QuickAlerts – Technical – Form 1040 Series Schema are Available.

Subject: Form 1040 Series Schema are Available.

Attention: Software Developers, Return Transmitters and Authorized IRS e-File Providers/EROs

Tax Year 2021 / Processing Year 2022 Schema Only

Form 1040 Series 2021v5.4

Software Developers and State organizations may download Modernized e-File (MeF) schemas and business rules from their e-Services mailbox. To access these files, you must have:

An active e-Services account
An e-File application with the Software Developer or State provider option with the associated tax type of 1040, 2350, 4868, 56 or 9465

Please visit the Modernized e-File (MeF) Schemas and Business Rules page on IRS.gov for more information about MeF Schemas and Business Rules.

You may have several messages in your account. Please open all of them to find the set you would like to download. After 60 days the messages are purged. If you have the appropriate role and do not have these files available for download within 48 hours, please contact the MeF Mailbox with the Company Name, ETIN and Schema Package(s) with Tax Year needed.

IR-2023-193: IRS announces withdrawal process for Employee Retention Credit claims; special initiative aimed at helping businesses concerned about an ineligible claim amid aggressive marketing, scams

Issue Number: IR-2023-193

Inside This Issue

IRS announces withdrawal process for Employee Retention Credit claims; special initiative aimed at helping businesses concerned about an ineligible claim amid aggressive marketing, scams

WASHINGTON – As part of a larger effort to protect small businesses and organizations from scams, the Internal Revenue Service today announced the details of a special withdrawal process to help those who filed an Employee Retention Credit (ERC) claim and are concerned about its accuracy.

This new 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’s still being processed can withdraw their claim and avoid the possibility of getting a refund for which they’re ineligible.

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 Claims that are withdrawn will be treated as if they were never filed.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.

Those who willfully filed a fraudulent claim, or those who assisted or conspired in such conduct, should be aware that withdrawing a fraudulent claim will not exempt them from potential criminal investigation and prosecution.

“The IRS is committed to helping small businesses and others caught up in this onslaught of Employee Retention Credit marketing,” said IRS Commissioner Danny Werfel. “The aggressive marketing of these schemes has harmed well-meaning businesses and organizations, and some are having second thoughts about their claims. We want to give these taxpayers a way out. The withdrawal option allows employers with pending claims to avoid future problems, and we encourage them to closely review the withdrawal option and the requirements. We continue to urge taxpayers to consult with a trusted tax professional rather than a marketing company about this complex tax credit.”

When properly claimed, the ERC – also referred to as the Employee Retention Tax Credit or ERTC – is a refundable tax credit designed for businesses that continued paying employees during the COVID-19 pandemic while their business operations were fully or partially suspended due to a government order, or they had a significant decline in gross receipts during the eligibility periods. The credit is not available to individuals.

The ERC is a complex credit with precise requirements to help businesses during the pandemic, and since mid-September, the IRS has received approximately 3.6 million claims for the credit over the course of the program.

In July, the IRS said it was shifting its focus to review ERC claims for compliance concerns, including intensifying audit work and criminal investigations on promoters and businesses filing dubious claims. The IRS has hundreds of criminal cases being worked, and thousands of ERC claims have been referred for audit.

The new withdrawal process follows the Sept. 14 announcement of an immediate moratorium on processing new ERC claims. The moratorium, which will last until at least the end of this year, follows a flood of ineligible ERC claims. Payouts for claims submitted before Sept. 14 will continue during the moratorium period but at a slower pace due to more detailed compliance reviews. With stricter compliance reviews in place, existing ERC claims will go from a standard processing goal of 90 days to 180 days – and much longer if the claim faces further review or audit. The IRS may also seek additional documentation from the taxpayer to ensure the claim is legitimate.

Enhanced compliance reviews of existing claims submitted before the moratorium is critical to protect against fraud but also to protect businesses and organizations from facing penalties or interest payments stemming from bad claims pushed by promoters.

The IRS continues to warn taxpayers to use extreme caution before applying for the ERC as aggressive maneuvers continue by marketers and scammers.

