| |||
News EssentialsThe Newsroom TopicsIRS Resources | Issue Number: IR-2024-179Inside This IssueTreasury and IRS announce final regulations on how to report and pay the corporate stock repurchase excise tax WASHINGTON — The Department of the Treasury and the Internal Revenue Service today issued final regulations that provide taxpayers and tax professionals with guidance on how to report and pay the 1 percent excise tax owed on corporate stock repurchases. The Inflation Reduction Act imposed a new excise tax on stock repurchases equal to 1 percent of the aggregate fair market value of stock repurchased by certain corporations during the taxable year, subject to adjustments. The stock repurchase excise tax applies to repurchases after Dec. 31, 2022. These final regulations require that the stock repurchase excise tax be reported on Form 720, Quarterly Federal Excise Tax Return, due for the first full calendar quarter after the end of the corporation's taxable year, with the Form 7208, Excise Tax on Repurchase of Corporate Stock, attached. The Form 7208 is used to figure the amount of stock repurchase excise tax owed. Forms 720 and 7208 due for taxable years ending after Dec. 31, 2022, and on or before June 30, 2024, must be filed by the third quarter due date for Form 720, which is Oct. 31, 2024. If a corporation has more than one taxable year ending after Dec. 31, 2022, and on or before June 30, 2024, the corporation should file a single Form 720 with two separate Forms 7208 (one for each taxable year) attached by Oct. 31, 2024. The final regulations affect publicly traded domestic corporations that repurchase their stock or whose stock is acquired by certain affiliates after Dec. 31, 2022. The regulations also affect certain publicly traded foreign corporations that repurchase their stock or whose stock is acquired by certain affiliates after Dec. 31, 2022. More information can be found on the Inflation Reduction Act of 2022 page on IRS.gov. 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, June 28, 2024
IR-2024-179: Treasury and IRS announce final regulations on how to report and pay the corporate stock repurchase excise tax
IR-2024-178: Treasury, IRS issue final regulations requiring broker reporting of sales and exchanges of digital assets that are subject to tax under current law, additional guidance to provide penalty relief, address information reporting and other technical issues
| |||
News EssentialsThe Newsroom TopicsIRS Resources | Issue Number: IR-2024-178Inside This IssueTreasury, IRS issue final regulations requiring broker reporting of sales and exchanges of digital assets that are subject to tax under current law, additional guidance to provide penalty relief, address information reporting and other technical issues WASHINGTON — The U.S. Department of the Treasury and the Internal Revenue Service today issued final regulations requiring custodial brokers to report sales and exchanges of digital assets, including cryptocurrency. These reporting requirements will help taxpayers to file accurate tax returns with respect to digital asset transactions, which are already subject to tax under current law. These final regulations reflect consideration of more than 44,000 public comments received last fall on the proposed regulations. They require brokers to report certain sale and exchange transactions that take place beginning in calendar year 2025 and will be reported on the soon-to-be released Form 1099-DA. The regulations implement reporting requirements by the Infrastructure Investment and Jobs Act, enacted in 2021. "We reviewed thousands of public comments and believe this new guidance addresses those concerns while striking a balance between industry implementation challenges and closing the tax gap related to digital assets," said IRS Commissioner Danny Werfel. "These regulations are an important part of the larger effort on high-income individual tax compliance. We need to make sure digital assets are not used to hide taxable income, and these final regulations will improve detection of noncompliance in the high-risk space of digital assets. Our research and experience demonstrate that third-party reporting improves compliance. In addition, these regulations will provide taxpayers with much needed information, which will reduce burden and simplify the process of reporting their digital asset activity." "Our work to address potential non-compliance in digital currency is another reason why it is so critical to fully fund IRS operations," Werfel added. "These new assets expand the complexity of our tax system, and the technology and personnel necessary for the IRS to keep pace with these changes is resource intensive. Ultimately, this IRS funding helps address emerging issues and creates significantly more savings than costs to the government's bottom line." The final regulations require