Tax News & Views Story Time Roundup

Telling a Tax Story - Chris Cioffi, Bloomberg ($) (scroll down):

Companies should be ready to tell their tax story as the House Ways and Means Committee begins looking toward the coming 2025 tax overhaul when it holds hearings on expiring provisions from the 2017 tax law, said Scott McCandless, a principal at PwC’s Tax Policy Services Practice.

“Those hearings are an opportunity to provide input to the committee on aspects of the tax code that are working and those that may need improvement,” he said in a video the firm published April 19.

What’s going on:

The House Ways and Means Committee will soon announce “Tax Teams.” These teams will be comprised of committee members who will focus on certain, expiring TCJA (Tax Cuts and Jobs Act) provisions and determine if the measures should stay, go, or be amended.

These teams are expected to hold several hearings this year on their tax subject. Eide Bailly has been in contact with the Committee about participating in these hearings.

Thousands Are Eligible for Tax Refunds From 2020 – Ann Carrns, New York Times:

Who wouldn’t grab an income tax refund if they had one coming?

About 940,000 people, it turns out — because they haven’t filed returns for the 2020 tax year, even though they may be due money back for that year. But there’s still close to a month left to file and collect the refunds. The Internal Revenue Service estimates that the typical refund for the people in this group is more than $900.

BTW, we’re experts at getting you your money.

Let us help you relieve your tax headache - Eide Bailly:

Federal, state, local, and international tax burdens and responsibilities consume time and cash flow. Whether you’re an individual, a business, a nonprofit, or handling a trust or estate, proper planning and guidance from a well-versed professional can make managing taxes less painful.

Eide Bailly has the depth of tax resources to help you gain peace of mind. Plus, our professionals are supported by the National Tax Office, allowing clients to dig into specialized tax situations.

We can also help with this:

Missed the April tax-filing deadline? File quickly to avoid penalties and interest; those owed a refund also shouldn’t forget to file – IRS:

The Internal Revenue Service today encouraged taxpayers who missed the April tax-filing deadline to file a tax return as soon as they can.

The IRS offers different resources to help those who may be unable to pay their tax bill in total. Those who missed the deadline to file but owe taxes should file quickly to minimize penalties and interest.

Reg Updates

IRS Employee Retention Credit compliance effort tops $1 billion threshold since fall; Voluntary Disclosure Program suspended after March 22, special withdrawal program remains open as audits, investigations intensify – IRS:

The Internal Revenue Service announced today that compliance efforts around erroneous Employee Retention Credit (ERC) claims have topped more than $1 billion so far since last fall as work continues on a number of efforts to counter questionable claims pushed by aggressive marketing, including an aggressive push on claims made for 2021.

“The IRS has made important progress in our compliance efforts protecting more than $1 billion in revenue in just six months, but we remain deeply concerned about widespread abuse involving these claims that have harmed small businesses,” said IRS Commissioner Danny Werfel. “We are encouraged by the results so far of our initiatives designed to help misled businesses, and the IRS will continue our broader compliance work given the aggressive marketing we’ve seen with this credit.”

IRS Previews New Digital Assets Reporting Form – Kat Lucero, Law360 Tax Authority ($):

The Internal Revenue Service released a draft of a form brokers will have to use for the first time to disclose their digital asset sales to the agency, including instructions for taxpayers whose transactions are subject to the reporting requirements.

The draft Form 1099-DA, posted Thursday, will apply to those who meet the definition of digital asset brokers under rules the agency proposed in August. In the draft, the IRS asked filers to report whether the broker is a kiosk operator, digital asset payment processor, hosted or unhosted wallet provider or another type of broker involved in the reported transactions.

Repeat: This is a “draft,” which is here.

Elective Payment of Advanced Manufacturing Investment Credit; Correction – Federal Register. “This document contains corrections to Treasury Decision 9989, which was published in the Federal Register for Monday, March 11, 2024. Treasury Decision 9989 issued final regulations concerning the elective payment election of the advanced manufacturing investment credit under the Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act of 2022.”

Court Side

Atty In Tax Fraud Case Gets Supervised Release, $25K Fine – Catherine Marfin, Law360 Tax Authority ($):

A former Houston lawyer whose conviction in connection with an $18 million tax scheme was overturned told a federal judge Friday that not testifying in his 2019 trial was "one of the worst mistakes" of his life as he was sentenced to a year of supervised release as part of a plea deal.

"There are exceptions to just about everything I've pled," [The defendant] told U.S. District Judge Gray H. Miller at a one-hour sentencing hearing Friday.

Seventh Circuit Flushes District Court in Olson Injunction Battle - Leslie Book, Tax Notes ($). "When recalcitrant taxpayers fail to pay hundreds of thousands of dollars in income and employment taxes, the government can use multiple tools to encourage future compliance and attempt to collect on a debt. In United States v. Olson, No. 23-1864 (7th Cir. 2024), the Seventh Circuit explores the use of one of those tools, a civil injunction. The case is noteworthy as it reflects a concise and pointed reversal of a district court judge’s view, which, if adopted broadly, would have restricted the government’s ability to use the injunction power against delinquent taxpayers."