The IRS is also working on guidance to help employers that were misled into claiming the ERC and have already received the payment. More details will be available this fall.

Who can ask to withdraw an ERC claim

Employers can use the ERC claim withdrawal process if of all the following apply:

They made the claim on an adjusted employment return (Forms 941-X, 943-X, 944-X, CT-1X).
They filed the adjusted return only to claim the ERC, and they made no other adjustments.
They want to withdraw the entire amount of their ERC claim.
The IRS has not paid their claim, or the IRS has paid the claim, but they haven’t cashed or deposited the refund check.

Taxpayers who are not eligible to use the withdrawal process can reduce or eliminate their ERC claim by filing an amended return. For details, see the Correcting an ERC claim – Amending a return section of the frequently asked questions about the ERC.

How to withdraw an ERC claim

To take advantage of the claim withdrawal procedure, taxpayers should carefully follow the special instructions at IRS.gov/withdrawmyERC, summarized below.

Taxpayers whose professional payroll company filed their ERC claim should consult with the payroll company. The payroll company may need to submit the withdrawal request for the taxpayer, depending on whether the taxpayer’s ERC claim was filed individually or batched with others.
Taxpayers who filed their ERC claims themselves, haven’t received, cashed or deposited a refund check and have not been notified their claim is under audit should fax withdrawal requests to the IRS. The IRS has set up a special fax line to receive withdrawal requests. This enables the agency to stop processing before the refund is approved. Taxpayers who are unable to fax their withdrawal can mail their request, but this will take longer for the IRS to receive.
Employers who have been notified they are under audit can send the withdrawal request to the assigned examiner or respond to the audit notice if no examiner has been assigned.

Those who received a refund check, but haven’t cashed or deposited it, can still withdraw their claim. They should mail the voided check with their withdrawal request using the instructions at IRS.gov/withdrawmyERC.

Upcoming webinar and other resources for help

Tax professionals and others can register for a Nov. 2 IRS webinar, Employee Retention Credit: Latest information on the moratorium and options for withdrawing or correcting previously filed claims. Those who can’t attend can view a recording later.

The IRS unveiled a new question and answer checklist last month to help taxpayers understand if they’re eligible for the credit. Since then, the IRS evolved the checklist into an interactive IRS.gov feature to help employers – and the tax professionals working with them – check potential ERC eligibility.

The IRS also continues to encourage employers to seek out a trusted tax professional who understands the complex ERC rules, not a promoter or marketer trying to get a hefty contingency fee while taking advantage of honest taxpayers.

New approach from scammers

Marketers and scammers have already revised their ERC pitches following the Sept. 14 moratorium announcement. Some are pushing employers who submit an ERC claim into agreeing to costly up-front loans in anticipation of a refund. The IRS urges taxpayers to avoid these loans and also learn the warning signs of ERC scams.

N-2023-70: Sections 4375 & 4376 – Insured and Self-Insured Health Plans Adjusted Applicable Dollar Amount for Fee Imposed by Sections 4375 and 4376

Issue Number: N-2023-70

Inside This Issue

Notice 2023-70 provides that the adjusted applicable dollar amount that applies for determining the Patient-Centered Outcomes Research Trust Fund (PCORTF) fee for policy years and plan years ending on or after October 1, 2023, and before October 1, 2024, is $3.22. This amount has been determined by using the percentage increase in the projected per capita amount of National Health Expenditures published by HHS in June 2023 and the adjustment, as determined by Treasury economists, for year to year variations.

Sections 4375 and 4376 impose a fee on issuers of specified health insurance policies and plan sponsors of applicable self-insured health plans to help fund the PCORTF. The PCORTF fee is determined by multiplying the applicable dollar amount for that year by the average number of lives covered during the year. The applicable dollar amount is based on increases in the projected per capita amount of National Health Expenditures, as most recently released by HHS.

Notice 2023-70 will be published in Internal Revenue Bulletin 2023-45 on November 6, 2023.

