Document summaries for the week of Nov. 23, 2020

Tax document summaries for the week of Nov. 23–27, 2020, covering employee benefits, individuals, and more.

EMPLOYEE BENEFITS

Regs. issued on coverage of coronavirus preventive services

The IRS issued temporary and proposed regulations regarding coverage of qualifying coronavirus preventive health services, to implement Section 3203 of the Coronavirus Aid, Relief, and Economic Security Act (CARES) Act, P.L. 116-136. The CARES Act provision shortens the time frame under which nongrandfathered group health plans and health insurance issuers offering nongrandfathered group or individual health insurance coverage must cover, without cost-sharing, the services, including recommended COVID-19 immunizations. T.D. 9931; REG-122426-20 (11/23/20).

 

INTERNATIONAL

Final regs. issued on Secs. 245A and 951A

The IRS issued final regulations that coordinate the Sec. 245A extraordinary disposition rule with the Sec. 951A disqualified basis and disqualified payment rules. T.D. 9934 (11/23/20) (see related news story).

 

IRS PROCEDURE

IRS updates fees on insurers and self-insured health plans

The IRS announced that the applicable dollar amount that must be used to calculate the fees imposed by Sec. 4375 (on the issuer of a specified health insurance policy) and Sec. 4376 (on the plan sponsor of an applicable self-insured health plan) for policy years and plan years ending or after Oct. 1, 2020, and before Oct. 1, 2021, is $2.66, an increase from the prior amount of $2.54. Notice 2020-84 (11/24/20).

Final regs. issued on like-kind exchanges

The IRS issued final regulations that define what property qualifies for Sec. 1031 like-kind exchange treatment. T.D. 9935 (11/24/20) (see related news story).

IRS extends GITCA term

The IRS extended the expiration and renewal terms of Gaming Industry Tip Compliance Agreements (GITCAs) from three to five years. A GITCA allows gaming industry employers to enter into voluntary agreements with the IRS to establish minimum tip rates for tipped employees in specified occupational categories. Rev. Proc. 2020-47 (11/23/20).

DISC base period T-bill rate issued

The IRS issued a base period T-bill rate of 0.73% for the period ending Sept. 30, 2020, for purposes of computing the deferred tax liability of shareholders under Sec. 995(f) in a domestic international sales corporation (DISC). Rev. Rul. 2020-25 (11/23/20).

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DEDUCTIONS

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.

TAX RELIEF

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.