The IRS issued rules on two special enforcement matters for purposes of the unified partnership audit rules.
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Final regs. govern computation of UBTI for separate businesses
The IRS has posted final regulations governing how tax-exempt organizations determine if they have more than one unrelated trade or business for purposes of unrelated business income tax.
IRS doubles down on nondeductibility of PPP-funded expenses
The IRS issued guidance for taxpayers who pay otherwise deductible expenses with PPP loan funds, stating that even if the payment and PPP loan forgiveness happen in different tax years, the expenses are not deductible.
IRS commissioner: Penalty relief will not be ‘blanket’
IRS Commissioner Charles Rettig told attendees at the AICPA National Tax & Sophisticated Online Tax Conference not to expect blanket penalty relief in response to the COVID-19 pandemic, and he addressed other effects of the pandemic on the agency.
It’s a tough year for year-end tax planning
Advisers face the difficult task of helping clients plan for next year without knowing for certain which party will control the Senate.
IRS will mask business tax transcript identifying information
The IRS announced that beginning Dec. 13 it will mask sensitive data on business tax transcripts, a step it took two years ago for individual tax transcripts.
Partnerships and S corps. can deduct state and local taxes
The IRS said it would issue proposed regulations allowing S corporations and partnerships to deduct “specified income tax payments” paid to state and local governments above the line and not as passthrough items for partners and shareholders.
Taxpayers allowed choice of bonus depreciation rules
The IRS issued rules for taxpayers to follow in applying recently issued bonus depreciation regulations, including how to make several elections.
IRS announces help with tax debt
The IRS said it was revising its procedures to help taxpayers who cannot pay their taxes because of the pandemic. The new program is called the Taxpayer Relief Initiative.
Guidance on deferred employee payroll tax issued
The IRS issued guidance to employers and employees on reporting deferred Social Security tax on Form W-2, Wage and Tax Statement, under the Aug. 8 Presidential Memorandum authorizing the deferral.
Template for requesting penalty abatement available from AICPA
The AICPA has created a template for members to use when requesting a penalty abatement from the IRS. Many taxpayers are receiving penalty notices after COVID-19 hampered their ability to meet tax filing obligations.
2021 inflation adjustments and tax tables issued
The IRS issued the 2021 inflation adjustment amounts and tax tables for use in preparing 2021 tax returns in the 2022 filing season. Many of the over 60 items increased from 2020.
Inflation-adjusted income ranges for 2021 IRA and 401(k) plans
The IRS announced that the income ranges for employee participation in workplace 401(k) plans and IRA contributions will increase from 2020 to 2021. Most of the other retirement plan contribution limits stayed the same, however.
Draft instructions for partnership capital account reporting released
The IRS released draft instructions for Form 1065, U.S. Return of Partnership Income, to calculate partner capital accounts using the tax-basis method.
Unclaimed property distributions allowed as self-certified rollovers
The IRS issued guidance adding state unclaimed property fund distributions to the list of reasons that taxpayers may self-certify that they missed the 60-day deadline to roll over funds to a qualified retirement plan.
FBAR deadline extended to Oct. 31 after confusion
After a misworded posting caused confusion about the 2020 deadline to file FBARs (i.e., FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR)), Treasury’s Financial Crimes Enforcement Network has extended the deadline to Oct. 31.
Inflation-adjusted limit for 2021 HRAs issued
The IRS issued the 2021 limit for excepted benefit health reimbursement arrangements using the Chained Consumer Price Index for All Urban Consumers inflation-adjustment method.
FinCEN pulls announcement of extended FBAR deadline
Treasury’s Financial Crimes Enforcement Network briefly announced, but then rescinded, an extension of this year’s deadline to e-file FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR).
2021 Social Security wage base announced
The Social Security Administration announced that the maximum amount of wages subject to the old age, survivors, and disability insurance tax will increase to $142,800 in 2021 from $137,700 in 2020.
Consolidated group NOL rules are finalized
The IRS finalized regulations governing the treatment of net operating losses by consolidated groups after recent legislation changed the rules.
employee benefits & pensions
Profits interests: The most tax-efficient equity grant to employees
By granting them a profits interest, entities taxed as partnerships can reward employees with equity. Mistakes, however, could cause challenges from taxing authorities.