Existing Non-U.S. Filing Information Returns Electronically (FIRE) Customers

Subject: Existing Non-U.S. Filing Information Returns Electronically (FIRE) Customers

Audience: Payroll Industry, Tax Professionals, Small Business and Self Employed, Tax Exempt and Government Entities, Financial Institutions

If you are a non-U.S. customer and have not been able to complete an Information Returns (IR) Application for Transmitter Control Code (TCC) for access to the FIRE System:

Your FIRE TCC for filing Form 1042-S and Form 1099 will remain available for filing. No additional actions are required.
The IRS is aware that some foreign individuals who are acting on behalf of their foreign employer (e.g., Foreign Entities, Foreign Financial Institutions, Qualified Intermediaries, etc.) may not be able to obtain an individual taxpayer identification number (ITIN) or Social Security number (SSN) to complete the IR Application for TCC. We continue to explore other ways for taxpayers to authenticate their identities, including a government-sponsored option.

Reminder: Starting tax year 2023 (calendar year 2024), if you have 10 or more information returns, you must file them electronically. Find details on final e-file regulations on IRS.gov.

Visit Filing Information Returns Electronically (FIRE), for more information.

IR-2023-192: IRS advances innovative Direct File project for 2024 tax season; free IRS-run pilot option projected to be available for eligible taxpayers in 13 states

Issue Number: IR-2023-192

Inside This Issue

IRS advances innovative Direct File project for 2024 tax season; free IRS-run pilot option projected to be available for eligible taxpayers in 13 states

Agency finalizing Direct File pilot scope, details as work continues this fall; EITC, Child Tax Credit among projected provisions covered

WASHINGTON — As part of larger transformation efforts underway, the Internal Revenue Service announced today key details about the Direct File pilot for the 2024 filing season with several states planning to join the innovative effort.

The IRS will conduct a limited-scope pilot during the 2024 tax season to further assess customer support and technology needs. It will also provide a platform for the IRS to evaluate successful solutions for potential operational challenges identified in the report the IRS submitted to Congress earlier this year.

Arizona, California, Massachusetts and New York have decided to work with the IRS to integrate their state taxes into the Direct File pilot for filing season 2024. Taxpayers in nine other states without an income tax – Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming — may also be eligible to participate in the pilot. Washington has also chosen to join the integration effort for the state’s application of the Working Families Tax Credit. All states were invited to join the pilot, but not all states were in a position to join the pilot at this time.

“This is a critical step forward for this innovative effort that will test the feasibility of providing taxpayers a new option to file their returns for free directly with the IRS,” said IRS Commissioner Danny Werfel. “In this limited pilot for 2024, we’ll be working closely with the states that have agreed to participate in an important test run of the state integration. This will help us gather important information about the future direction of the Direct File program.”

People in those 13 states may be eligible to participate in the 2024 Direct File pilot, a new service that will provide taxpayers with the choice to electronically file their federal tax return directly with the IRS for free.

Taxpayer eligibility to participate in the pilot will be limited by the state in which the taxpayer resides and will be limited to taxpayers with certain types of income, credits and deductions – taxpayers with relatively simple returns. The IRS today announced it anticipates specific income types, such as wages on a Form W-2, and important tax credits, like the Earned Income Tax Credit and the Child Tax Credit, will be covered by the Direct File pilot.

The 2022 Inflation Reduction Act provided the IRS with long-term funding for the agency to transform its operations and improve taxpayer service, enforcement and technology. It also directed the IRS to study the possibility of a free, direct e-file program, which the IRS submitted in a report to Congress in May 2023. Projects like Direct File represent a goal of the IRS Strategic Operating Plan, to give taxpayers choices in how they interact with the tax agency. This includes choices in how they prepare and file their taxes, whether it’s through a tax professional, commercial tax software or free filing options. Direct File is one more potential option from which qualifying taxpayers will be able to choose to file a 2023 federal tax return during the 2024 filing season.

Since the delivery of the Direct File report in May – as directed by the Treasury Department – the IRS has been working to develop a pilot for the upcoming filing season, paying special attention to issues identified in the report related to customer support and state taxes. This limited-scale pilot will allow the IRS to evaluate the costs, benefits and operational challenges associated with providing a voluntary Direct File option to taxpayers.

