Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of July 24, 2023 – July 28, 2023.
July 24, 2023: The IRS released Internal Revenue Bulletin 2023-30, which includes proposed regulations that specify the methodology for constructing the corporate bond yield curve used to calculate present value under a defined benefit plan. The Internal Revenue Bulletin also highlights the following:
- Announcement 2023-18 relieves taxpayers from reporting the new stock repurchase excise tax under § 4501.
- Announcements 2023-19 and 2023-20 revoke the tax-exempt status of certain organizations.
- Notice 2023-37 modifies prior guidance regarding benefits related to testing and treating COVID-19.
- Notice 2023-50 announces that the applicable percentage for purposes of determining percentage depletion on marginal properties for 2023 is 15%.
- Notice 2023-51 publishes the inflation adjustment factor and the reference price for 2023 for the renewable electricity production credit under § 45.
- T.D. 9976 provides final regulations that facilitate the transition from the London Interbank Offered Rate (LIBOR) to other interbank offered rates (IBORs).
July 24, 2023: The IRS released Tax Tip 2023-93, warning businesses and tax-exempt organizations about misleading employee retention credit claims. Scammers and unscrupulous promoters have been running aggressive broadcast advertising, direct mail solicitations and online promotions for the credit, many of which misrepresent and exaggerate who can qualify for the credit.
July 24, 2023: The IRS announced that revenue officers will no longer make unannounced visits to taxpayers’ residences in all but a few narrow circumstances. Instead, they will schedule visits via mailed letters.
July 25, 2023: The IRS released Tax Tip 2023-94, advising that applicable entities, including tax-exempt and governmental entities that would otherwise be unable to claim certain credits because they do not owe federal income tax, can benefit from some clean energy tax credits. If an entity opts to receive an elective payment, the amount of such credits is treated as a payment of tax, and overpayments will result in a refund.
July 25, 2023: The IRS released Notice 2023-53, which provides guidance on the corporate bond monthly yield curve, spot segment rates used under § 417(e)(3) and the 12-month average segment rates under § 430(h)(2).
July 25, 2023: The IRS published a special summer series discussing the Identity Protection PIN Opt-In Program, which can provide an extra layer of security for taxpayers filing their tax returns.
July 26, 2023: The IRS released Tax Tip 2023-95, reminding taxpayers that IRS Free File remains available until October 16 for those who still need to file a 2022 tax return.
July 26, 2023: The IRS released Revenue Procedure 2023-26, which provides a program for the fast-track processing of private letter ruling requests, replacing the pilot program described in Revenue Procedure 2022-10. The revised pilot program no longer requires a statement of business need for fast-track processing, unless the ruling is requested in less than 12 weeks and removes any request if the letter ruling includes a closing agreement with respect to an issue under the jurisdiction of the Associate Chief Counsel (Corporate) or another associate office.
July 26, 2023: IRS Commissioner Daniel Werfel stated that the IRS will increase scrutiny of employee retention credit claims in light of growing fraud in the area. Specifically, the IRS is increasing audit and criminal investigation work involving dubious employee retention credit claims, both on promoters and the businesses filing these claims.
July 27, 2023: The IRS released Tax Tip 2023-96, identifying tax deductions, programs, and allowances that may be relevant for new homeowners, including deductions for home mortgage interest and state and local real estate taxes (subject to the $10,000 limit), the mortgage interest credit, the Homeowners Assistance Fund and allowances for ministers and military service members.
July 27, 2023: The IRS invited public input on improvements to certain post-filing alternative dispute resolution (ADR) programs currently offered to taxpayers, specifically requesting comments on:
- Reasons taxpayers choose not to use ADR programs and potential modifications to these programs that can remedy taxpayer concerns
- Issues that are currently excluded from ADR programs that should not be excluded,
- Other ways in which ADR programs could be improved
- Suggestions for how best to educate taxpayers and representatives about ADR programs
- Experiences with the use of mediators from the IRS Independent Office of Appeals (IRS Appeals) and suggestions for how IRS Appeals can ensure that mediators promote an ADR engagement that is conducive to settlement
- Suggestions for how best to extend the use of ADR programs to taxpayer segments that may be less aware of, or familiar with, ADR, such as small business and low-income taxpayers, and whether any unique characteristics of these segments necessitate modified ADR procedures
- Feedback on experiences with the IRS when ADR programs were offered or not offered by IRS personnel or were denied when requested by taxpayers
- Feedback on whether there are types of cases where ADR has proven particularly useful (g., valuation cases) and, if so, how ADR use can be increased in these types of cases
- Ideas to achieve tax certainty or resolution sooner beyond existing ADR programs, including ideas for new ADR programs.
July 28, 2023: The IRS released Internal Revenue Bulletin 2023-31, which includes the following:
- T.D. 9977 finalizes temporary regulations addressing net operating loss carrybacks under the Coronavirus Aid, Relief and Economic Security (CARES) Act.
- Notice 2023-54 provides transition relief in connection with the change to the required beginning date of required minimum distributions (RMDs) from individual retirement accounts and employer plans; provides guidance related to certain provisions of § 401(a)(9) that apply for years 2021, 2022 and 2023 and the related excise tax under § 4974; and announces an intent to publish final regulations for purposes of RMDs in subsequent tax years.
- Revenue Procedure 2023-25 provides specifications for the private printing of red-ink substitutes for the 2023 Forms W-2 and W-3, superseding Revenue Procedure 2022-30.
- Announcement 2023-21 revokes the tax-exempt status of certain organizations.
July 28, 2023: The IRS announced that David Padrino has been selected to serve as the Chief Transformation and Strategy Officer, a recently created role at the agency that will spearhead improvement efforts under Inflation Reduction Act of 2022 funding.
July 28, 2023: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).
Upcoming Events: Registration for the 2023 IRS Nationwide Tax Forums is now open, and the events have returned to an in-person format for the first time since 2019. The IRS Nationwide Tax Forums are designed specifically for tax professionals (e.g., enrolled agents, certified public accountants, certified financial planners and Annual Filing Season Program participants) as well as uncredentialed tax professionals. The upcoming dates and locations are as follows:
- August 8-10: National Harbor, MD (Washington, DC area)
- August 22-24: San Diego, CA
- August 29-31: Orlando, FL