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News & Press: Federal Tax News

IRS NEWS FOR TAX PROFESSIONALS - August 2019

Thursday, August 1, 2019  
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Submitted by Brian Wozniak, IRS Stakeholder Liaison C&L: SL: Area 6 Brian.Wozniak@irs.gov

►UPCOMING WEBINARS

Thursday August 1

  • IRS Civil Enforcement: Field Collection Enforcement and Employment Tax Compliance

Thursday August 15

  • Understanding Form 2290 – Heavy Highway Vehicle Use Tax
  • This webinar will be broadcast in English and Spanish on the same day.

 

HOW TO SHARE IRS INFO ON SOCIAL MEDIA

When you find an article you want to share, click on “Share”. Like so:

  • Scroll to the bottom of any page on IRS.gov. Look for “Share / Print”
  • Click on Share
  • You can share on Facebook, Twitter, or Instagram.

 

►NEWS

2019 Early Release Draft Form 1040 and Form 1040-SR Posted for Comment

  • The IRS posted drafts of the 2019 Form 1040, with related numbered schedules, and the 2019 Form 1040-SR, U.S. Tax Return for Seniors, at IRS.gov/DraftForms. Posting drafts is part of the process for inviting stakeholder input before the forms are finalized. Comments should be sent to WI.1040.Comments@irs.gov

Whistleblower Reforms Under the Taxpayer First Act

  • On July 1, 2019, the President signed the Taxpayer First Act into law. The new law includes several important provisions to help improve taxpayer service, ensure we are continuing to enforce the tax laws in a fair, impartial manner and ultimately support the continued success of our nation. The Act included law changes pertaining to the notification process to whistleblowers and made available protection for whistleblowers against retaliation.

IRS expands list of preventive care for HSA participants to include certain care for chronic conditions

  • The IRS added care for a range of chronic conditions to the list of preventive care benefits that may be provided by a high deductible health plan (HDHP). Notice 2019-45 (PDF), posted today on IRS.gov, lists the new types of medical care that may be treated as preventive care for this purpose.

IRS has begun sending letters to virtual currency owners advising them to pay back taxes, file amended returns; part of agency's larger efforts

  • The IRS has begun sending letters to taxpayers with virtual currency transactions that potentially failed to report income and pay the resulting tax from virtual currency transactions or did not report their transactions properly.
  • "Taxpayers should take these letters very seriously by reviewing their tax filings and when appropriate, amend past returns and pay back taxes, interest and penalties," said IRS Commissioner Chuck Rettig. "The IRS is expanding our efforts involving virtual currency, including increased use of data analytics. We are focused on enforcing the law and helping taxpayers fully understand and meet their obligations."

 

TAX TIPS

Tax transcript tips for those filing a FAFSA for the 2019-2020 college semesters

  • When filling out financial aid applications, students and families may need to get tax information to complete the Free Application for Federal Student Aid form. The IRS Data Retrieval Tool is available to use with the 2019‒2020 FAFSA Form. This tool is the fastest, most accurate way to input tax return information into the FAFSA form.
  • Students and parents who are eligible to use the IRS Data Retrieval Tool can access it from within the Free Application for Federal Student Aid.

Here’s what taxpayers need to know about backup withholding

  • Taxpayers who receive certain types of income may need to have backup withholding taken from these payments. Backup withholding can apply to most payments reported on Forms 1099 and W-2G.
  • Here are some facts to help taxpayers understand backup withholding and determine if they should have it withheld from their income payments.

 

►TAX REFORM

Publication 535, new chapter added on QBI

  • IRS Publication 535 was revised on July 24, 2019 and it includes Chapter 12 on QBI.

TCJA: Section 965 Transition Tax and New Limits on Partners’ Shares of Partnership Losses

  • A new question and answer (Q&A) document is available to help you help your clients meet their filing and payment requirements for the Section 965 transition tax. The Q&As address subsequent installment payments when the transition tax is paid over eight years, the filing of transfer and consent agreements, and more.
  • The IRS has also posted frequently asked questions (FAQs) to help partners properly determine their share of partnership losses. The FAQs, related to Section 704(d), address changes made by the Tax Cuts and Jobs Act that apply partners’ basis limitations to distributive shares of partnership charitable contributions and foreign taxes.

 

EMPLOYERS AND BUSINESS OWNERS

Family Help

  • One of the advantages of operating your own business is hiring family members. However, employment tax requirements for family employees may vary from those that apply to other employees. The following information may assist you with pointing out some differences to consider.

If your business receives a backup withholding notice

  • The IRS issues Backup Withholding CP2100 or CP2100A Notices to certain types of income payers. These notices let payers know backup withholding may need to begin for some taxpayers receiving the payments. For example, if a taxpayer identification number (TIN) is missing or in the instance of an incorrect name/TIN combination.

 

►THE BEST OF IRS.GOV

Basic Tools for Tax Professionals

  • Excellent Resource!