“We have more work in front of us on this project,” Werfel said. “The Direct File pilot is undergoing continuous testing with taxpayers to identify and resolve issues to ensure its user friendly and easy to understand. We continue to finalize the pilot details and anticipate more changes before we launch for the 2024 tax season. Direct File, if pursued further after the pilot, would be another option eligible taxpayers have to help them prepare their tax returns in addition to existing options such as the use of a tax professional, tax software, Free File or another option. It’s consistent with the IRS mission to make sure taxpayers have available options that work the best for their personal situation.”

Direct File pilot basics

Eligible taxpayers may choose to participate in the pilot next year to file their tax year 2023 federal tax return for free, directly with the IRS.

Direct File will be a mobile-friendly, interview-based service that will work as well on a mobile phone as it does on a laptop, tablet or desktop computer. The service will be available in English and Spanish for the pilot.

The Direct File pilot will be a limited, phased pilot. It will not be available to all eligible taxpayers when the IRS begins accepting tax returns. Because the IRS wants to make sure the program works effectively, Direct File will first be introduced to a small group of eligible taxpayers in filing season 2024. As the filing season progresses, more and more eligible taxpayers will be able to access the service to file their 2023 tax returns.

Direct File does not replace existing filing options like tax professionals, Free File, free return preparation sites, commercial software and authorized e-file providers. Taxpayers will continue to have choices, whether they want to use a tax professional, a software product, Free File, free tax preparation services like Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) as well as a paper tax return or Direct File.

Taxpayers participating in the pilot will have access to help by IRS employees staffing the Direct File customer support function. IRS customer service representatives will provide technical support and provide basic clarification of tax law related to the tax scope of Direct File. Questions related to issues other than Direct File will be routed to other IRS customer support, as appropriate.

Pilot eligibility is limited

Eligibility for the pilot is limited by the types of income, tax credits and deductions that the product can initially support. Taxpayers who fall outside the pilot’s eligibility limits will be unable to participate in the pilot in 2024.

Direct File will cover only individual federal tax returns during the pilot. Also, Direct File will not prepare state returns. However, once a federal return is completed and filed, Direct File will guide taxpayers who want to file a state return to a state-supported tool that taxpayers can use to prepare and file a stand-alone state tax return. For the pilot in 2024, where taxpayers may have state or local tax obligations, the IRS will limit eligibility to states that are actively partnering with the IRS on the pilot.

Eligibility to participate in the pilot will be limited to taxpayers who reside in certain states where the pilot is available. Taxpayers in Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming may be eligible to participate in the pilot as their states do not levy a state income tax. Washington has also chosen to join the integration effort as a partner for the state’s application of the Working Families Tax Credit. For states that do levy a state income tax, Arizona, California, Massachusetts and New York have chosen to partner with the IRS for the 2024 Direct File pilot. The IRS anticipates the pilot will be available in those states as well in 2024.

The IRS and the Departments of Revenue in Arizona, California, Massachusetts, New York and Washington entered into separate Memorandums of Understanding in September for the purposes of collaboration on the IRS’s Direct File pilot for filing season 2024.

This approach will test the IRS’s ability to successfully integrate with a handful of states and the IRS will continue to work with all states to secure feedback and share what it learns through the course of its work on the pilot.

2024 Direct File pilot eligibility expected to cover key income, tax credits

Eligibility to participate in the 2024 pilot will be limited to reporting only certain types of income and claiming limited credits and adjustments. The tax scope for the pilot is still being finalized and is subject to change, but the IRS currently anticipates it will include:

Income reporting

W-2 wage income
Social Security and railroad retirement income
Unemployment compensation
Interest of $1,500 or less

Credits

Earned Income Tax Credit
Child Tax Credit
Credit for Other Dependents

Deductions

Standard deduction
Student loan interest
Educator expenses

Evaluating the Direct File Pilot

The purpose of the Direct File pilot is to test the system the IRS has developed and to learn from that test. This includes testing the technology, customer support, state integration, fraud detection and the overall taxpayer experience. The best way to test a new service offering such as Direct File is in a limited, controlled environment that will allow the IRS to identify issues and make changes prior to any potential large-scale launch in the future.

