus Response Act, as amended by the COVID-related Tax Relief Act of 2020, and the American Rescue Plan Act of 2021 (American Rescue Plan Act).  This notice also provides relief from section 6656 for certain employers subject to a full or partial closure order due to COVID-19 or experiencing a statutorily specified decline in business under the Coronavirus Aid, Relief, and Economic Security Act, as amended by the Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act.  Finally, this notice provides relief from section 6656 for certain employers for which COBRA continuation coverage premiums were not paid by assistance eligible individuals for such coverage by reason of section 9501(a)(1) of the American Rescue Plan Act.  This relief ensures that such employers may pay qualified sick leave wages and qualified family leave wages, qualified wages, and COBRA continuation coverage premiums using Employment Taxes that would otherwise be required to be deposited without incurring a failure to deposit penalty.

Notice 2021-24 will be in IRB: 2021-18, dated 05/03/2021.

Notice 2021-24 amplifies the guidance in Notice 2020-22, 2020-17 I.R.B. 664, which provides for penalty relief under section 6656 of the Code for an employer’s failure to timely deposit Employment Taxes with the IRS.  This notice provides relief from section 6656 for employers required to pay qualified sick leave wages and qualified family leave wages, and qualified health plan expenses allocable to these wages, mandated by the Families First Coronavirus Response Act, as amended by the COVID-related Tax Relief Act of 2020, and the American Rescue Plan Act of 2021 (American Rescue Plan Act).  This notice also provides relief from section 6656 for certain employers subject to a full or partial closure order due to COVID-19 or experiencing a statutorily specified decline in business under the Coronavirus Aid, Relief, and Economic Security Act, as amended by the Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act.  Finally, this notice provides relief from section 6656 for certain employers for which COBRA continuation coverage premiums were not paid by assistance eligible individuals for such coverage by reason of section 9501(a)(1) of the American Rescue Plan Act.  This relief ensures that such employers may pay qualified sick leave wages and qualified family leave wages, qualified wages, and COBRA continuation coverage premiums using Employment Taxes that would otherwise be required to be deposited without incurring a failure to deposit penalty.

Notice 2021-24 will be in IRB: 2021-18, dated 05/03/2021.

IRS YouTube Video:
Do Your Taxes for Free with Free File - English |Spanish

WASHINGTON – The Internal Revenue Service today urged low- and moderate-income individuals and families, especially those who don’t normally file a tax return, to use IRS Free File  to prepare their own federal tax return, e-file it and get a refund – all for free.

This year’s federal tax filing deadline for individuals has been postponed to May 17 from April 15.

Free File offers free access to brand-name tax software to anyone who makes $72,000 or less. Already this year, more than 2.96 million individuals and couples have used this online service to file returns and get their share of these valuable benefits.

Available only at IRS.gov, Free File offers people experiencing homelessness, students who are now on their own, low-and moderate-income families and others a fast and easy way to access these benefits. All anyone needs to reach Free File is access to a computer or similar device. No computer? No problem. IRS Free File products support mobile phone access too.

Never has Free File been as important as it is right now. The IRS delivered two rounds of Economic Impact Payments to eligible people. The first payment was up to $1,200 per person and $500 per qualifying child. The second payment was up to $600 per eligible person and $600 per qualifying child.

People who did not receive the full amount of the first or second payments can claim the additional amount they are due as the Recovery Rebate Credit when they file their 2020 tax return.

And that’s where Free File comes in. It’s a free way to claim the full amount of tax benefits, including the Recovery Rebate Credit, and ensure that eligible people get their refund. See the special section on IRS.gov - Claiming the 2020 Recovery Rebate Credit if you aren’t required to file a tax return – for more information. Look for a Free File product with “no minimum income” and file electronically and choose direct deposit.

Free File is also a great way to take advantage of two other tax benefits that help workers and families --the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (ACTC). Under a special COVID-related rule, people who were laid off during part or all of 2020 will often still qualify for these benefits. That’s because if they worked during 2019, they can choose to use their 2019 earned income to figure these credits, as long as it was higher than it was in 2020.

Through Free File, leading tax software providers make their online products available for free as part of a 19-year partnership with the IRS. There are nine products in English and one in Spanish. Visit IRS.gov/FreeFile for details. In addition, MilTax, available free through the Department of Defense, offers a similar online tax-preparation service to members of the military.

