Because the IRS believes that requiring the filing of Form 1099-C at the expiration of a 36-month nonpayment of debt testing period “creates confusion for taxpayers” and does not increase tax compliance, the Service proposes to eliminate the rule.
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IRS Practice & Procedure
Notice Defines Terms for Economic Substance Doctrine
The IRS provided guidance defining "transaction" for purposes of applying the codified economic substance doctrine and "similar rule of law" for purposes of the accuracy-related penalty.
LB&I Directives on Information Document Requests and Rev. Proc. 94-69
The IRS recently issued new directives to its Large Business and International division that effectively change the process by which LB&I personnel handle information document requests.
AICPA Sues IRS Over Annual Filing Season Program
The AICPA filed suit in the U.S. District Court for the District of Columbia on July 15, asking the court to halt the IRS’s recently introduced Annual Filing Season Program. The AICPA’s three-count complaint asks the court to declare the rule implementing the program unlawful and stop its operation.
Court Says IRS Cannot Prevent Contingent Fee Arrangements for Refund Claims
The U.S. District Court for the District of Columbia granted a motion of summary judgment and issued an injunction to prevent the IRS from regulating contingent fee arrangements for the preparation and filing of ordinary refund claims under Circular 230.
Sec. 6707 Material Adviser Penalty Applies on a Transaction-by-Transaction Basis
The IRS issued final regulations under Sec. 6707, which imposes a large penalty on any material adviser who fails to file a return required under Sec. 6111(a) disclosing a reportable transaction or who files a false or incomplete return.
IRS Signals PPACA Compliance Issues for 2015
This month, the IRS made several updates to the Internal Revenue Manual that provide insight on the notices and enforcement methods the Service will use next tax season to ensure taxpayers comply with the health care law.
AICPA Identifies Problems with IRS’s Electronic Signature Rules
The AICPA raised concerns about the IRS’s recently issued guidance on electronic signatures, especially the standards that apply when a taxpayer does not appear in person before the tax return preparer to present a valid form of identification.
IRS Explains Power-of-Attorney Requirements for Corporate Taxpayers
The IRS issued a bulletin clarifying when corporate officers or employees must have a valid power of attorney in order to represent the company before the IRS.
CPA Practitioners Sue to Stop PTIN Fees
Two CPAs have filed suit in the federal district court, asking the court to stop the IRS from charging fees for issuing PTINs, to obtain refunds of fees paid in the past, and to enjoin the IRS from asking for more information than needed to issue PTINs.
Taxpayers Not Entitled to Question IRS Officials About Summonses
The Supreme Court held that a taxpayer is entitled to question IRS officials about the reasons the IRS issued a summons only if the taxpayer points to specific facts and circumstances that plausibly raise an inference of bad faith on the part of the IRS.
IRS Will Limit Number of Refunds Deposited to Same Account
In its latest attempt to fight tax refund fraud, the IRS said that, beginning in January 2015, it will impose a limit of three electronic direct deposits of tax refunds into a single financial account or prepaid debit card.
Six-Year Statute of Limitation Applies to Assessment
The Tax Court held that the six-year statute of limitation of Sec. 6501(e)(1)(A) applied to an assessment of tax based on a distribution from an ESOP because the taxpayer had not adequately disclosed the distribution on his tax return.
Unused ITINs to Expire Under New IRS Policy
Under a new IRS policy, individual taxpayer identification numbers that are not being used will expire after five years.
Capital Gain, Not Amount Realized, Determines Application of Six-Year Collection Statute
The Tax Court held that gross income for purposes of Sec. 6501(e) statute of limitation calculations includes only the gain from the sale of investments and not the amount realized from their sale.
New IRS Appeals Process Starts Sept. 2
The IRS Office of Appeals is changing the way it handles appeals to examination decisions.
Whistleblower Final Rules Expand Definition of Collected Proceeds
Comprehensive final regulations provide rules for whistleblower awards under Secs. 7623(a) and (b), as well as rules governing the disclosure of return information under Sec. 6103(h) to pursue these claims.
IRS Offers Voluntary Certification of Return Preparers
Following the defeat in federal court of its mandatory tax return preparer regulation program, the IRS in late June introduced a voluntary program of tax return preparer certification.
Form 5472 Filing Requirements to Become More Stringent
The IRS issued final and proposed regulations amending the rules for filing Form 5472.
Suspended or Disbarred Practitioners to Be Allowed to Prepare Tax Returns
The IRS has decided that, as a result of the recent decision preventing it from regulating unenrolled tax return preparers, disbarment or suspension from practice before the IRS cannot include a ban on tax return preparation or blocking an individual’s PTIN.
TAX PRACTICE MANAGEMENT
2025 tax software survey
AICPA members in tax practice assess how their return preparation software performed during tax season and offer insights into their procedures.