The 2024 filing season serves as a pilot for Direct File, and the purpose is to learn about the Direct File service itself and the needs of taxpayers who use it. By starting with a pilot, the IRS can efficiently learn about Direct File’s effectiveness, identify areas of improvement for future iterations and ensure it meets the needs of taxpayers who want to use it.

The IRS will publicly share the results of the pilot when available.

More information will be available at IRS.gov/directfile.

Statistics of Income Data Releases

Issue Number: 2023 – 12

Inside This Issue

2023 Calendar Year Projections of Information and Withholding Documents for the United States and IRS Campuses (Publication 6961) Update
Heavy Highway Vehicle Use Tax Returns, Calendar Years 2014-2023, Q2 Release
Fiscal Year Return Projections for the United States: 2023-2030, Publication 6292 (Spring 2023)
2022 Program Documentation: Data Items by Forms and Schedules (Publication 5384)
Foreign-Controlled Domestic Corporations, Tax Year 2020
2020 Corporation Income Tax Returns Complete Report (Publication 16)
U.S. Corporation Returns with a Foreign Tax Credit, Tax Year 2020
2020 Corporation Income Tax Returns Line Item Estimates (Publication 5108)

1. 2023 Calendar Year Projections of Information and Withholding Documents for the United States and IRS Campuses (Publication 6961) Update

The 2023 Calendar Year Projections of Information and Withholding Documents for the United States and IRS Campuses is now available on SOI’s Tax Stats webpage. The publication presents multi-year projections of the number of information and withholding returns to be filed with the IRS by processing categories important to the IRS planning operations, including form type and filing medium. The forecasts of selected paper returns are also shown by IRS Processing Campus locations.

2. Heavy Highway Vehicle Use Tax Returns, Calendar Years 2014-2023, Q2 Release

The Q2 release of the Heavy Highway Vehicle Use Tax Returns for Calendar Years 2014-2023 is now available on SOI’s Tax Stats webpage. This study provides the number of electronically filed Heavy Highway Vehicle Use Tax Returns (Forms 2290) by month at the national level. SOI updates these data two times per calendar year. This study is included in a series of statistical Projections of Federal Tax Return Filings, Supplemental Tables.

3. Fiscal Year Return Projections for the United States: 2023-2030, Publication 6292 (Spring 2023)

The Spring 2023 issue of Fiscal Year Return Projections for the United States (Publication 6292) is now available on SOI’s Tax Stats webpage. This semiannual publication contains United States-level projections of the number of tax returns for Fiscal Years 2023–2030 of approximately 50 different individual, business, and tax-exempt return types (e.g., Forms 1040, 1120, 941, and 990) to be filed by major return categories and by IRS business operating divisions. There is also additional detail by medium of filing (paper versus electronic) and actual number of returns filed for FY 2022.

4. 2022 Program Documentation: Data Items by Forms and Schedules (Publication 5384)

The 2022 Program Documentation: Data Items by Forms and Schedules (Publication 5384) is now available on SOI’s Tax Stats webpage. This publication contains the federal tax forms, schedules, and information documents selected for SOI’s Tax Year 2022 studies. It is organized in two parts: SOI works in collaboration with data users inside and outside of the federal government to develop the information collected for each SOI study. SOI bases most of its programs on stratified samples of returns for which data are collected prior to IRS audits; therefore, the data represent information as originally reported by taxpayers. Each tax form included in the SOI program is represented in this volume. The specific data items captured for each study are indicated on facsimiles of the forms and schedules. Data from certain forms and schedules are collected periodically, rather than annually. For this reason, the contents of this publication will vary somewhat from year to year.

