Document summaries for the week of Nov. 18, 2019

Tax document summaries for the week of Nov. 18–22, 2019, covering employee benefits, individuals, IRS procedure, and more.


IRS announces intention to issue regs. on stock versus indebtedness

The IRS announced that it intends to issue proposed regulations regarding the treatment of certain interests in corporations as stock or indebtedness, and it requested comments from the public regarding the contemplated rules. REG-123112-19 (11/18/19).

Sec. 385 documentation regs. are removed

The IRS removed regulations (Regs. Sec. 1.385-2) that set forth minimum documentation requirements that ordinarily must be satisfied in order for certain related-party interests in a corporation to be treated as indebtedness for federal tax purposes. T.D. 9880 (11/18/19).



IRS issues monthly corporate yield curve and segment rates

The IRS issued guidance on the corporate bond monthly yield curve, the corresponding spot segment rates used under Sec. 417(e)(3), and the 24-month average segment rates under Sec. 430(h)(2). In addition, the IRS provided guidance as to the interest rate on 30-year Treasury securities under Sec. 417(e)(3)(A)(ii)(II), as in effect for plan years beginning before 2008, and the 30-year Treasury weighted average rate under Sec. 431(c)(6)(E)(ii)(I), as reflected by the application of Sec. 430(h)(2)(C)(iv). Notice 2019-61 (11/18/19).



Taxpayer's income too high for healthcare premium assistance tax credits

The Tax Court held that, because a taxpayer received advanced payments of premium assistance tax credits to which he ultimately was not entitled, he was liable for a tax deficiency of more than $8,000. On a separate issue, the court held that the taxpayer was not entitled to a casualty loss deduction because he provided no details about the circumstances or timing of the loss. Blas, T.C. Memo. 2019-152 (11/18/19).

Court upholds collection action against law professor who failed to pay taxes

The Tax Court granted summary judgment to the IRS and sustained a proposed collection action with respect to a taxpayer, a Harvard law professor, who did not file federal tax returns, or pay his tax liability, for 2012 and 2013. In reaching the decision to grant summary judgment, the court noted that the taxpayer submitted no offer of a collection alternative and supplied no financial information requisite to consideration of a collection alternative and was not in compliance with his ongoing tax filing obligations. Sullivan, T.C. Memo. 2019-153 (11/19/19).



Final regs. issued on CFC ownership attribution

The IRS finalized, without changes, regulations concerning the attribution of ownership of stock or other interests for purposes of determining whether a person is a related person with respect to a controlled foreign corporation (CFC) under Sec. 954(d)(3). T.D. 9883 (11/19/19).



Tax Court has insufficient information to decide case

The Tax Court held that the record before it contained insufficient information to decide whether the IRS's determination to sustain two proposed levies and the filing of two notices of federal tax lien was an abuse of discretion. As a result, the court remanded the case to the IRS Appeals Office for further proceedings. Lowery, T.C. Memo. 2019-151 (11/18/19).

IRS issues December 2019 applicable federal rates

The IRS issued a ruling that prescribes the applicable federal rates for December 2019. The ruling provides various prescribed rates for federal income tax purposes including the applicable federal interest rates, the adjusted applicable federal interest rates, the adjusted federal long-term rate, and the long-term tax-exempt rate. Rev. Rul. 2019-26 (11/19/19).

Relief for victims of South Dakota storms

The IRS announced that victims of severe storms, tornadoes, and flooding that began on Sept. 9, 2019, in South Dakota may qualify for tax relief. SD-2019-04 (11/19/19).

Tax Insider Articles


Business meal deductions after the TCJA

This article discusses the history of the deduction of business meal expenses and the new rules under the TCJA and the regulations and provides a framework for documenting and substantiating the deduction.


Quirks spurred by COVID-19 tax relief

This article discusses some procedural and administrative quirks that have emerged with the new tax legislative, regulatory, and procedural guidance related to COVID-19.