Utah Charity Leader Gets Year In Prison For $1.3M Tax Evasion – Anna Scott Farrell, Law360 Tax Authority ($):

The former head of a Utah charity was sentenced to a year and a day in prison for evading taxes on $1.3 million he was paid as part of a covert arrangement with a purported donor, according to documents filed in a Utah federal court.

[The defendant], ex-CEO of Globus Relief, a Salt Lake City-based charity that collected medical supplies and distributed them overseas, was also ordered to pay nearly $486,000 in restitution to the Internal Revenue Service, according to court documents.

FedEx-Shipped Tax Court Petition Deemed Late Under Mailing Rules - John Woolley, Bloomberg ($):

The US Tax Court dismissed as untimely a lawsuit to redetermine a taxpayer’s federal liabilities, holding that his shipping service didn’t qualify for an exemption requiring the court to treat his petition’s mailing date as its filing date.

[The defendant] used FedEx “Express Saver” to ship his petition to the US Tax Court on Jan. 22, the same day the petition was due. The court received and filed that petition two days later, making it late filed and therefore outside the court’s jurisdiction to consider, Chief Judge Kathleen Kerrigan wrote Thursday.

BOI region

Updated FAQs provide details on phase-in timing of BOI access - Martha Waggoner, The Tax Advisor:

Updated FAQs on beneficial ownership information (BOI) from Treasury's Financial Crimes Enforcement Network (FinCEN) include details on the timing of the phase in of access to BOI under Section 6403 of the Corporate Transparency Act (CTA), P.L. 116-283…

Access will be phased in, beginning this spring with a pilot program for some federal agency users and concluding in spring 2025, when financial institutions with customer due-diligence requirements will be able to review BOI.

A link to reporting process is here.

The FAQ is here.

International Zone

India's income tax receipts up 17.7% yr/yr in 2023/24, near $235 bln – Manoj Kumar, Reuters:

Income tax receipts in India, comprising personal and corporate levies, rose 17.7% year-on-year to nearly $235 billion in the 2023/24 financial year ending in March, reflecting the rising incomes of rich taxpayers and corporate profits.

Net income tax receipts for the 2023/24 financial year ending in March rose to 19.58 trillion rupees ($234.9 billion), up from 16.64 trillion in the previous financial year, the Central Board of Direct Taxes (CBDT) said on Sunday.

Protecting the U.S. Tax Base: Questions About Cost Sharing – Mindy Herzfeld, Tax Notes ($):

Transfer pricing — the mechanism devised by lawmakers and international tax bureaucrats for allocating multinationals’ costs and revenues across jurisdictions — is a term often used pejoratively. It frequently takes the blame for the inability of developing countries to raise enough revenue to meet their many needs and is often preceded by the adjective harmful…

In the United States, a specific type of transfer pricing rule is most often singled out. Economist Stephen L. Curtis recently testified before the Senate Budget Committee that poor IRS enforcement of the adjustments required by cost-sharing arrangements (CSAs) — sanctioned by the government in reg. section 1.482-7 — is responsible for at least $600 billion of the U.S. deficit…

Questions Loom Over China's Pillar 2 Participation – Dylan Moroses, Law360 Tax Authority ($). “China has not adopted the OECD's global minimum tax, called Pillar Two of the group's global tax overhaul. But tax policy experts warned that even if the country were to do so, some of its biggest companies could retain a competitive advantage because of their corporate structures and from Chinese subsidies treated preferentially under the tax.”

From the “Winner, Winner, Chicken Dinner” file

Biden Unveils Winners of $2 Billion in Green Tax Credits - Ari Natter and Josh Saul, Bloomberg ($):

Battery-material maker Novonix, electric vehicle charger manufacturer Wallbox and rare earth producer MP Materials Corp. were among about 35 recipients of clean energy tax credits totaling nearly $2 billion that were announced Friday by the Biden administration.

The credits announced by the Energy Department are part of a program for clean energy manufacturers that received $10 billion through President Joe Biden’s signature climate law, the Inflation Reduction Act. They provide investment tax credits of as much as 30% for technologies that accelerate clean energy manufacturing and reduce greenhouse gas emissions at industrial facilities.

Wanna join the game? We can help!

Maximize The Benefit of Renewable Tax Credits – Eide Bailly. "The Inflation Reduction Act (IRA) has incentivized the climate economy and boosted clean energy investments. By lowering the financial burden and making it more economically viable to invest in renewable energy solutions, renewable tax credits can help organizations accelerate their return on investment and meet sustainability goals. Our advisors can help you maximize the tax benefit of investing in clean energy."

What Day Is It?

Happy Earth Day! Remember, it’s a movement, not a day!