reporting by brokers who take possession of the digital assets being sold by their customers. These brokers include operators of custodial digital asset trading platforms, certain digital asset hosted wallet providers, digital asset kiosks, and certain processors of digital asset payments (PDAPs). The majority of digital asset transactions today occur using these brokers. By focusing first on this group, the IRS intends these regulations to cover the greatest number of taxpayers while allowing the IRS and U.S. Treasury Department more time to consider the nuances of transactions involving non-custodial and decentralized brokers. The final regulations do not include reporting requirements for brokers that do not take possession of the digital assets being sold or exchanged. These brokers are commonly called decentralized or non-custodial brokers. The U.S. Treasury Department and the IRS intend to provide rules for these brokers in a different set of final regulations. In addition to the broker reporting rules, the regulations provide rules for taxpayers to determine their basis, gain, and loss from digital asset transactions. The regulations also provide backup withholding rules. The IRS is aware of the challenges that implementing new reporting requirements can pose, which is why the agency is also providing transitional and penalty relief from reporting and backup withholding rules on certain transactions to help phase-in implementation. Real estate professionals are also required to report the fair market value of digital assets paid by buyers and received by sellers in real estate transactions with closing dates on or after January 1, 2026. The final regulations provide for an optional, aggregate reporting method for certain sales of stablecoins and certain non-fungible tokens (NFTs) applicable only after sales of these stablecoins and NFTs exceed de minimis thresholds. For PDAP transactions, the regulations require reporting on a transactional basis only if the customer's sales are above a de minimis threshold. Finally, basis reporting will be required by certain brokers, for transactions occurring on or after January 1, 2026. Additional guidance to provide transitional relief regarding digital asset transactions includes: Transitional relief Notice 2024-56 provides general transitional relief from reporting penalties and backup withholding for any broker who does not timely and accurately file information returns and furnish payee statements for sales and exchanges of digital assets during calendar year 2025, provided that the broker makes a good faith effort to comply with the reporting obligations. Additionally, the Notice provides more limited relief from backup withholding for certain sales of digital assets during 2026 for brokers using the IRS's TIN-matching system in place of certified TINs. Finally, the Notice also provides backup withholding relief for exchanges of digital assets in return for specified NFTs and real property and for certain sales effected by PDAPs. Delay on information reporting for certain transactions until future guidance is issued Notice 2024-57 informs brokers that until the U.S. Treasury Department and the IRS issue further guidance, brokers will not have to file information returns or furnish payee statements on digital asset sales and exchanges for the following six types of transactions:
Transition from universal or multi-wallet approach to allocating basis in digital assets to wallet by wallet or account by account approach. Revenue Procedure 2024-28 generally permits taxpayers to rely on any reasonable allocation of units of unused basis to wallets or accounts that hold the same number of remaining digital asset units based on the taxpayers' records of unused bases and remaining units in those wallets or accounts. 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. |
Update your subscriptions, modify your password or email address, or stop subscriptions at any time on your Subscriber Preferences Page. You will need your email address to log in. If you have questions or problems with the subscription service, visit subscriberhelp.govdelivery.com. This service is provided to you at no charge by the Internal Revenue Service (IRS). |
IR-2024-177: IRS: Marijuana remains a Schedule I controlled substance; Internal Revenue Code Section 280E still applies
| |||
