Tax News & Views Cranberry Roundup

Relief, Cheers Greet IRS’s Further Delay of New 1099-K Regime - Jonathan Curry and Cady Stanton, Tax Notes($). "Statements of relief abounded as the IRS announced it was delaying — for the second consecutive year — the new $600 threshold for reporting payments by gig economy businesses and other online platforms."

IRS Again Delays $600 Payment Reporting Requirement - Asha Glover, Law360($). "The IRS will push back its implementation of a law requiring peer-to-peer payment platforms such as Venmo and PayPal to report aggregate payments of $600 or more, saying Tuesday that it will instead phase in implementation beginning in 2024 with a $5,000 threshold." 

Mexican Treaty Dual Resident Scores Big Win in FBAR Dispute - Andrew Velarde, Tax Notes ($). "Dual residents with treaty foreign residency are not required to file foreign bank account reports, a court has held in a decision significant to FBAR nonfilers that could also have broad ramifications for expatriation."

Saver’s Credit can help low- and moderate-income taxpayers to save more in 2024 - irs.gov:

The Internal Revenue Service reminds low- and moderate-income taxpayers that they can save for retirement now and possibly earn a special tax credit in 2024 and years ahead.

The Retirement Savings Contributions Credit, also known as the Saver's Credit, helps offset part of the first $2,000 workers voluntarily contribute to Individual Retirement Arrangements (IRAs), 401(k) plans and similar workplace retirement programs. The credit also helps any eligible person with a disability who is the designated beneficiary of an Achieving a Better Life Experience (ABLE) account and makes a contribution to that account. For more information about ABLE accounts, see Publication 907, Tax Highlights for Persons With Disabilities.

IRA Wage and Apprenticeship Proposal May Need More Work - Mary Katherine Browne, Tax Notes ($):

Proposed regulations on the increased credit or deduction amounts available to taxpayers satisfying labor requirements implemented by the Inflation Reduction Act may lead to recordkeeping burdens and regulatory abuse, industry proponents say.

Members of the energy community and labor representatives were front and center in expressing their concerns at a November 21 IRS public hearing on the proposed regs (REG-100908-23) dealing with the prevailing wage and apprenticeship requirements under the IRA’s clean energy provisions.

Triangular Reorganizations and Property Distribution Taxation - Carrie Brandon Elliot, Tax Notes ($):

Taxpayers engaging in triangular reorganizations that involve foreign corporations may be required to treat property transfers as taxable distributions more often under new proposed regs.

Published October 6, proposed regs (REG-117614-14) implement previously announced revisions to reg. sections 1.367(a)-3 and (b)-10. The revisions are intended to prevent tax-free treatment of triangular reorganizations that separate distributed property from the foreign earnings and profits associated with the property.

IRS Doesn’t Need the Blocked Income Regulations in Coca-Cola - Ryan Finley, Tax Notes ($):

The Tax Court’s new opinion deciding the blocked income question raised in Coca-Cola v. Commissioner, T.C. Memo. 2023-135, suggests that Coca-Cola’s prospects of eventual success are dim, whether the blocked income regulations are upheld on appeal or not.

Judge Albert Lauber’s November 8 supplemental opinion in Coca-Cola is the epilogue to the landmark 2020 opinion (155 T.C. 145 (2020)) that handed the IRS a decisive victory in a case concerning transfer pricing method selection.

Yellen Cites IRS Role in Record Fraud Settlement - Alexander Rifaat, Tax Notes ($). "Treasury Secretary Janet Yellen hinted that the extra funds provided to the IRS as part of the Inflation Reduction Act played a crucial role in leading to record fines totaling nearly $4.4 billion levied against Binance, the world’s largest cryptocurrency exchange."

IRS Seeks Help Connecting Taxpayers With Credits, Deductions - Lauren Loricchio, Tax Notes ($):

The IRS is looking for contractors to help it connect taxpayers with the tax credits and deductions for which they are eligible.

A request for information (RFI) published November 17 would support Initiative 1.9 of the IRS’s strategic operating plan, which aims to educate and assist taxpayers in claiming credits and deductions.

Wash. Capital Gains Tax Foes Ask Supreme Court To Void Tax - Jaqueline McCool, Law360 ($):

Washington state's tax on capital gains is an unconstitutional excise tax that exceeds federal limits on state authority, a group opposed to the measure told the U.S. Supreme Court on Tuesday.

In a final reply brief ahead of a scheduled Dec. 8 conference by the Supreme Court, the group of individuals suing the state of Washington to strike down the state's tax on the transfer of capital gains told the court the tax violated the U.S. Constitution. The group argued that the state is exercising improper authority in taxing out-of-state transactions.

Fishing Cos. Tell Justices Chevron Deference 'Deeply Flawed' - Madeline Lyskawa, Law360($):

Fishing company Seafreeze Fleet LLC and its subsidiaries have called on the U.S. Supreme Court to overturn a decades-old doctrine instructing lower courts to defer to federal agencies' interpretations of ambiguous laws, arguing the doctrine is "deeply flawed" by two "significant constitutional shortcomings."

The Chevron deference doctrine — established by the Supreme Court in 1984 in Chevron v. Natural Resources Defense Council  — interferes with judges' duty to apply their own judgment when saying what the law is, as laid out under Article III of the U.S. Constitution, and further violates constitutional due process of law, Seafreeze Fleet, Relentless Inc. and Huntress Inc. told the justices in a brief filed Monday.