 

IDENTITY THEFT / DATA THEFT / SCAM ALERTS

Taxpayers should be on the lookout for new versions of these two scams

  • Taxpayers should watch for new versions of two tax-related scams. One involves Social Security numbers related to tax issues. The other threatens taxpayers with a tax bill from a fictional government agency. Here are some details about these scams to help taxpayers recognize them.

 

►YOUR PRACTICE

PTIN Required to Prepare Estate, Trust Returns

  • Tax professionals specializing in estate and trust returns must have a Preparer Tax Identification Number (PTIN) and renew it annually. A PTIN is required of paid professionals who prepare or assist in preparing certain federal tax returns, including Form 1041, U.S. Income Tax Return for Estates and Trusts. Failure to enter a valid PTIN can result in a $50 penalty per return and could cause processing delays for your clients.
  • The IRS urges the estate and trust community, especially financial institutions offering services to clients, to ensure that staff who prepare or assist in preparing Forms 1041 have PTINs. PTINs cannot be shared: Each paid professional must have his or her own. Obtaining or renewing a PTIN takes only a few minutes and can be done online. Preparers can obtain a PTIN for 2019 now and renew that PTIN between October and December for 2020. Visit www.irs.gov/ptin to start.

Summer reminder: Review Security Summit Checklist to help secure your data

  • Cybercriminals don’t take vacations – shore up data security before taking your vacation this summer.
  • On July 16, the first of five news releases highlighting the details of each step on the checklist posted. Additional releases will drop through August. We’ve linked to the steps that are released as of this publication’s date.
  • Five steps to better security:

1.     Deploy the “Security Six” measures (July 16)

2.     Create a data security plan (July 23)

3.     Educate yourself about key email scams – including ransomware

4.     Learn to recognize the signs of client data theft and how to report it

5.     Draft a data theft recovery plan

 

►OPR and Department of Justice Tax Division Judgements

Announcement of Disciplinary Sanctions from the Office of Professional Responsibility

  • The Office of Professional Responsibility (OPR) publishes all disciplinary actions in the Internal Revenue Bulletin (IRB). Published sanctions include censure, suspension or disbarment from practice before the Internal Revenue Service. The below listed individuals have recently been disciplined by OPR and are published in IRB Number 2019-22, dated May 28, 2019, on pages 1262-1264.

The Justice Department’s Tax Division reports:

  • In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. To review information about these cases, visit the Justice Department’s website.
    • A Kansas City, Mo., woman, Antoinette Winston, was sentenced to prison to 34 months in prison for wire fraud and aggravated identity theft related to the filing of false tax returns.
    • A federal court in Miami permanently barred Georgina Gonzalez and GeorginagonzalezLLC, Ideal Tax Pros LLC, and Trinity Tax Service LLC, from preparing federal tax returns for others and owning or operating a tax preparation business.

 

►e-Services and MeF

FYI:  e-Services vs. e-News

 

  • e-Services is a suite of web-based tools that allow tax professionals, reporting agents, mortgage industry, payers and others to complete transactions online with the IRS.
  • e-News is a way to get news from the IRS via email.

This is a good time to create an e-Services account

  • Tax professionals who are attorneys, Certified Public Accountants or Enrolled Agents (i.e., Circular 230 practitioners) and do not have an e-Services account may create one and, with proper authorization from clients, can access the e-Services’ Transcript Delivery System. Unenrolled tax practitioners must have an e-File application on file and be listed as delegated users to access TDS.

Modernized e-File (MeF) Operational Status

  • You can check this page to see if MeF is up or down. A good one to save as a favorite!

 

►e-NEWS SUBSCRIPTIONS and SOCIAL MEDIA

 

e-News Subscriptions

  • The IRS offers several e-News subscriptions on a variety of tax topics. Click above for information about subscribing.

IRS Social Media

  • The IRS uses social media tools to share the latest information on tax changes, scam alerts, initiatives, products and services. Connect with the IRS through social media tools.

 

TAX EXEMPT ORGANIZATIONS

Tips to help organizations understand the tax-exempt application process

  • Organizations that want to apply for tax-exempt status under Section 501(c)(3) of the tax code use a Form 1023-series application. Here are some things organizations should know to help them understand the process.

 

►NEWS FROM OTHER AGENCIES

From the SBA:

Best Hiring Practices: What You Can and Can’t Ask a Job Applicant

  • If you are in the market for a new employee, there are many considerations: Does the applicant have the skills to do the job? Will he or she fit into your company culture? These are great questions to ask. But in the course of your search for your next employee, be sure you don’t run afoul of federal and state rules.

 


more Calendar

10/21/2019 » 10/22/2019
2019 OATC Super Star Seminar: Real Estate in the Light of the 2017 TCJA

10/22/2019
Mid-Columbia Chapter: Impact of New Affordable Care Act rules on Tax Preparation (2 hrs CE)

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