Tax News You Can Use

Posted on November 3, 2015 · Posted in Industry News, Latest Updates

11/3/15

IRS News:

ACA Updates – Forms 1095-B, Health Coverage, and 1095-C, Employer-Provided Health Insurance Offer and Coverage Insurance are due to individuals by February 1, 2016.

Basic Tools for Tax Professionals – The IRS has updated its Basic Tools for Tax Professionals web page, including a list of frequently used phone numbers for practitioners.

Publication 4557 RevisedSafeguarding Taxpayer Data – A Guide for Your Business has been updated to include information on identity theft, references and important links.

EITC Letters Sent – Tax preparers who submitted incorrect or highly questionable Earned Income Tax Credit (EITC) tax returns this past year may receive one or more compliance letters.

1040 and Business e-File Shutdown – Shutdown for the Form 1040 series will begin on Saturday, November 21, 2015 at 8:59 a.m. PT in order to prepare the system for the upcoming 2016 filing season. Business Forms shutdown is scheduled to begin on Saturday, December 26, 2015 at 8:59 a.m. PT. The Legacy Electronic Management System for employment tax returns will be permanently retired in December 2015.

New IP PIN Rules in 2016 – Starting January 1, 2016  new Identity Protection (IP) PIN rules will require all IP PIN owners, including primary, secondary and dependent/qualifying individual, to enter their six-digit numbers on certain forms.

New Entertainment Audit Technique Guide – A recently updated Entertainment Audit Technique Guide includes examination techniques, common and unique industry issues, business practices, industry terminology, and more related to the entertainment industry.

2016 Pension Plan Limitations – In general, the pension plan limitations will not change for 2016 because the increase in the cost-of-living index did not meet the statutory thresholds that trigger their adjustment, and the 401(k) contribution limit remains unchanged at $18,000 for 2016.

Annual Inflation Adjustments – For tax year 2016, the IRS has announced annual inflation adjustments for more than 50 tax provisions, including the tax rate schedules.

Tax Relief for Drought-Stricken Farmers – The IRS has extended the time to replace livestock that farmers or ranchers were forced to sell due to drought.

Limited Practice Changes – Effective for tax returns and claims for refunds prepared and signed after Dec. 31, 2015, the limited right to represent clients before the IRS held by non-credentialed preparers will be accorded to only those preparers participating in the IRS Annual Filing Season Program, a voluntary continuing education (CE) program. Non-credentialed tax return preparers who participate in the Annual Filing Season Program will continue to have limited rights to represent clients.

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FTB News: 

HOH Letters MailedThe FTB is mailing more than 83,000 letters to taxpayers asking them to justify their Head of Household (HOH) filing status for their 2014 tax year.

Distinguishing Between S Corporations and LLCs – The FTB has provided a chart showing some of the differences between an S corporation and an limited liability corporation (LLC) for California franchise and income tax purposes.

 FTB Tax News

Click here to read the November 2015 issue of Tax News with information about upcoming changes to Power of Attorney, MyFTB security considerations and much more. Click here to subscribe to Tax News and Tax News Flashes to automatically receive urgent, time-sensitive information via email.

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BOE News: 

Medical Cannabis – Sellers of medical cannabis, including growers and dispensaries, are required to register with the BOE for a Seller’s Permit. There is no cost to obtain a Seller’s Permit, and sellers may register online.

Proposed Amendments to Regulation 1432 – The BOE proposes to adopt amendments to Regulation 1432, Other Nontaxable Uses of Diesel Fuel in a Motor Vehicle. These amendments update the regulation, including defining “auxiliary equipment” and providing safe-harbor percentages that can be used beginning April 1, 2016 when claiming a refund for diesel fuel used to power auxiliary equipment.

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EDD News: 

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