The Scoop. Agenda. E Services Changes Ahead 10/7/2016. Kristy Maitre Tax Specialist Center for Agricultural Law and Taxation July 6, 2016

Transcription

1 The Scoop Kristy Maitre Tax Specialist Center for Agricultural Law and Taxation July 6, 2016 Agenda E Services Changes Fake CP 2000 New Procedure for Rollover Requirement Waivers Rev. Proc Premium Tax Credit for Fiscal Year Filers Canada In Informal Talks with IRS on Further Joint Audit Program Office Exam Letter Changes Appeal Issues Partnership Regulations Update IRS Notice Private Debt Collection Proposed legislation E Services Changes Ahead What is planned? In late October target date October 24 the IRS will strengthen the protections for e services accounts by requiring a stronger identity verification process for existing and new e services users Existing e services users will be required to reregister and verify their identities, most through the new Secure Access platform You must revalidate your identity to maintain access to e services products 1

2 E Services Changes Ahead Who is affected? Anyone who currently has an e services account is affected This includes individuals who are registered as: Electronic Return Originators Transmitters Large Business Taxpayers with e file mandates Software Developers ACA insurance provider fee/branded prescription drug filers ACA Information Return Transmitter/Issuer Reporting agents Not for Profit (VITA/TCE/LITC) users States that use Transcript Delivery Service, and IVES Participants E services account holders who only use TIN Matching will also need to validate their identity E Services Changes Ahead What do I have to do? When you return to your e services account on or after October 24, you will be directed to update your account information You will be directed through the Secure Access process, which includes identity proofing, financial verification and mobile phone verification Secure Access is a two factor authentication process which means all returning users, once they have successfully registered, must provide their credentials (username and password) AND the security code sent to their mobile phone via text Important Note: If you have a pay as you go mobile phone or a business/family plan mobile phone not associated with your name, you may request that we mail an activation code to the address we have on file for you You still must have a text enabled, U.S. based phone to receive a security code text that completes the validation process and allows returning users to access their accounts 2

3 More Information At how to register for certain onlineself help tools Fake CP2000 Scam Fake CP2000 Scam 3

4 Fake CP2000 Scam Fake CP2000 Scam Fake CP2000 Scam 4

5 Fake CP2000 Scam Fake CP2000 Scam XXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXX XXXXXXXXXXXXXX New Procedure for Rollover Requirement Waivers Rev. Proc Self certification procedure that may be used to claim eligibility for a waiver of the 60 day rollover time frame Provides a letter ruling procedure for taxpayers to apply for a waiver The procedures also provides for an automatics approval for a waiver in some instances Article on TaxPlace 5

6 Premium Tax Credit for Fiscal Year Filers pdf Issue: What is the applicable percentage and required contribution percentage to be used by a fiscal year taxpayer in determining his or her eligibility for and amount of the premium tax credit under 36B of the Internal Revenue Code, and what is the limitation on excess advance payments of the premium tax credit a fiscal year filer should use? Canada In Informal Talks with IRS on Further Joint Audit Program Pilot program with the Canadian Revenue Agency Possible expansion of program if agreements can be reached Office Exam Cases Letter Change Generally, taxpayers with 240 or more days remaining on their statute of limitations will receive the appropriate 30 day letter This allows 30 days for the taxpayer to respond (and extend the statute if needed) and if the taxpayer fails to respond, it also ensures adequate time to close the case from the group (IRM , Time Frames in Closing a Case from the Group) and provide Technical Services at least 180 days to issue the notice of deficiency 6

7 Office Exam Cases Letter Change Issuance of transmittal letters (less than 240 days remaining on the statute of limitations) If there are fewer than 240 days remaining on the statute, examiners will continue to use the following letters to transmit an agreed report and notify the taxpayer addition time is needed on the statute for Appeals to consider their case if it isunagreed: Letter 5153, Examination Report Transmittal Statute <240 Days (Straight Deficiency) Letter 5153 A, Report Transmittal Statute < 240 days (Claim) Letter 5153 B, Report Transmittal Statute < 240 days (No Change with Adjustments) Office Exam Cases Letter Change The guidance is effective immediately and will be incorporated into IRM , Report Writing, and IRM , SB/SE Field and Office Examination Group Manager, by September 15, 2018 Appeal Issues Cases Excluded from Appeals Consideration Fewer than 365 days remain on the statute of limitations when the case is received in Appeals Request/claim for abatement of unpaid tax (IRM (6) Claims for Abatement Audit Reconsiderations, and Supplemental Reports) that is not an audit reconsideration (taxpayer has no judicial rights) Taxpayer disagree solely on moral, religious, political, constitutional, conscientious, or similar grounds (IRM , No Appeals Conference or Concession on Certain Arguments) 7

