January 2011

January 27, 2011

New 1099 Rules: President’s Speech Offers Hope for Some Relief; Exceptions for Rental Income Reporting Remain Vague

For small businesses that were dreading the thought of having to produce a Form 1099 for every payee to which they paid at least $600, President Barack Obama offered the prospect of relief in his State of the Union speech January 25 when he said, “We can start right now by correcting a flaw in the [health care] legislation that has placed an unnecessary bookkeeping burden on small businesses.”

January 26, 2011

Bill Introduced to Address Tax Strategy Patents

On January 25, Senators Max Baucus, D-Mont., and Chuck Grassley, R-Iowa, introduced legislation intended to stop the granting of patents for tax strategies.

January 25, 2011

IRS Targets 1040 Schedules, Procedures in Preparer Compliance Visits

In its current round of office visits involving tax preparer compliance, the IRS is targeting practitioners who prepare a high percentage of returns with certain Form 1040 schedules and is checking preparers’ procedures and recordkeeping.

January 24, 2011

IRS Gives Relief to Return Preparers with Pending PTIN Applications

Because some return preparers are having trouble with the IRS’ new online PTIN application, the IRS on January 24 announced that it is providing relief for preparers who make a good-faith effort to comply with the new PTIN requirement.

January 21, 2011

Lack of Economic Substance Guidance May Chill Legitimate Planning, Organizations Warn

The AICPA and the American Bar Association (ABA) Tax Section jointly issued a comprehensive set of recommendations to the IRS to encourage the Service to quickly establish guidance for applying the economic substance doctrine.

January 21, 2011

IRS Announces Date to Start Processing Delayed Returns

The IRS announced that it plans to be able to start processing tax returns delayed by the late enactment of the 2010 Tax Relief Act on February 14.

January 20, 2011

AICPA Offers Congress 13 Suggested Cleanups for the Tax Code

The AICPA’s second annual compendium of legislative proposals, distributed to key congressional tax committee leaders, seeks to correct technical problems related to a wide range of issues such as tax credits, due dates and penalties.

January 19, 2011

IRS Will Not Meet 80% E-File Goal, Oversight Board Says

The IRS Oversight Board released its Electronic Filing 2010 Annual Report to Congress on January 19, including the news that its goal that 80% of all major tax return types be electronically filed will likely not be met by 2012.

January 18, 2011

IRS Allows More Small Exempt Organizations to File E-Postcard

The IRS has raised the gross receipts threshold for Form 990, Return of Organization Exempt From Income Tax, from $25,000 to $50,000, allowing more tax-exempt organizations to avoid filing a full Form 990 or 990-EZ.

January 14, 2011

2011 Tax Filing Season Gets Under Way with Many Changes

The IRS started accepting e-filed and Free File returns on January 14, marking the official start of the 2011 tax filing season. However, many taxpayers will not be able to file until some time in February while the IRS updates forms and reprograms its systems to account for legislative changes made late in 2010.

January 13, 2011