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News EssentialsThe Newsroom TopicsIRS Resources | Issue Number: IR-2024-86Inside This IssueIRS and Treasury issue guidance for solar and wind powered energy facilities in low-income communities under the Inflation Reduction Act WASHINGTON — The Department of the Treasury and the Internal Revenue Service today issued Revenue Procedure 2024-19 to provide guidance for owners of certain solar or wind facilities built in connection with low-income communities. The guidance issued today provides important clarifying changes to the application and documentation requirements for the 2024 program year. In addition, this revenue procedure provides how the Capacity Limitation for the 2024 program year will be divided across facility categories described and the additional selection criteria application options. The Inflation Reduction Act added section 48(e) to the federal tax law to provide for an increase in the energy investment credit for solar and wind facilities that apply for and receive an allocation of environmental justice solar and wind capacity limitation. Taxpayers that receive an allocation and properly place the facility in service may then claim the increased energy investment credit in the year that the facility is placed in service. The final regulations provide definitions and requirements for the program. The regulations state the four project categories under which facilities apply for an allocation, and the increase of either 10% or 20% associated with a project category. Additionally, the regulations:
Revenue Procedure 2023-27 provided procedures for applicants for the 2023 program year. Soley with respect to the 2024 program year, today's guidance supersedes Revenue Procedure 2023-27. The Treasury Department and IRS also released Notice 2023-17 on Feb. 13, 2023, to establish the Low-Income Communities Bonus Credit Program. Notice 2023-17 provided initial guidance for potential applicants seeking allocations of calendar year 2023 environmental justice solar and wind capacity limitation. Thank you for subscribing to the IRS Newswire, an IRS e-mail service. If you know someone who might want to subscribe to this mailing list, please forward this message to them so they can subscribe. This message was distributed automatically from the mailing list IRS Newswire. Please Do Not Reply To This Message. |
Friday, March 29, 2024
IR-2024-86: IRS and Treasury issue guidance for solar and wind powered energy facilities in low-income communities under the Inflation Reduction Act
e-News for Small Business Issue 2024-06
7 ERC warning signs; filing season info; digital assets
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Tax Resources for Small BusinessSmall Business Self-Employment Center Small Business Forms & Instructions Small Business Tax Workshops, Meetings and Seminars Self-Employed Individuals Tax Center Other ResourcesForms, Instructions & Publications Retirement Plans for Small Entities and Self-Employed Tax Information for Charities
| Issue Number: 2024-06Inside This Issue
1. Seven warning signs of incorrect Employee Retention Credit claims; aggressive ERC promotion makes 2024 IRS Dirty Dozen listThe IRS encourages businesses to review Employee Retention Credit claims and see if the agency's special programs can help them avoid future compliance issues. The deadline of March 22 for employers to correct improper ERC claims has passed, but the IRS reminds businesses of a special claim withdrawal process for businesses whose claim is still pending. The IRS included warnings about aggressive ERC marketing and making improper claims as part of the agency's annual Dirty Dozen list of tax scams. Taking steps now to resolve these issues can help businesses get right and avoid future IRS action, and the agency urged businesses to immediately seek the help of a trusted tax professional to get help. 2. Important tax filing season informationAvoid tax return mistakes, delays and refund adjustments with these tips As the April 15 filing deadline approaches, the IRS reminds taxpayers about ways to prevent typical errors on federal tax returns to help speed potential refunds.
Prevent penalties and interest with electronic filing and payment options Taxpayers, regardless of income, who need more time to file a return can use IRS Free File to electronically file for a six-month extension before April 15, 2024. An extension will help to avoid penalties and interest for failing to file on time, and gives taxpayers until Oct. 15, 2024, to file. However, they still must pay what they owe by the April 15 deadline and are encouraged to use electronic payment options to further avoid late filing and interest penalties. Tell employees about IRS Direct File, now open in 12 pilot states The IRS has fully launched its Direct File pilot and is asking businesses to encouraged eligible employees in 12 states to try the new service to file their tax returns online for free directly with the IRS. Pilot states include: Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington State and Wyoming. The early results from Direct File have shown taxpayers like the ease and convenience of the tool, and moving into the full-scale launch of the pilot will give more taxpayers the chance to use this free option," said IRS Commissioner Danny Werfel. Tips for success using Direct File is available on IRS.gov. 3. Businesses should report digital asset transactions and other incomeThe IRS reminds businesses that they're generally required to report all earned income on their tax return, including income earned from digital asset transactions, the gig economy, service industry and foreign sources. The redesigned Digital Assets page on IRS.gov features:
More information: Frequently Asked Questions on Virtual Currency Transactions 4. Treasury, IRS finalize rules on elective payments of certain clean energy creditsThe Department of the Treasury and IRS issued final regulations for applicable entities that earn certain clean energy credits and choose to make an elective payment election. For tax years beginning after Dec. 31, 2022, applicable entities can choose to make an elective payment election, which will treat certain clean energy credits as a payment against their federal income tax liabilities rather than as a nonrefundable credit. This payment will first offset any income tax liability of the applicable entity and any excess is refunded to the applicable entity. 5. IRS has many resources in multiple languagesThe IRS reminds businesses and individuals that the agency continues to increase the amount of information available in multiple languages. On IRS.gov, much of the information has been translated into seven languages other than English. Taxpayers can choose their preferred language from the dropdown menu at the top of the page, including Spanish, Vietnamese, Russian, Korean, Haitian Creole, Traditional Chinese and Simplified Chinese. The Languages page also gives taxpayers key topics related to federal taxes in 21 languages. Topics include:
6. Registration open for 2024 IRS Nationwide Tax ForumRegistration for the IRS's 2024 Nationwide Tax Forum is now open. The forum provides tax professionals the opportunity to attend continuing education sessions this summer in five U.S. cities. This event offers continuing education and networking opportunities to enrolled agents, certified public accountants, attorneys and other tax professionals who serve businesses, individuals and other entities. Attendees may earn up to 18 continuing education credits. 7. Other tax newsThe following information may be of interest to individuals and groups in or related to small businesses:
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IRS video tax tip: Here's What To Do if You Owe Taxes, but Can't Pay
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| Issue Number: Here's What To Do if You Owe Taxes, but Can't PayHere is a video tax tip from the IRS: Here's What To Do if You Owe Taxes, but Can't Pay English | Spanish | ASL Subscribe today: The IRS YouTube channels provide short, informative videos on various tax related topics.