5. Foreign-Controlled Domestic Corporations, Tax Year 2020

Tables for the Tax Year (TY) 2020 Foreign-Controlled Domestic Corporation study are now available on SOI’s Tax Stats webpage. The tables, based on data from the Form 1120 series, include balance sheets, income statements, and tax-related data for domestic corporations with 50-percent-or-more stock ownership by a single foreign “person.” The data are classified by industry group, country of ownership, age of the corporations, and new for this year, sizes of total assets and business receipts. There were 137,000 federal income tax returns filed by foreign-controlled domestic corporations (FCDCs) for TY 2020. These returns accounted for just 2.1 percent of all corporate returns filed for that year. However, the FCDCs were often large companies, with a combined $14.9 trillion of assets and $5.5 trillion of receipts. They reported 12.0 percent of the assets and 16.4 percent of the receipts of all corporations. Manufacturing companies accounted for $2.4 trillion of the FCDC receipts. Domestic companies with Japanese owners produced $0.8 trillion of receipts, followed closely by owners from the United Kingdom and the Netherlands ($0.7 trillion each). Established corporations (those incorporated in 2017 or before) produced $5.2 trillion of receipts. Large corporations, each with $2.5 billion or more of assets and those each with $1.0 billion or more or business receipts, accounted for $3.6 trillion and $4.1 trillion of receipts, respectively.

6. 2020 Corporation Income Tax Returns Complete Report (Publication 16)

Tables presenting statistics from Forms 1120, U.S. Corporation Income Tax Returns, are now available on SOI’s Tax Stats webpage. These tables present comprehensive data on corporation income tax returns with accounting periods ending July 2020 through June 2021. Statistics are presented by industry, asset size, business receipts size, tax form type, and other selected classifiers. Separate tabulations of data reported on Form 1120-S, U.S. Income Tax Return for an S Corporation, are also included.

7. U.S. Corporation Returns with a Foreign Tax Credit, Tax Year 2020

Statistics based on Foreign Tax Credit—Corporations (Form 1118) for Tax Year 2020 returns are now available on SOI’s Tax Stats webpage. Table 1, U.S. Corporation Returns with a Foreign Tax Credit, includes statistics for the number of returns, and foreign-source income, deductions, and taxes paid, accrued or deemed paid. These statistics are available by major and selected minor industries. Table 2 includes statistics for foreign-source gross income, deductions, and taxes paid, accrued, or deemed paid by selected country. Table 3 includes statistics for the number of returns, foreign-source gross income, deductions, and taxes paid, accrued, or deemed paid by category of foreign income for which separate credit was computed.

8. 2020 Corporation Income Tax Returns Line Item Estimates (Publication 5108)

The 2020 Corporation Income Tax Returns Line Item Estimates (Publication 5108) is now available on SOI’s Tax Stats webpage. The publication presents estimates of frequencies of taxpayer entries recorded on the applicable lines of the forms and schedules filed with corporation income tax returns as shown in the 2020 Statistics of Income (SOI) Corporation Income Tax Return Complete Report (Publication 16). Publication 5108 also contains corresponding population estimates of dollar amounts recorded on those lines (as applicable). Tax Year 2008 is the first year of availability for these data.

IR-2023-190: Most popular seminars at the 2023 IRS Nationwide Tax Forums now available online

Issue Number: IR-2023-190

Inside This Issue

Most popular seminars at the 2023 IRS Nationwide Tax Forums now available online

IR-2023-190, Oct. 16, 2023

WASHINGTON — Tax professionals who missed the 2023 IRS Nationwide Tax Forums last summer are now able to view and earn continuing education credits for 18 of the most popular seminars presented there.

The IRS Nationwide Tax Forums Online launched today and include 18 new self-study seminars that satisfy continuing education requirements in the categories of federal tax law, federal tax law update and ethics.

The new 2023 seminars are:

The Taxpayer Experience with IRS Independent Office of Appeals.
Keynote Address with IRS Commissioner Danny Werfel.
IRS – Strategic Operating Plan and Implementation.
Recent Developments in Foreign Withholding and Information Reporting.
Foreign Gift and Trust Reporting on Forms 3520 and 3520
The New Schedules K-2 and K-3 and Form 1116, Foreign Tax Credit and Reporting Items from Schedule K-3 on Form 1040-NR, U.S. Nonresident Alien Income Tax Return.
Circular 230 and Ethics in Tax Practice: How You Can Stay Out of Trouble.
A Potpourri of (Potentially Painful) Tax Professional Problems.
IA – Identity Verification for Tax Professionals.
Taxable Transactions with Digital Assets.
Abusive Tax Avoidance Transactions.
Changes to 1099-K Reporting Requirements.
What You Need to Know About the Information Returns Intake System.
Retirement Plan Distributions after SECURE 1.0 and SECURE 2.0
Assist with Individual Taxpayer Identification Number Services; Become an Acceptance Agent.
Tax Law Changes for 2023.
Identity Protection.
Sailing Through the Rules of Refundable Tax Credits.

