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Julie Dale, CPA
Texas
Julie Dale, CPA, chair, Federal Tax Policy Communications Subcommittee
Recent Activity
Texas Society of CPAs’ Federal Tax Policy Committee issued a letter to IRS Commissioner John Koskinen raising concerns about recent changes to Internal Revenue Manual (IRM) 8.6.1.4.4. The changes provide discretion for greater involvement by the Examination Division and Office of Chief Counsel in Appeals conferences and may undermine Appeals’ independence, causing taxpayers to lose confidence in the case resolution process. The committee encourages the IRS to clarify and limit the degree of other IRS divisions’ involvement in Appeals conferences, particularly Exam’s involvement, to preserve fair and impartial proceedings. https://www.tscpa.org/docs/default-source/comment-letters/federal-tax-policy/2017/irs-appeals-proceedings---federal-tax-policy.pdf?sfvrsn=2 Continue reading
Posted 5 days ago at TSCPA Federal Tax Policy Blog
Treasury Notice 2017-36 amends and delays for one year, to Jan. 1, 2019, the IRS’ application of final and temporary regulations under Section 385 regarding documentation necessary to determine whether an interest in a corporation is treated as stock or indebtedness for IRC purposes. After taxpayers raised concerns, these regulations were listed in Notice 2017-38 as needing significant revisions pursuant to President Trump’s Executive Order 13789. TSCPA’s Federal Tax Policy Committee issued related comments on June 29, 2016, and again Aug. 2, 2017, on the broad-sweeping changes. Notice 2017-36 also requests comments on whether the amendment and delay provide sufficient... Continue reading
Posted 6 days ago at TSCPA Federal Tax Policy Blog
TSCPA’s Federal Tax Policy Committee has requested to testify at an IRS public hearing on the centralized partnership audit proposed rules on Sept. 18, 2017. David Colmenero, JD, CPA-Dallas, and David Donnelly, CPA-Houston, will travel to Washington, D.C., to represent the committee. In two previous comments letters, the committee encouraged the IRS to make necessary modifications to reduce the administrative burdens on both the IRS and taxpayers and to balance consistency with flexibility. https://www.tscpa.org/docs/default-source/comment-letters/federal-tax-policy/2017/tscpa-request-to-testify-irs-centralized-partnership-audit-regime.pdf?sfvrsn=2 Continue reading
Posted Aug 11, 2017 at TSCPA Federal Tax Policy Blog
By Miguel Reyna, CPA-Dallas The Treasury Inspector General for Tax Administration (TIGTA) published final audit results on July 26, 2017, that found more than $7 billion of potential employer underreported payroll taxes are not being addressed because the IRS did not work the most productive cases. The IRS uses a program called the Combined Annual Wage Reporting (CAWR) to compare the employee wage and withholding information on employer payroll tax forms with the Social Security Administration’s (SSA) withholding documents. According to TIGTA, the program is working effectively in identifying the reporting mismatches. However, 83 percent of the mismatches are not... Continue reading
Posted Aug 8, 2017 at TSCPA Federal Tax Policy Blog
TSCPA’s Federal Tax Policy Committee issued a letter commenting on IRS Notice 2017-38, Implementation of Executive Order 13789 (Identifying and Reducing Tax Regulatory Burdens). The committee agrees the IRS and Treasury should consider two of the eight regulations listed in Notice 2017-38 as overly burdensome to taxpayers: the proposed regulations under Section 2704 on restrictions on liquidation of an interest for estate, gift and generation-skipping transfer taxes and the final and temporary regulations under Section 385 on the property classifications of certain interests in corporations as either stock or indebtedness. The committee also encouraged the government to include in its... Continue reading
Posted Aug 4, 2017 at TSCPA Federal Tax Policy Blog
By William R. Stromsem, JD, CPA On Aug. 1, the IRS will start a pilot program to provide virtual appeals conferences as an alternative to telephone and face-to-face conferences (IR-2017-122). This has great potential to help Texas CPAs and might also cause some possible problems. The IRS plans to use a web-based screen-sharing application similar to online meeting programs that are commercially available for home computers and smart phones. The IRS says the application will have more tools than the current video conference alternative that is only available in a few IRS offices and that would likely be replaced by... Continue reading
