IRS NEWS FOR TAX PROFESSIONALS – March 2019

IRS NEWS FOR TAX PROFESSIONALS

March 2019

►UPCOMING WEB CONFERENCES

Check Webinars for Tax Practitioners for upcoming webinars. (None scheduled at this time.)

►Recently added to the IRS Video Portal https://www.irsvideos.gov/

Tax Reform Due Diligence Requirements

  • This webinar gives tax professionals updates and guidance on how the Tax Cuts and Jobs Act (TCJA) provisions will affect their due diligence requirements. It also addresses common errors, how to avoid them and applicable penalties if requirements are not met.

►HOT OFF THE PRESS

IRS waives estimated tax penalty for farmers, fishermen who file returns and pay tax by April 15

  • The IRS will waive the estimated tax penalty for any qualifying farmer or fisherman who files his or her 2018 federal income tax return and pays any tax due by Monday, April 15, 2019. The deadline is Wednesday, April 17, 2019, for taxpayers residing in Maine or Massachusetts.

►OTHER NEWS

IRS provides various payment options for taxpayers who owe but can’t pay in full

  • The IRS anticipates that most taxpayers will be affected by major tax law changes. While most will get a tax refund, others may find that they owe taxes, many of whom may qualify for a waiver of the estimated tax penalty that normally applies.
  • The IRS urges people with a filing requirement and a balance due to file by the April 15 deadline even if they cannot pay in full. Taxpayers in this situation should pay what they can and consider a payment plan for the remaining balance.

Pay taxes owed online or set up a payment plan

  • The IRS reminds taxpayers who may unexpectedly owe additional tax that there are many online options for payment as well as online options for applying for a payment plan for those who cannot pay in full.
  • A Paycheck Checkup can help taxpayers see if they are withholding the right amount of tax from their paychecks. Taxpayers who unexpectedly had a tax bill may want to use this feature to ensure that additional taxes are withheld for the 2019 tax year.
  • The IRS Withholding Calculator helps taxpayers figure out if they should submit a new Form W-4 to their employer. Taxpayers will need their most recent pay stub and their most recent federal tax return to complete the process.

National Taxpayer Advocate delivers annual report to Congress: Addresses impact of shutdown; urges more funding for IT modernization

  • National Taxpayer Advocate Nina E. Olson released her 2018 Annual Report to Congress, describing challenges the IRS is facing as a result of the recent government shutdown and recommending that Congress provide the IRS with additional multi-year funding to replace its core 1960s-era information technology (IT) systems. The release of the National Taxpayer Advocate’s report was delayed by a month because of the government shutdown.
  • Olson also released the second edition of the National Taxpayer Advocate’s “Purple Book,” which presents 58 legislative recommendations designed to strengthen taxpayer rights and improve tax administration.

Individuals who need passports for imminent travel should contact IRS promptly to resolve tax debt

  • The IRS reiterated its warning that taxpayers may not be able to renew a current passport or obtain a new passport if they owe federal taxes. To avoid delays in travel plans, taxpayers need to take prompt action to resolve their tax issues.
  • In January of last year, the IRS began implementing new procedures affecting individuals with “seriously delinquent tax debts.” The law requires the IRS to notify the State Department of taxpayers the IRS has certified as owing a seriously delinquent tax debt, which is $52,000 or more. The law also requires State to deny their passport application or renewal. If a taxpayer currently has a valid passport, the State Department may revoke the passport or limit ability to travel outside the United States.

►TAX REFORM – Individuals

Here’s how tax reform affects taxpayers who claim the child tax credit

  • Many people claim the child tax credit to help offset the cost of raising children. Tax reform legislation made changes to that credit for 2018 and later. Here are some important things for taxpayers to know.

►TAX REFORM – Business

Tax Reform Resources

IRS provides a safe harbor method of accounting for passenger automobiles that qualify for the 100-percent additional first year depreciation

  • The IRS issued guidance that provides a safe harbor method for determining depreciation deductions for passenger automobiles that qualify for the 100-percent additional first year depreciation deduction and that are subject to the depreciation limitations for passenger automobiles.
  • Under the Tax Cuts and Jobs Act (TCJA), the additional first year depreciation deduction applies to qualified property, including passenger automobiles, acquired and placed in service after September 27, 2017, and before January 1, 2027.

Opportunity Zones Frequently Asked Questions

►EMPLOYERS AND BUSINESS OWNERS

Cash payment report helps government combat money laundering

  • Federal law requires a person to report cash transactions of more than $10,000 by filing IRS Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business. The information on the form helps law enforcement combat money laundering, tax evasion, drug dealing, terrorist financing and other criminal activities.
  • Who is covered? By law, a “person” is an individual, company, corporation, partnership, association, trust or estate. For example, dealers in jewelry, furniture, boats, aircraft or automobiles; pawnbrokers; attorneys; real estate brokers; insurance companies and travel agencies are among those who typically need to file Form 8300.
  • What’s cash? For Form 8300 reporting, cash includes coins and currency of the United States or any foreign country. It’s also a cashier’s check (sometimes called a treasurer’s check or bank check), bank draft, traveler’s check or money order with a face amount of $10,000 or less that a person receives.

IRS urges businesses to e-file cash transaction reports; It’s fast, easy and free

  • The IRS urges businesses required to file reports of large cash transactions to take advantage of the speed and convenience of filing these reports electronically.
  • Although businesses have the option of filing Form 8300, Report of Cash Payments Over $10,000, on paper, many have already found that e-filing is a faster, more convenient and cost-effective way to meet the reporting deadline. The form is due 15 days after a transaction and there’s no charge for the e-file option.

►THE BEST OF IRS.GOV

Here’s how taxpayers can pay their taxes

►IDENTITY THEFT / DATA THEFT / SCAM ALERTS

Here’s what taxpayers should do to protect private data

  • Taxpayers should protect their personal and financial data from criminals who continue to steal large amounts of information. Thieves use the data to file bogus tax returns and commit crimes while impersonating the victim.

►YOUR PRACTICE

Preparer Compliance – Focused and Tiered

  • One tier in our outreach and educational efforts is sending letters to specific preparers. We look at the number of returns with a high likelihood of refundable credit and HOH filing status errors completed by the same preparer. And, we send letters to preparers who have a high number of these returns. We send letters based on the previous filing season before the next filing season starts and we send letters during the filing season for the current year.

►TAX EXEMPT ORGANIZATIONS

Tax Exempt Organization Search

  • Tax Exempt Organization Search helps users find information about a tax-exempt organization’s federal tax status and filings. You can find:
    • Organizations eligible to receive tax-deductible charitable contributions
    • Automatically revoked organizations
    • IRS determination letters dated on or after January 1, 2014
    • Form 990-series returns
    • Organizations that have filed a Form 990-N (e-Postcard)

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►NEWS FROM OTHER AGENCIES

From the SBA: Do You Have a Savings Plan for Your Small Business?

  • Webinar: This self-paced training exercise will give you an overview of savings plans and strategies for your small business. Learn about the contingency and long-term savings, tax breaks, retirement savings and much more. Duration: 30 minutes.

IRS resources on retirement plans