8 Partnership Audit Regs. Release Soon What is currently available T.D Reg early opt in election Beginning January 1, 2018 Tax imputed on underpayments will be assessed and collected at the partnership level Partnerships with fewer than 100 partners can opt out of the new audit process What You Should be Doing Now to Assist Your Partnership Clients? The partnership should have a Designated Representative If eligible for op out or required to participate in the new audit process inform partners of the changes to come Review partnerships agrrements IRS Notice Allows institutions to continue offering subsidized coverage for most graduate students in the academic year, enabling many students to continue to receive health care coverage this year However, it also reiterated an interpretation of the law that could jeopardize graduate students access to health coverage 8

9 New Private Debt Collection Program to Begin Next Spring; IRS to Contract with Four Agencies; Taxpayer Rights Protected Private collection of certain overdue federal tax debts will begin next spring IRS has selected four contractors to implement the new program The new program, authorized under a federal law enacted by Congress last December, enables these designated contractors to collect, on the government s behalf, outstanding inactive tax receivables As a condition of receiving a contract, these agencies must respect taxpayer rights including, among other things, abiding by the consumer protection provisions of the Fair Debt Collection Practices Act The IRS has selected the following contractors to carry out this program: The IRS Has Selected the Following Contractors to Carry out the Program CBE Group 1309 Technology Pkwy Cedar Falls, IA Conserve 200 CrossKeys Office park Fairport, NY Performant 333 N Canyons Pkwy Livermore, CA Pioneer 325 Daniel Zenker Dr Horseheads, NY New Private Debt Collection Program to Begin Next Spring; IRS to Contract with Four Agencies; Taxpayer Rights Protected These private collection agencies will work on accounts where taxpayers owe money, but the IRS is no longer actively working their accounts Several factors contribute to the IRS assigning these accounts to private collection agencies, including older, overdue tax accounts or lack of resources preventing the IRS from working the cases The IRS will give each taxpayer and their representative written notice that their account is being transferred to a private collection agency The agency will then send a second, separate letter to the taxpayer and their representative confirming this transfer 9

10 New Private Debt Collection Program to Begin Next Spring; IRS to Contract with Four Agencies; Taxpayer Rights Protected Private collection agencies will be able to identify themselves as contractors of the IRS collecting taxes Employees of these collection agencies must follow the provisions of the Fair Debt Collection Practices Act and must be courteous and respect taxpayer rights The IRS will do everything it can to help taxpayers avoid confusion and understand their rights and tax responsibilities, particularly in light of continual phone scams where callers impersonate IRS agents and request immediate payment New Private Debt Collection Program to Begin Next Spring; IRS to Contract with Four Agencies; Taxpayer Rights Protected Private collection agencies will not ask for payment on a prepaid debit card Taxpayers will be informed about electronic payment options for taxpayers on IRS.gov/Pay Your Tax Bill Payment by check should be payable to the U.S. Treasury and sent directly to IRS, not the private collection agency The IRS will continue to keep taxpayers informed about scams and provide tips for protecting themselves Proposed Legislation 10

11 Ways and Means Proposals to Improve Health Care Dialysis Patients Demonstration Act Voluntary end stage renal disease integrated care within Medicare Co Op Consumer Protection Act (HR 954) Exempts Americans from the ACA individual mandate penalty if health insurance is terminated in certain circumstances S Halt Tax Increases on the Middle Class and Seniors Act 213(a) of the Internal Revenue Code of 1986 is amended by striking 10 per cent and inserting 7.5 percent S Provides an exemption to the individual mandate to maintain health coverage for individuals residing in counties with fewer than 2 health insurance issuers offering plans on an Exchange 11

12 Mobile Workforce State Income Tax Simplification Act of 2015 (H.R. 2315) Under the bill, employee earnings would be fully taxed in the employee's state of residence, but the employee would have to work in another state for at least 30 days before being subject to the other state's taxes Bill has passed the House and has gone to the Senate We will monitor could be a great benefit for some individuals H.R Would Halt Income and Social Security Tax Withholding Would repeal federal income and Social Security tax mandatory withholding and replace it with active payment of those taxes S Would Extend Hardship Exemption From Individual Mandate Would expand the hardship exemption from the Affordable Care Act individual mandate to include individuals residing in service areas where no health insurance issuers are offering plans on a health insurance exchange 12

