- The IRS announced applications for the 2021 Compliance Assurance Process (CAP) program are due beginning 1 September 2020 and ending 13 November 2020.
- An IRS practice unit focuses on the foreign-earned income of individuals for purposes of section 911.
- The U.S. Tax Court held that the taxpayer’s gross receipts from the leasing of processed marine seismic data during 2008 were not eligible for the then-available deduction under section 199(c)(5). (Section 199 was repealed for tax years beginning after 31 December 2017 by the 2017 tax law.)
- U.S. Senate Finance Committee leaders released a report on their investigation into the abuse of syndicated conservation-easement transactions—expressing a belief that Congress, the IRS, and the Treasury Department need further action to preserve the integrity of the conservation-easement tax deduction.
- OMB’s Office of Information and Regulatory Affairs (OIRA) completed its review of final regulations under section 59A—the “base erosion and anti-abuse tax” or “BEAT” provisions that were enacted as part of the 2017 tax law. Treasury and the IRS can now be expected to release these final regulations for publication in the Federal Register—the exact date of publication not being known.
- An IRS memorandum provides interim guidance for IRS field personnel on the criteria to be applied and the process to be used when considering requests for designation of issues (cases) for litigation made to the Office of Chief Counsel.
- An IRS release reminds individual taxpayers that the deadline to rollover or repay retirement plan “required minimum distributions” is 31 August 2020. Certain required minimum distributions that are not rolled over or repaid could be subject to income tax.
- A KPMG report on Joe Biden’s possible federal tax agenda was updated to include a new “frequently asked question” (FAQ): Could legislation be enacted increasing tax rates retroactively?
- The IRS announced relief for taxpayers affected by the California wildfires and for taxpayers affected by the derecho in Iowa. In general, tax returns and tax payments with a 15 October 2020 due date are postponed to 15 December 2020.
State and local tax updates
- Tax authorities in Hawaii, Montana, New Hampshire, and Ohio released guidance to provide tax relief in response to the COVID-19 pandemic.
- Arizona’s Supreme Court held a ballot initiative that would impose a 3.5% income tax surcharge on taxable income above $250,000 annually for single persons or married persons filing separately, and on taxable income above $500,000 annually for married persons filing jointly (with the revenue raised to fund an education initiative) was eligible to be placed on the November 2020 ballot for consideration by the voters.
- Nebraska’s Supreme Court held that a contractor specializing in building and maintaining cellular towers, transmission lines, and other improvements at cellular sites was liable for uncollected sales tax on its service receipts The Tennessee Department of Revenue issued guidelines concerning the use of IRC section 163(j) interest-expense carryforwards for tax years beginning on or after 1 January 2020 (when Tennessee decoupled from section 163(j) and no longer limits the deduction for interest expense).
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