Tax News You Can Use – July 2016

Posted on August 3, 2016 · Posted in Industry News, Latest Updates

7/6/16 IRS News:

Employer Shared Responsibility Estimator – The Taxpayer Advocate Service has announced a new Employer Shared Responsibility Provision (ESRP) Estimator designed to help a business determine:

  • Its number of full-time employees, including full-time equivalent employees (FTEs);
  • Whether it might be considered an applicable large employer (ALE), and
  • If it is an ALE, the maximum amount of the potential liability for the employer shared responsibility payment that could apply if the employer fails to offer coverage to the required number of full-time employees and their dependents.

New Procedure for Requesting Return of Seized Assets – The IRS has established a  special procedure for persons to request a return of property or funds seized in “legal source” structuring cases.

Electronically Filed Form 990 Data in New Format – The publicly available data on electronically filed Forms 990 will now be available for the first time in a machine-readable format through Amazon Web Services (AWS). Click here for details.

New Wrongful Incarceration Exclusion – Wrongfully incarcerated taxpayers can take advantage of the new retroactive exclusion from income for any civil damages, restitution or other monetary award received in connection with the incarceration.

2016 ETAAC Report Now Available – The Electronic Tax Administration Advisory Committee (ETAAC) has released its annual report to Congress. The report features recommendations on a wide range of electronic tax administration issues, including progress on reaching its goal to electronically receive 80 percent of tax and information returns, and legislative changes assisting the IRS in meeting this goal.

E-File PIN Tool Discontinued – Due to additional cyber attacks, the IRS has announced that the electronic filing personal identification number (PIN) tool is no longer available on or by toll-free phone. Click here for more information.

Empowerment Zone Designations Continue Through the End of 2016 – The IRS has announced that all empowerment zone designations will remain in effect through the end of 2016. Empowerment zones are certain urban and rural areas where employers and other taxpayers qualify for special tax incentives. This announcement primarily affects businesses that would benefit from claiming the tax incentives for empowerment zones on their 2015 returns, either original or amended, and 2016 returns.

QRPBI Exclusion – Revenue Ruling 2016-15 clarifies when a real estate developer may exclude cancellation of debt (COD) income under the qualified real property business indebtedness (QRPBI) exclusion in §108(a)(1)(D). This ruling provides examples to clarify that QRPBI includes indebtedness relating only to depreciable property used in a taxpayer’s trade or business, and not property held for sale to customers.

IRS 101 Webinars for Tax Professionals – The IRS Stakeholder Liaison Western Area is offering a series of webinars, IRS 101. Register now to learn valuable information as you earn CE credit.

Click here to download the flyer for additional details. Please email with any questions.

Exam Issues in the Appeals Process – Practitioners can learn more about the Office of Appeals and its processes by watching this new YouTube video.

Form 1099-MISC and TIN Matching Program –

Watch the IRS video, “Why File Form 1099-MISC,” and learn about important changes to information return penalties and more. While you’re at the IRS Video Portal, check out the related podcast, “Taxpayer Identification Number (TIN) Matching Program.”

FTB News: 

FTB Tax News – The July 2016 issue of TaxNews, FTB’s monthly online publication, includes the following articles:

  • “Deductibility of Costs for Energy Saving Projects Where Payments are Made through Property Tax Bills”
  • “What is a Business Trust”
  • “Inside FTB – Dissolution/Cancellation Process Team”
  • “What Should Your Client Do if They Can’t Pay Their Balance?”

Click here to subscribe to Tax News and news flashes to automatically receive time-sensitive information via email.

No Cash Policy Exemption – FTB implemented a “No Cash Policy” in all field offices On September 1, 2015 to streamline processes, save costs, and reduce risk to FTB employees and customers. However, in order to address the hardships for taxpayers who are unable to open bank accounts, the FTB implemented an exemption policy on July 1, 2016. Click here for details.
Form 587 Webinar – This 10-minute on-demand webinar covers the key topics on FTB Form 587, Nonresident Withholding Allocation Worksheet, to provide a better understanding of when the form is used and how to properly complete it. Click here for details and to register.

BOE News: 

Bank Change for EFT Program – Beginning July 1, 2016, EFT payments for the BOE changed from Citibank to MUFG Union Bank, N.A. (Union Bank). Click here for new bank and payment processer details.

Emergency Tax Relief for Business Owners Affected by the Erskine Fire – Business owners and tax and feepayers affected by the Erskine Fire in Kern County may request extensions to file their returns, ask for relief from penalties and/or interest for some taxes and fees, or to replace copies of records lost or damaged. Click here for details.

EDD News: 

E-file Mandate – Beginning January 1, 2017 employers with 10 or more employees are required to electronically submit employment tax returns, wage reports, and payroll tax deposits to the EDD. All remaining employers will be subject to this requirement beginning January 1, 2018. Click here for details.

Payroll Tax Relief for San Diego and Kern Counties – Employers in San Diego County directly affected by the severe rainstorms which began on January 7, 2016 in the city of Del Mar, and employers in Kern County directly affected by the Erskine wildfire, may request up to a 60-day extension of time from the EDD to file their state payroll reports and/or deposit state payroll taxes without penalty or interest. For more information, visit the EDD’s Emergency and Disaster Assistance for Employers web page, or contact EDD’s Taxpayer Assistance Center at 888-745-3886.