The Nationwide Tax Forums Online are registered with the IRS Return Preparer Office and the National Association of State Boards of Accountancy as a qualified sponsor of continuing education. For a fee of $29 per seminar, CPAs, Enrolled Agents and Annual Filing Season Program participants taking the seminars can earn continuing education credits. To earn credit, users must create an account, answer review questions throughout the seminar and pass short tests at the end of the seminars.

The online forum seminars can also be reviewed free of charge. Individuals who choose the free option will not have access to the review questions or final examination and will not receive credit for the seminar.

In addition to the recently added seminars, the Nationwide Tax Forums Online also offer numerous seminars from prior-year IRS Nationwide Tax Forums. For more information, visit www.irstaxforumsonline.com.

RR-23-20: Adjusted federal interest rates

Issue Number: RR-2023-20

Inside This Issue

Revenue Ruling 2023-20 provides various prescribed rates for federal income tax purposes including the applicable federal interest rates, the adjusted applicable federal interest rates, the adjusted federal long-term rate, and the adjusted federal long-term tax-exempt rate. These rates are determined as prescribed by § 1274.

The rates are published monthly for purposes of sections 42, 382, 412, 642, 1288, 1274, 7520, 7872, and various other sections of the Internal Revenue Code.

Revenue Ruling 2023-20 will be in IRB 2023-45, dated November 06, 2023

IR-23-191: IRS announces 2024 Tax Counseling for the Elderly and Volunteer Income Tax Assistance Program Grants

Issue Number: IR-2023-191

Inside This Issue

IRS announces 2024 Tax Counseling for the Elderly and Volunteer Income Tax Assistance Program Grants

IR-2023-191, Oct. 16, 2023

WASHINGTON – The Internal Revenue Service recently awarded $51 million in Tax Counseling for the Elderly (TCE) and Volunteer Income Tax Assistance (VITA) grants to organizations that provide free federal tax return preparation.

This year, the IRS awarded grants to 45 TCE and 300 VITA applicants. The IRS received 429 applications requesting over $170 million in funding.

“As a part of the transformation of IRS, connecting with communities and providing resources through partnerships is part of our effort to ensure fair and equitable administration of taxes and provide valuable credits to those in need,” said Ken Corbin, the IRS Wage and Investment commissioner. “Grants ensure that these partners have access and are available.”

The TCE program, established in 1978, provides free tax counseling and federal return preparation to individuals who are age 60 or older. Volunteers receive training and technical assistance to provide assistance at community locations across the nation.

The VITA program, created in 1969, assists underserved communities, such as low- and moderate-income individuals and limited English proficient taxpayers. VITA grant recipients provide free federal tax return preparation and electronic filing. The grant program helps to expand VITA services to underserved populations.

The IRS forms partnerships with a wide variety of organizations across the country to develop VITA and TCE programs. Community partners include non-profit agencies, faith-based organizations, community centers and large employers. The IRS provides tax law training, certification and oversight to these organizations assisting their efforts to prepare accurate returns.

“VITA and TCE grant recipients work hard to improve the taxpayer experience in their own backyards,” said Maryann Enciso, acting national director for Stakeholder Partnerships, Education and Communication. “We are pleased to award these grants to our dedicated partners who provide quality tax preparation and financial education and asset building in their local communities. VITA/TCE is a ’cause not a program’ to help American taxpayers.”

For information on applying for the TCE or VITA programs along with a list of current grant recipients, visit the TCE webpage or the VITA webpage. For details on becoming a TCE or VITA volunteer, visit IRS Tax Volunteers.