13 S Access to Childcare Expansion Act or the ACE Act Making the Child and Dependent Care Tax Credit fully refundable Enhancement of the Child and Dependent Care Credit (50% but not below 35%) vs (35% but not below 20%) H. R To amend the Internal Revenue Code of 1986 to include foster care transition youth as members of targeted groups for purposes of the work opportunity credit H.R The Stop Taxing Death and Disability Act The proposal modifies the exclusion of student loan discharges from gross income, by including within the exclusion certain discharges on account of death or disability Loans eligible for the exclusion under the proposal are loans made by (1) the United States (or an instrumentality or agency thereof) (2) a State (or any political subdivision thereof) (3) certain tax exempt public benefit corporations that control a State, county, or municipal hospital and whose employees have been deemed to be public employees under State law (4) an educational organization that originally received the funds from which the loan was made from the United States, a State, or a taxexempt public benefit corporation (5) private education loans (for this purpose, private education loan is defined in section 140(7) of the Consumer Protection Act) 13

14 S Small Business Bill of Rights Temporary reduction of capital gains tax on qualified small business stock Increase in amount allowed as deduction for start up expenditures Repeal of estate and generation skipping transfer taxes Modifications of gift tax Compensating patient injury Punitive damages Authorization of payment of future damages to claimants in health care lawsuits Extend the tax credit for residential energy efficient property Make permanent the energy efficiency credit for existing homes Make permanent the energy efficiency commercial buildings deduction H. R To amend the Internal Revenue Code of 1986 to increase the amount excludable from gross income for dependent care assistance and dependent care flexible spending arrangements and to provide for a carryover of unused dependent care benefits in dependent care flexible spending arrangements. H.R Under the proposal, the discharge of a loan excluded from gross income if the discharge was pursuant to the death or total and permanent disability of the student 14

15 CALT Website Tour of the CALT Website Fall Tax Schools Though they are named the Farm and Urban Tax Schools the schools cover more than farm issues Common return issues for all kinds of returns are covered All kinds of business entities Problematic issues Sometimes we even get into to issues that you many encounter only once or twice a year or tax season The Tax Schools are a blend of diverse topics of interest to all tax professionals This year: New instructors with diverse backgrounds Your adventure awaits at Iowa State s Center for Agricultural Law and Taxation 15

16 Farm and Urban Tax Schools 2016 November 2, 2016 to December 13, Locations in Iowa and Online Webinar Save the Date for the 2016 Annual Farm and Urban Income Tax Schools The program is intended for tax professionals and is designed to provide up to date training on current tax law and regulations November 2 3: Maquoketa November 7 8: Red Oak November 9 10: Sheldon November 14 15: Mason City November 17 18: Ottumwa November 21 22: Waterloo December 5 6: Denison December 12 13: Ames and Live Webinar Winter Webinars ACA (Two Years Later) An Update for the 2017 Filing Season Miscellaneous Income Tax Research with Limited Resources Tax law Update: New Developments Monthly Ethics Classes Beginning Tax Preparers Class CALT is working on offering a basic class for NEW tax preparers this fall in October The week long webinar will cover the basics an individual needs to know such as: Requirement to file Dependents Filing Status Itemized deductions Education Credits Other issues a first or second year preparer needs to know as well as a refresher for others who need to brush up on issues The class will be a week long or more and will be offered at a special rate 16

17 The Scoop Throughout the filing season two Scoops will be held on Scoop Dates 8:00 8:30 am Central time 12:00 12:30 Central time This assists with accommodating our west coast practitioners The same information will be shared at both sessions You have the option of registering for whatever session suits your schedule node fieldseminar date/month Future Scoop Dates October 19, 2016 November 16, 2016 December 14, nodefield seminar date/month The CALT Staff John D. Lawrence Interim Director Associate Dean, College of Agriculture & Life Sciences Extension Programs and Outreach Director, Agriculture & Natural Resources Extension 132 Curtiss Hall Iowa State University Ames, Iowa Kristine A. Tidgren Assistant Director E mail: ktidgren@iastate.edu Phone: (515) Fax: (515)

18 The CALT Staff Kristy S. Maitre Tax Specialist E mail: ksmaitre@iastate.edu Phone: (515) Fax: (515) Tiffany L. Kayser Program Administrator E mail: tlkayser@iastate.edu Phone: (515) Fax: (515)