The IRS announced it had postponed the deadline for its 2011 Offshore Voluntary Disclosure Initiative (OVDI). The new due date for requests is September 9, 2011.
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IRS Practice & Procedure
TIGTA: IRS Does Not Timely Resolve Math Error Disputes
TIGTA released a report in which it recommended that the IRS develop processes to ensure that math error disputes with taxpayers are resolved more quickly and accurately.
Final Regulations Govern Establishing Evidence of Delivery to the IRS
The IRS issued final regulations providing guidance on how taxpayers can prove the timely delivery of physical documents to the IRS or the Tax Court, absent direct proof of delivery.
IRS Revises Actuarial Tables
The IRS issued final regulations relating to the use of actuarial tables for valuing annuities, interests for life or a term of years, or remainder or reversionary interests.
Dispute Resolution Process for the 2011 Prescription Drug Annual Fee
This item describes the exclusive process available to covered entities to dispute the preliminary calculations of the annual fee on branded prescription drugs and obtain any change to data that would be reflected in the final fee allocation.
Codification of Economic Substance Affects All Tax Practitioners
This column discusses uncertainty surrounding the codification of the economic substance doctrine and explores selected areas of impact on CPAs’ professional obligations and practice.
No Reasonable Cause for $3.4 Million Omission from Income
The Tax Court held that a taxpayer did not have reasonable cause for omitting from income $3.4 million from the termination of a swap transaction that was reported to him on a Form 1099.
Final Circular 230 Regs. Implement Preparer Registration Rules
The IRS has issued final regulations implementing components of its initiative to register and regulate all paid tax return preparers.
IRS Removes Form 5472 Duplicate Filing Requirement
The IRS has issued temporary and proposed regulations to remove the duplicate filing requirement for Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business.
Congressional Committee Checks In on Registered Tax Preparer Program
While tax professional communities offered diverging opinions of the registered tax return preparer (RTRP) program to a congressional subcommittee, all agreed on one thing—the IRS made a significant effort to listen.
IRS Discontinues High-Low Method for Substantiating Travel Expenses
The IRS announced that it is discontinuing the high-low method for substantiating lodging, meal and incidental expenses incurred in traveling away from home.
Comments Sought on IRS Continuing Education Provider Standards and Process
The IRS on July 18 invited public comments on its process for approving continuing education providers and on the standards that should apply to such providers.
Economic Substance Guidance Issued to IRS Examiners
The IRS Large Business and International (LB&I) Division issued guidance to examiners on the newly codified economic substance doctrine limiting the application of penalties relating to the doctrine.
100,000 Preparers Did Not Comply with PTIN Rules
The IRS announced that it has identified approximately 100,000 tax return preparers who did not comply with the new rules for preparer tax identification numbers (PTINs), and it is sending them letters informing them of the problem.
AICPA Offers Guidance on Registered Preparer Competency Exam
In a July 7 letter to IRS Commissioner Doug Shulman, the AICPA offered its perspective on the agency’s development of the registered tax return preparer examination.
Penalty Relief for Delinquent FBARs and Forms 5471 Ends August 31
The IRS has provided penalty relief in guidance related to its latest offshore voluntary disclosure initiative. The focus of this item is on who qualifies for penalty relief and procedures for obtaining this relief.
Restricted Interest and Common Errors Made by the IRS
The Internal Revenue Code allows the IRS to charge interest when a taxpayer does not pay all required taxes by the due date of the return. The Code also requires the IRS to pay interest on refunds in certain circumstances. This item discusses the many nuances related to the computation of interest that tax professionals should be familiar with.
Changes in the Lien Process and the Importance of Lien Withdrawals
This item discusses changes in the IRS’s lien process policy. The IRS has made it easier for taxpayers to obtain lien withdrawals after their tax bills are fully satisfied, but this relief is not automatic:
IRS Matching Program for Forms 8023 and 8883 May Result in Invalid Sec. 338 Election
The IRS recently launched a program to match the filing of Form 8023, Elections Under Section 338 for Corporations Making Qualified Stock Purchases, by a foreign purchasing corporation acquiring a foreign target, with Form 8883, Asset Allocation Statement Under Section 338, to report the effect of the Sec. 338 election.
Special Limitation Periods for Carryback Assessments
By exercising its setoff authority, the IRS has been able to achieve the same limitation period in Form 1120X carryback situations as in tentative refund cases with Form 1139.
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.