Posted Aug 1, 2017 at TSCPA Federal Tax Policy Blog
By Julie Dale, CPA-Austin Revenue Procedure 2017-34 provides a simplified method for certain taxpayers to obtain an extension of time under Section 301.9100-3 of the Procedure and Administration Regulations to make a portability election under Section 2010(c)(5)(A) of the Internal Revenue Code. A portability election allows a decedent’s unused exclusion amount to become available for application to the surviving spouse’s subsequent transfers during life or at death. This election applies to estates of decedents dying after Dec. 31, 2010, if such decedent is survived by a spouse. The simplified method provided in this revenue procedure is to be used in... Continue reading
Posted Jul 27, 2017 at TSCPA Federal Tax Policy Blog
The IRS has started an outreach program for taxpayers with individual tax identification numbers (ITINs) that have expired or are slated to expire at the end of 2017. The IRS is encouraging taxpayers with ITIN middle numbers 70, 71, 72 and 80 (e.g., 9NN-70-NNNN) to submit a renewal application this summer to avoid delays that could affect their tax filing and refunds in 2018. Households with multiple members who have ITINs may be eligible for renewal at the same time even if their ITINs expire at different times. This includes the taxpayer with the expiring ITIN, the taxpayer’s spouse and... Continue reading
Posted Jun 28, 2017 at TSCPA Federal Tax Policy Blog
By Kathy Ploch, CPA-Houston During a recent meeting with TSCPA’s Relations with IRS Committee and other professional organizations, IRS Director of Collection Planning and Performance Analysis Bill Banowsky reported on the status of the private debt collection efforts enacted by Congress in the Fixing America’s Surface Transportation Act of 2015 (FAST Act). The IRS implemented a controlled launch in mid-April of roughly 100 cases per week to four private firms: CBE, ConServe, Performant and Pioneer. The number of transfer cases has gradually increased and will be up to around 2,000 per week by July. The assigned private collection agency (PCA)... Continue reading
Posted Jun 27, 2017 at TSCPA Federal Tax Policy Blog
After Aug. 15, 2017, Pay.gov will be the required payment method for certain types of ruling fees. These rulings include private letter rulings, closing agreements and rulings using: Form 1128 Application to Adopt, Change or Retain a Tax Year, Form 2553 Election by a Small Business Corporation, Form 3115 Application for Change of Accounting Method, or Form 8716 Election to Have a Tax Year Other than a Required Tax Year. Determination letters are not affected since they are addressed to a different division. Below is a link to the payment form listing information needed to process payment and a second... Continue reading
Posted Jun 19, 2017 at TSCPA Federal Tax Policy Blog
By Federal Tax Policy Committee Last month, Jim Smith, CPA-Dallas, TSCPA Chairman Jim Oliver, CPA-San Antonio, and TSCPA Federal Tax Policy Committee Chair Christi Mondrik, JD, CPA-Austin, met with Rostylslav Shiller and Michael Baillif with the IRS Taxpayer Advocate Service (TAS) in Washington, D.C., to discuss issues raised in recent TSCPA Federal Tax Policy Committee letters to the IRS. Focus was primarily on IRS appeals and the “Future State” initiative. The committee members expressed to Shiller and Baillif that the committee shares National Taxpayer Advocate Nina Olson’s concerns regarding IRS funding, the funding of the Taxpayer Advocate’s Office and the... Continue reading
Posted Jun 13, 2017 at TSCPA Federal Tax Policy Blog
IRS Notice CP148 came about as part of the Consolidated Appropriations Act of 2014. Beginning in 2015, address changes made on the Business Master File (BMF) entity with open employment tax filing requirements generates two notices to the taxpayer confirming the change: CP148A is mailed to the taxpayer's new address, and CP148B is mailed to the taxpayer's previous address. Any change to the taxpayer’s address will generate the notices including minor changes such as changing “suite” to “ste.” If the address change is correct, no follow-up action is necessary. If it is not correct, the taxpayer should return the notice... Continue reading
Posted Jun 9, 2017 at TSCPA Federal Tax Policy Blog