Because Free File returns are filed electronically, the service offers everyone a great way to get their money quickly. This is especially true for anyone who chooses to have their refund deposited directly into a savings or checking account.

The IRS urges everyone to consider taking advantage of the speed and convenience of Free File. This includes:

For a closer look at how Free File can help people get all available tax benefits, visit IRS.gov/closerlook.

For those who are not comfortable doing their own return, IRS-trained community volunteers offer tax help at more than 11,000 tax help sites, nationwide. To find the nearest site, visit IRS.gov/Volunteers, or call 800-906-9887.

Notice 2021-27 sets forth updates on the corporate bond monthly yield curve, the corresponding spot segment rates for April 2021 used under § 417(e)(3)(D), the 24-month average segment rates applicable for April 2021, and the 30-year Treasury rates, as reflected by the application of § 430(h)(2)(C)(iv).  In addition, it contains 24-month average segment rates for January 2020 through April 2021 determined under § 430(h)(2)(C)(iv) reflecting the modifications made by § 9706(a) of the American Rescue Plan Act of 2021. 

Notice 2021-27 will be in IRB:   2021-18, dated May 3, 2021.

WASHINGTON — The American Rescue Plan Act of 2021 suspends the requirement that taxpayers increase their tax liability by all or a portion of their excess advance payments of the Premium Tax Credit (excess APTC) for tax year 2020. A taxpayer’s excess APTC is the amount by which the taxpayer’s advance payments of the Premium Tax Credit (APTC) exceed his or her Premium Tax Credit (PTC).     

The Internal Revenue Service announced today that taxpayers with excess APTC for 2020 are not required to file Form 8962, Premium Tax Credit, or report an excess advance Premium Tax Credit repayment on their 2020 Form 1040 or Form 1040-SR, Schedule 2, Line 2, when they file.

Eligible taxpayers may claim a PTC for health insurance coverage in a qualified health plan purchased through a Health Insurance Marketplace. Taxpayers use Form 8962, Premium Tax Credit to figure the amount of their PTC and reconcile it with their APTC. This computation lets taxpayers know whether they must increase their tax liability by all or a portion of their excess APTC, called an excess advance Premium Tax Credit repayment, or may claim a net PTC.

Taxpayers can check with their tax professional or use tax software to figure the amount of allowable PTC and reconcile it with APTC received using the information from Form 1095-A, Health Insurance Marketplace Statement.
 
The process remains unchanged for taxpayers claiming a net PTC for 2020. They must file Form 8962 when they file their 2020 tax return. See the Instructions for Form 8962 for more information. Taxpayers claiming a net PTC should respond to an IRS notice asking for more information to finish processing their tax return.

Taxpayers who have already filed their 2020 tax return and who have excess APTC for 2020 do not need to file an amended tax return or contact the IRS. The IRS will reduce the excess APTC repayment amount to zero with no further action needed by the taxpayer. The IRS will reimburse people who have already repaid any excess advance Premium Tax Credit on their 2020 tax return. Taxpayers who received a letter about a missing Form 8962 should disregard the letter if they have excess APTC for 2020. The IRS will process tax returns without Form 8962 for tax year 2020 by reducing the excess advance premium tax credit repayment amount to zero.

Again, IRS is taking steps to reimburse people who filed Form 8962, reported, and paid an excess advance Premium Tax Credit repayment amount with their 2020 tax return before the recent legislative changes were made. Taxpayers in this situation should not file an amended return solely to get a refund of this amount. The IRS will provide more details on IRS.gov. There is no need to file an amended tax return or contact the IRS. 

As a reminder, this change applies only to reconciling tax year 2020 APTC. Taxpayers who received the benefit of APTC prior to 2020 must file Form 8962 to reconcile their APTC and PTC for the pre-2020 year when they file their federal income tax return even if they otherwise are not required to file a tax return for that year.  The IRS continues to process prior year tax returns and correspond for missing information.  If the IRS sends a letter about a 2019 Form 8962, we need more information from the taxpayer to finish processing their tax return. Taxpayers should respond to the letter so that the IRS can finish processing the tax return and, if applicable, issue any refund the taxpayer may be due.

See the  Form 8962, Premium Tax Credit, and IRS Fact Sheet for more details about the changes related to the PTC for tax year 2020.