Hedge funds may face tax issues of entity structuring, carried interest, management fee waivers, and trading-related rules. This article highlights planning strategies and compliance considerations as the IRS continues to increase its scrutiny of these investment vehicles.
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IRS Practice & Procedure
Unlocking efficiency and reducing risk: How automation and AI are transforming tax reporting and withholding functions
Taxing authorities’ use of these new tools and capabilities requires corresponding adoption by tax professionals.
Navigating tax controversy strategies amid IRS operational challenges
Practitioners must leverage available technology, build effective communication strategies, and maintain comprehensive documentation of their interactions with the Service.
Assessment of tax for excess APTC payments is invalid
The Tax Court advised a taxpayer that filing a second petition would not allow another IRS Collection Due Process review.
Does an EIN/name mismatch invalidate a refund claim?
Arguments using the ‘informal claim doctrine’ and/or a taxpayer assistance order with the Taxpayer Advocacy Service may help taxpayers whose refund claims are stymied by a mismatch caused by an incorrect employer identification number.
IRS offers extension option for taxpayers facing ERC claim deadlines
Taxpayers meeting eligibility rules can now use Form 907 to preserve their right to challenge ERC disallowances while the IRS continues its review.
IRS to update Form 990 amid transparency push for nonprofits
A Treasury release said the changes are intended to “strengthen tax administration” and provide clearer reporting on the activities of tax-exempt organizations. No timeline was announced.
IRS launches online tool to help taxpayers manage tax debt
Taxpayers can explore payment plans, collection delays, or compromise offers through a streamlined, privacy protected tool.
IRS flagged FATCA noncompliance but followed up with few exams, penalties
TIGTA found the IRS spent hundreds of millions on FATCA oversight while examining only a handful of high-value foreign account cases.
Uncredentialed tax preparer errors included fictitious deductions, review shows
A report from the Center for Taxpayer Rights comes as Congress considers giving the IRS more oversight of the industry.
IRS finalizes deduction rules for tips, adds 3 eligible jobs
The final IRS regulations expand the tips deduction to 71 occupations and clarify rules on qualified tips, digital payments, and automatic gratuities.
Expansion gives millions of entities access to business tax accounts
The IRS said Monday it is opening the online, self-service accounts to partnerships, Indian tribal governments, tax-exempt organizations, and federal, state, and local governments.
IRS tapped Inflation Reduction Act funds to cover 2025 filing season, watchdog says
TIGTA found the IRS spent $4.8 billion in Inflation Reduction Act funds, which were intended to supplement its annual appropriation, on labor and IT to keep the 2025 tax season on track.
IRS’s rejection of marijuana dispensary’s offer in compromise upheld
A marijuana dispensary’s expenses not deductible under Sec. 280E are not taken into account in calculating its reasonable collection potential.
Right to jury trial does not apply to accuracy-related penalties
Seventh Amendment right to jury trial does not apply to Sec. 6663 accuracy-related penalties.
A lower substantial-improvement threshold for rural opportunity zones
In the new zones, business property can become qualified if improvements increase its basis by 50%, rather than the otherwise applicable 100%.
Dissolving business taxpayers: Selected procedural implications
Critical issues include marking returns as final, determining due dates for final returns, filing Form 966, closing IRS accounts, and handling audits of dissolved entities.
IRS watchdog cites resource limits, duplication in partnership audits
The Treasury Inspector General for Tax Administration assessed a soft-letter initiative and the IRS’s examinations of 82 major U.S. partnerships.
AICPA seeks clarity on revamped paid family leave credit rules
The request came in an AICPA letter to Treasury and the IRS seeking guidance on how employers should implement changes to the paid family leave credit.
IRS provides guidance on business interest limitation elections
The guidance in Rev. Proc. 2026-17 is provided in response to H.R. 1’s amendments to Secs. 163(j) and 168(k).
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.