IR-2023-189, For California Storm Victims, IRS postpones tax filing and tax payment deadlines

Issue Number: IR-2023-189

Inside This Issue

For California storm victims, IRS postpones tax-filing and tax-payment deadline to

Nov. 16

IR-2023-189, Oct. 16, 2023

WASHINGTON — The Internal Revenue Service today further postponed tax deadlines for most California taxpayers to Nov. 16, 2023. In the wake of last winter’s natural disasters, the normal spring due dates had previously been postponed to Oct. 16.

As a result, most individuals and businesses in California will now have until Nov. 16 to file their 2022 returns and pay any tax due. Fifty-five of California’s 58 counties—all except Lassen, Modoc and Shasta counties—qualify. IRS relief is based on three different FEMA disaster declarations covering severe winter storms, flooding, landslides, and mudslides over a period of several months.

The IRS normally provides relief, including postponing various tax filing and payment deadlines, for any area designated by the Federal Emergency Management Agency (FEMA). As long as their address of record is in a disaster-area locality, individual and business taxpayers automatically get the extra time, without having to ask for it. The current list of eligible localities is always available on the disaster relief page on IRS.gov.

What returns and payments qualify for the Nov. 16 deadline?

Eligible returns and payments include:

2022 individual income tax returns and payments normally due on April 18.
For eligible taxpayers, 2022 contributions to IRAs and health savings accounts.
Quarterly estimated tax payments normally due on April 18, June 15 and Sept. 15.
Calendar-year 2022 partnership and S corporation returns normally due on March 15.
Calendar-year 2022 corporate and fiduciary income tax returns and payments normally due on April 18.
Quarterly payroll and excise tax returns normally due on May 1, July 31 and Oct. 31.
Calendar-year 2022 returns filed by tax-exempt organizations normally due on May 15.

Other returns, payments and time-sensitive tax-related actions also qualify for the extra time. See the IRS disaster relief page for details.

Do taxpayers need to do anything to benefit from this relief?

The IRS automatically provides filing and penalty relief to any taxpayer with an IRS address of record located in the disaster area. Therefore, taxpayers do not need to contact the agency to get this relief.

It is possible an affected taxpayer may not have an IRS address of record located in the disaster area, for example, because they moved to the disaster area after filing their return. In these kinds of unique circumstances, the affected taxpayer could receive a late filing or late payment penalty notice from the IRS for the postponement period. The taxpayer should call the number on the notice to have the penalty abated.

In addition, the IRS will work with any taxpayer who lives outside the disaster area but whose records necessary to meet a deadline occurring during the postponement period are located in the affected area. Taxpayers qualifying for relief who live outside the disaster area need to contact the IRS at 866-562-5227. This also includes workers assisting the relief activities who are affiliated with a recognized government or philanthropic organization.

Additional tax relief

Individuals and businesses in a federally declared disaster area who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2023 return normally filed next year), or the return for the prior year (2022). Taxpayers have extra time – up to six months after the due date of the taxpayer’s federal income tax return for the disaster year (without regard to any extension of time to file) – to make the election. See Publication 547, Casualties, Disasters, and Thefts, for details.

Qualified disaster relief payments are generally excluded from gross income. In general, this means that affected taxpayers can exclude from their gross income amounts received from a government agency for reasonable and necessary personal, family, living or funeral expenses, as well as for the repair or rehabilitation of their home, or for the repair or replacement of its contents. See Publication 525, Taxable and Nontaxable Income, for details.

Additional relief may be available to affected taxpayers who participate in a retirement plan or individual retirement arrangement (IRA). For example, a taxpayer may be eligible to take a special disaster distribution that would not be subject to the additional 10% early distribution tax and allows the taxpayer to spread the income over three years.

Taxpayers may also be eligible to make a hardship withdrawal. Each plan or IRA has specific rules and guidance for their participants to follow.

The tax relief is part of a coordinated federal response to the damage caused by these disasters and is based on local damage assessments by FEMA. For information on disaster recovery, visit disasterassistance.gov.

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