News EssentialsThe Newsroom TopicsIRS Resources | Issue Number: IR-2024-177Inside This IssueIRS: Marijuana remains a Schedule I controlled substance; Internal Revenue Code Section 280E still applies WASHINGTON — Until a final federal rule is published, the Internal Revenue Service today reminded taxpayers that marijuana remains a Schedule I controlled substance and is subject to the limitations of Internal Revenue Code. The law with respect to the schedule or classification of marijuana has not changed. Taxpayers seeking a refund of taxes paid related to Internal Revenue Code Section 280E by filing amended returns are not entitled to a refund or payment. Although the law has not changed, some taxpayers are filing amended returns. The grounds for filing such claims vary, but these claims are not valid. The IRS is taking steps to address these claims. Section 280E disallows all deductions or credits for any amount paid or incurred in carrying on any trade or business that consists of illegally trafficking in a Schedule I or II controlled substance within the meaning of the federal Controlled Substances Act. This applies to businesses that sell marijuana, even if they operate in states that have legalized the sale of marijuana. Section 280E does not, however, prohibit a participant in the marijuana industry from reducing its gross receipts by its properly calculated cost of goods sold to determine its gross income.u On May 21, 2024, the Justice Department published a notice of proposed rulemaking with the Federal Register to initiate a formal rulemaking process to consider rescheduling marijuana under the Controlled Substances Act. Until a final rule is published, marijuana remains a Schedule I controlled substance and is subject to the limitations of Internal Revenue Code Section 280E. The IRS has an existing set of frequently asked questions and other information related to the cannabis industry on IRS.gov. 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. |
Update your subscriptions, modify your password or email address, or stop subscriptions at any time on your Subscriber Preferences Page. You will need your email address to log in. If you have questions or problems with the subscription service, visit subscriberhelp.govdelivery.com. This service is provided to you at no charge by the Internal Revenue Service (IRS). |
IRS video tax tip: Part-Time and Seasonal Jobs
| |||
Useful Links:News EssentialsThe Newsroom TopicsIRS Resources
| Issue Number: Part-Time and Seasonal JobsHere is a video tax tip from the IRS: Part-Time and Seasonal Jobs English | ASL Subscribe today: The IRS YouTube channels provide short, informative videos on various tax related topics.
Thank you for subscribing to IRS Tax Tips, an IRS e-mail service. For more information on federal taxes please visit IRS.gov. This message was distributed automatically from the IRS Tax Tips mailing list. Please Do Not Reply To This Message. |
Update your subscriptions, modify your password or email address, or stop subscriptions at any time on your Subscriber Preferences Page. You will need your email address to log in. If you have questions or problems with the subscription service, visit subscriberhelp.govdelivery.com. This service is provided to you at no charge by the Internal Revenue Service (IRS). |
IRS reminds FATCA users of July 1 Responsible Officer Certifications and Upcoming FATCA Registration System Enhancements
Having trouble viewing this email? View it as a Web page.
| |||
Useful Links:News EssentialsIRS Resources | Issue Number: 2024-12Inside This Issue
1. Reminder: For the FATCA Certification Period Ending December 31, 2023, Responsible Officer Certifications are due by July 1, 2024 For the certification period ending December 31, 2023, FATCA Responsible Officer ("RO") certifications are due no later than July 1, 2024. If an entity that is required to certify does not submit its certifications by the due date, the entity will not be in compliance with its obligations under FATCA. The consequences of being non-compliant may include the revocation of an entity's FATCA status and, ultimately, the entity's GIIN being removed from the FFI list.
2. Upcoming Enhancements to the FATCA Registration System The Internal Revenue Service will soon be announcing changes to the login process of the FATCA Registration system. To prepare for these upcoming system enhancements to the FATCA Registration system, the IRS requests that Responsible Officers log in to their accounts on the FATCA Registration system to verify that the contact information is correct. Please verify and update your FATCA registration information including email, phone number, and address for the Responsible Officer (RO) and Point of Contact (POC) listed.
Thank you for subscribing to FATCA News & Information, an IRS e-mail service. For more information on federal taxes please visit IRS.gov. This message was distributed automatically from the FATCA News & Information mailing list. Please Do Not Reply To This Message. |
Update your subscriptions, modify your password or email address, or stop subscriptions at any time on your Subscriber Preferences Page. You will need your email address to log in. If you have questions or problems with the subscription service, visit subscriberhelp.govdelivery.com. This service is provided to you at no charge by the Internal Revenue Service (IRS). |