On June 1, 2017, the U.S. District Court for the District of Columbia upheld the IRS’ authority to require the use of a preparer tax identification number (PTIN), but enjoined the IRS from charging a user fee for the issuance and renewal of PTINs. The court decided that after the Loving decision took away the IRS’ authority to set criteria for becoming a registered return preparer, there was no longer any rationale for charging a fee because anyone could get a PTIN and obtaining one did not provide a “service or thing of value” for which the IRS could charge... Continue reading
Posted Jun 7, 2017 at TSCPA Federal Tax Policy Blog
The Texas Society of CPAs’ Federal Tax Policy Committee issued a letter to IRS Commissioner John Koskinen regarding preliminary proposed rules for the centralized partnership audit regime (REG 136118-15). As the IRS moves toward reintroducing proposed rules, the committee encourages the IRS to make necessary modifications to reduce the administrative burdens on both the IRS and taxpayers and to balance consistency with flexibility. https://www.tscpa.org/docs/default-source/comment-letters/federal-tax-policy/2017/irs-partnership-audit-regime-letter.pdf?sfvrsn=2 Continue reading
Posted Jun 5, 2017 at TSCPA Federal Tax Policy Blog
The Texas Society of CPAs’ Federal Tax Policy and Relations with IRS Committees provided feedback on preliminary notices related to the IRS’ “future state” plans and requested again that the Treasury Department and the IRS expose those plans for general public and practitioner review and comments. As the IRS moves toward increased use of technology to serve taxpayers, stakeholders should have an opportunity to assist with identifying situations where technology will both benefit taxpayers and make IRS operations more efficient. Doing so would help ensure resources are applied to tools taxpayers and practitioners are likely to use to improve tax... Continue reading
Posted May 15, 2017 at TSCPA Federal Tax Policy Blog
Today, the Texas Society of CPAs issued letters to Senators John Cornyn and Ted Cruz in strong support of S. 540, the Mobile Workforce State Income Tax Simplification Act. This legislation would enhance compliance with state personal income tax and ease the onerous burdens placed on employees who travel outside of their resident states for temporary periods and on employers who have corresponding withholding and reporting requirements. TSCPA and other state CPA societies hope to garner enough support for both the Senate and House version (H.R. 1393) to pass this year. https://www.tscpa.org/docs/default-source/comment-letters/tscpa/senator-letter-on-mobile-workforce-income-tax-simplification.pdf?sfvrsn=2 Continue reading
Posted Apr 27, 2017 at TSCPA Federal Tax Policy Blog
Effective last month, the IRS once again will refer certain federal tax debt to private collectors. Congress enacted this legislation in the Fixing America’s Surface Transportation Act of 2015 (FAST Act). The IRS will send letters to affected taxpayers that their accounts have been assigned to one of the four authorized agencies. Refer to IRS Publication 4518, What You Can Expect When the IRS Assigns Your Account to a Private Collection Agency, for what the agencies can and cannot do. Practitioners should be aware that the IRS anticipates more email and phone tax scams as a result of this program.... Continue reading
Posted Apr 25, 2017 at TSCPA Federal Tax Policy Blog
By Kenneth M. Horwitz, JD, CPA-Dallas; Christina A. Mondrik, JD, CPA-Austin; and William R. Stromsem, JD, CPA IRC section 7345, enacted in the Fixing America’s Surface Transportation Act of 2015 (FAST), provides for revocation of passports or denial of passport applications or renewals for taxpayers who are certified by Treasury to the U.S. State Department to owe more than $50,000 in “seriously delinquent” federal tax debt. The Treasury Department plans to implement the provision this year without requesting public comments. Representing CPAs in a border state, TSCPA’s Federal Tax Policy (FTP) Committee felt compelled to submit two comment letters to... Continue reading
Posted Apr 10, 2017 at TSCPA Federal Tax Policy Blog
Guide to Bond Premium & Market Discount Get the entire article (.PDF) By Corey Junk, Carol Warley, and Stefan Gottschalk, RSM US LLP March 2017 For Publication (by RSM US LLP and on the Federal Tax Policy Blog of the Texas Society of Certified Public Accountants) Introduction: Market Purchases of Bonds, Adjustments to Taxable Income, and Forms 1099. For taxpayers who purchase bonds or other debt instruments (“Bonds”), the Tax Code1 may require adjustments to ordinary interest income. This guide addresses two types of adjustments – bond premium and market discount. Where they apply, the bond premium and market discount... Continue reading