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IR-2024-85: Dirty Dozen: Beware of aggressive promoters who dupe taxpayers into making questionable Employee Retention Credit claims; risks continue for small businesses, special withdrawal program remains available
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News EssentialsThe Newsroom TopicsIRS Resources | Issue Number: IR-2024-85Inside This IssueDirty Dozen: Beware of aggressive promoters who dupe taxpayers into making questionable Employee Retention Credit claims; risks continue for small businesses, special withdrawal program remains available WASHINGTON — As part of this year's Dirty Dozen, the Internal Revenue Service continues to warn businesses and others to stay clear of unscrupulous and aggressive promoters of questionable claims for the Employee Retention Credit (ERC). These questionable ERC claims often put unsuspecting businesses and other entities in jeopardy of penalties, interest and potentially even criminal prosecution for claiming the ERC when they don't qualify and aren't entitled to it. In day two of the Dirty Dozen series, this latest warning comes as the IRS continues to take special steps to counter aggressive marketing around the ERC, sometimes referred to as the Employee Retention Tax Credit or ERTC. Since the IRS announced a moratorium on processing new claims filed after Sept. 14, 2023, the agency's compliance efforts on 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. With compliance work on ERC claims continuing to expand through both audits and criminal investigations, the IRS reminded businesses they still have an option to pull back on any unprocessed claims. Businesses should quickly pursue the claim withdrawal process if they need to ask the IRS not to process an ERC claim for any tax period that hasn't been paid yet. While this work continues, the IRS continues to urge businesses to carefully review the complex ERC guidelines before submitting a claim. The IRS remains concerned that some ineligible businesses are being encouraged by marketers to submit an incorrect ERC claim; people should contact a trusted tax professional first to avoid potential IRS compliance action in the future. "We remain concerned that unscrupulous promoters and numerous myths about eligibility for this credit could put well-meaning businesses at risk," said IRS Commissioner Danny Werfel. "Before anyone files an Employee Retention Credit claim, they should carefully review the eligibility guidelines and talk to a trusted tax professional. Relying on a marketer who is looking to take a hefty percentage fee of the potential claim adds risk for well-meaning businesses given the ongoing IRS compliance work." The IRS took significant compliance steps regarding the ERC program after the well-intentioned pandemic-era program came under aggressive, misleading marketing that oversimplified or misrepresented eligibility rules. Promoters pushed more applicants into the program, frequently by taking a percentage of the payout. When properly claimed, the ERC is a refundable tax credit designed for businesses that continued paying employees during the COVID-19 pandemic while their business operations were either fully or partially suspended due to a government order, or had a decline or significant decline in gross receipts during the eligibility periods. Started in 2002, the IRS' annual Dirty Dozen campaign lists 12 scams and schemes that put taxpayers, businesses and the tax professional community at risk of losing money, personal information, data and more. While the Dirty Dozen is not a legal document or a formal listing of agency enforcement priorities, the education effort is designed to raise awareness and protect taxpayers and tax pros from common tax scams and schemes. ERC withdrawal program This withdrawal option allows certain employers that filed an ERC claim but have not yet received a refund to withdraw their submission and avoid future repayment, interest and penalties. Employers that submitted an ERC claim that have not yet been paid can withdraw their claim and avoid the possibility of getting a refund for which they're ineligible. They can also withdraw their claim if they've received a check but have not yet deposited or cashed it. The IRS created the withdrawal option to help small business owners and others who were pressured or misled by ERC marketers or promoters into filing ineligible claims. Claims that are withdrawn will be treated as if they were never filed. The IRS will not impose penalties or interest. The IRS continues to encourage employers who submitted claims to review the ERC requirements and talk to a trusted tax professional about their eligibility amid misleading marketing around the credit. For more information on ERC eligibility, taxpayers can see the ERC frequently asked questions and the ERC Eligibility Checklist, which is available as an interactive tool or as a printable guide. Signs an ERC claim could be incorrect The agency shared suspicious warning signs that could signal future IRS problems involving ERC claims. Built on feedback from the tax professional community and IRS compliance personnel, the warning signs center on misinformation some unscrupulous ERC promoters used. Here are common red flags IRS is seeing on ERC claims:
Help for businesses that may have been misled on the ERC
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