Document summaries for the week of March 26, 2018

EMPLOYEE BENEFITS

IRS to issue master and prototype opinion and advisory letters

The IRS announced that it intends to issue opinion and advisory letters for master and prototype and volume submitter preapproved defined benefit plans that were restated for changes in plan qualification requirements listed in Notice 2012-76 (2012 Cumulative List) and that were filed with the IRS during the submission period for the second remedial amendment cycle. Announcement 2018-05 (3/26/18).

 

INTERNATIONAL

IRS addresses national security for Sec. 6038 country-by-country reporting

The IRS issued guidance on certain U.S. multinational enterprise groups that are required to file a Form 8975, Country-by-Country Report, and Schedule A (Form 8975), Tax Jurisdiction and Constituent Entity Information (i.e., those that have more than $850 million in revenue in the prior reporting period) and that also have more than 50% of their revenues attributable to contracts with the Department of Defense or other U.S. governmental intelligence or security agencies, and are therefore defined as specified national security contractors. To protect the United States’ national security interests, the guidance modifies the reporting requirement under Regs. Sec. 1.6038-4 for those specified national security contractors. Notice 2018-31 (3/30/18).

IRS provides report on advance pricing agreements

The IRS issued an announcement under Section 521(b) of the Ticket to Work and Work Incentives Improvement Act of 1999, P.L. 106-170, which requires the secretary of the Treasury to report annually to the public concerning advance pricing agreements (APAs) and the Advance Pricing and Mutual Agreement (APMA) Program, formerly known as the Advance Pricing Agreement (APA) Program. Part I of the report includes information on the structure, composition, and operation of the APMA Program; Part II presents statistical data; and Part III includes general descriptions of various elements of the APAs executed in 2017, including types of transactions covered, transfer-pricing methods used, and completion time. Announcement 2018-08 (3/30/18).

 

IRS PROCEDURE

Final regs. issued on IRS employee satisfaction surveys

The IRS issued final regulations modifying Regs. Sec. 801.5 to allow the IRS to use data obtained from government-wide surveys to measure employee satisfaction and eliminate the need for the Service to administer its own separate internal surveys. T.D. 9831 (3/26/18).

Regulations would limit nongovernment attorneys’ participation in examinations

Proposed regulations would narrow the scope of current regulations by excluding nongovernment attorney contractors from receiving summoned books, papers, or other data under Sec. 6103(n) or from participating in interviews of witnesses summoned by the IRS. REG-132434-17 (3/27/18).

IRS provides transitional guidance on certain fines and penalties

P.L. 115-97 amended Sec. 162(f) and added new Sec. 6050X to the Code. The IRS announced that it intends to issue proposed regulations on these provisions, which provide rules for deducting and reporting fines, penalties, and other amounts, and provided transitional compliance guidance. Notice 2018-23 (3/27/18).

Newsletter Articles

SPONSORED REPORT

Tax reform changes are now in effect

With all the recent tax law changes, this year it’s more important than ever to make sure your clients’ tax situations are squared away before year end. This report provides necessary guidance to ensure 2019 starts without a hitch.

DEDUCTIONS

Understanding the new Sec. 199A business income deduction

The new deduction allows certain business owners to keep pace with the significant corporate tax cut provided by the Tax Cuts and Jobs Act.