Posted Mar 16, 2017 at TSCPA Federal Tax Policy Blog
In an effort to improve compliance, the Large Business and International Division (LB&I) has announced 13 initiatives where they will focus resources and training. 1. Energy Credits – to verify that the credits are only claimed for energy projects approved by the Department of Energy on which the IRS has approved the allocation of the credit; 2. OVDP Declines-Withdrawals – to identify taxpayers who have misapplied the Offshore Voluntary Disclosure Program (OVDP) because they either were denied access to the program or withdrew from the program; 3. Domestic Production Activities Deduction – a review of multi-channel video programming distributors and... Continue reading
Posted Mar 3, 2017 at TSCPA Federal Tax Policy Blog
By Julie Dale, CPA-Austin As CPAs wishing to assist our clients in the most efficient manner, we often are thwarted with issues in responding to IRS correspondence. One such hurdle is with delays in the IRS’ processing of Form 2848, Power of Attorney and Declaration of Representative. The IRS must have a valid Form 2848 on file for us to obtain the data on our client’s account to resolve a tax notice. The IRS recommends that we fax the Form 2848 to 855-214-7522 (for Texas residents) to expedite processing rather than mailing it. However, even fax is proving to be... Continue reading
Posted Feb 27, 2017 at TSCPA Federal Tax Policy Blog
The new president has issued numerous executive orders during the first weeks of his term. Although these directives commonly occur when the administration changes party affiliation, tax professionals are left wondering if or how they should react. The White House issued a memorandum on Jan. 20, 2017, temporarily freezing new or pending regulations that have not yet become effective. Regulations sent to, but not published in the Federal Register were immediately withdrawn. Regulations published, but not effective were postponed for a 60-day review. The section 385 debt-equity regulations were finalized before the regulatory freezes, so for now, those rules stand.... Continue reading
Posted Feb 20, 2017 at TSCPA Federal Tax Policy Blog
In 2015, TSCPA’s Federal Tax Policy Committee initiated several advocacy efforts for relief of the $100 per day per affected employee penalty to small businesses for health reimbursement arrangements (HRAs) that did not qualify under the Affordable Care Act (ACA) market reform. Two months ago, President Obama signed the 21st Century Cures Act which granted partial relief, the establishment of HRAs for qualified small employers for reimbursements of health insurance and out-of-pocket medical costs (cannot exceed $4,950 individual or $10,000 family) as long as the employee demonstrates to his/her employer that he/she has essential minimum coverage. Reimbursement of Medicare-eligible employees’... Continue reading
Posted Feb 7, 2017 at TSCPA Federal Tax Policy Blog
The IRS has a pilot program for expanded streamline installment agreements that runs September 2016 to September 2017. The SB/SE Campus Collection Operations, including the Automated Collection System (ACS), has expanded installment agreement criteria for individual taxes, self-employment taxes and out-of-business sole proprietors with assessed tax, penalty and interest between $50,000 and $100,000 and from 72 to 84 months automatic installment (if proposed monthly payment is the greater of their total assessed balance divided by 84 months or amount necessary to satisfy the liability before the collection statute expires). If the test is successful, it will provide easier access to... Continue reading
Posted Jan 25, 2017 at TSCPA Federal Tax Policy Blog
We all know that tax preparer firms are under attack from felonious hackers. A security breach can destroy your professional reputation with affected clients and businesses, and possibly your livelihood. If you handle taxpayer information, you may be subject to the Gramm-Leach-Bliley Act and the Federal Trade Commission’s (FTC’s) Financial Privacy and Safeguards Rules, which require that you assess the risks to taxpayer information in your office and have a plan of appropriate protections of that information. Texas also mandates under penalty of law that businesses secure personal data and activate a plan if that data is compromised. The crime... Continue reading
Posted Jan 25, 2017 at TSCPA Federal Tax Policy Blog