Weekly Report from Washington, D.C.

Congress appropriated funds to keep its scorekeepers in business and the House is crafting a “family-friendly, phase-two” tax reform bill. Meanwhile, the IRS has released an automatic change of accounting method procedure for taxpayers wanting to change methods to comply with the new FASB/IASB standards. Also, released was guidance for disaster area victims in North Carolina and Indiana and so much more.

Congress

Budget requests for congressional scorekeepers have been approved by House appropriators. The JCT’s approved budget request is for $11.2 million and the CBO’s is $50.7 million.

Currently, House Republican tax writers are crafting a family friendly, phase two tax reform bill. The legislation will make the tax code more beneficial for individuals and families, House Ways and Means Committee Chairman Kevin Brady, R-Tex., told reporters earlier this week.

Treasury

The Treasury and IRS have released their third quarter update to the 2017-2018 Priority Guidance Plan. The 2017-2018 Priority Guidance Plan contained 198 guidance projects, most of which, do not involve the issuance of new regulations.

The Research, Applied Analytics, and Statistics (RAAS) organization’s current project management practices have not been instrumental in planning, monitoring, or measuring the impact of its research projects, according to a report by the Treasury Inspector General for Tax Administration.

IRS

The IRS has warned taxpayers of a new twist to an old scam that targets international taxpayers and nonresident aliens by using a fake IRS Form W-8BEN to solicit detailed personal identification and bank account information from victims.

The IRS has provided an automatic consent procedure for taxpayers to change to an accounting method that uses new standards issued by the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) for recognizing revenue from customer contracts

The IRS has released the 2019 inflation-adjusted amounts for health savings accounts under Code Sec. 223. For calendar year 2019, the annual limitation on deductions under Code Sec. 223(b)(2) for an individual with self-only coverage under a high-deductible plan is $3,500 ($7,000 for an individual with family coverage).

The IRS has released guidance regarding the computation of the housing cost/income ratio to be used by issuers of qualified mortgage bonds (QMBs) and mortgage credit certificates (MCCs).

For pension plan years beginning in May 2018, the IRS has released the Treasury bond weighted average interest rate, the unadjusted segment rates, the adjusted rates and the minimum present value segment rates.

The IRS has encouraged taxpayers who work seasonal jobs or are employed part of the year to perform a “paycheck checkup” with the Withholding Calculator because any changes that part-year employees make to their withholding can affect their paycheck way more than employees who work year-round.

The IRS released the specific accounting method changes to which the automatic change procedures apply. The latest guidance updates and supersedes the list of automatic changes found in Rev. Proc. 2017-30, I.R.B. 2017-18, 1131.

Victims of a tornado and severe storms that began on April 15, 2018, in parts of North Carolina may qualify for tax relief from the IRS. The president has declared the counties of Guilford and Rockingham a federal disaster area.

Victims of severe storms and tornadoes that began on February 14, 2018, in parts of Indiana may qualify for tax relief from the IRS. The president has declared the counties of Carroll, Clark, Elkhart, Floyd, Harrison, Jefferson, Lake, Marshall and St. Joseph a federal disaster area.

The IRS has reminded calendar-year tax-exempt organizations to file their Form 990-series information returns by May 15.

The IRS modified the safe harbor approaches for determining recognized built-in gain (RBIG) and recognized built-in loss (RBIL) for corporate reorganizations and ownership changes

The IRS has released the list of individuals who lost their U.S. citizenship during the quarter than ended on March 31, 2018.

As part of National Hurricane Preparedness Week (May 6-12), the IRS has provided guidance to help taxpayers safeguard their records against natural disasters.

The IRS has introduced a new online tool on IRS.gov as part of efforts to provide faster and easier access to publicly available information about exempt organizations.

With one day left for National Small Business Week, the IRS reminded employers to avail of the Work Opportunity Tax Credit (WOTC).

The IRS modified the definition of U.S. property under Code Sec. 956 for obligations that arise in connection with derivative financial instruments. Under Code Sec. 956, U.S. shareholders of controlled foreign corporations (CFCs) may be taxed on their pro rata share of the CFC’s investment of earnings in U.S. property.

The IRS issued guidance that explains how a state or local government can amend an empowerment zone nomination to provide for a new termination date of December 31, 2017, as provided for by Code Sec. 1391 as amended by the Protecting Americans from Tax Hikes Act of 2015 (PATH Act) (P.L. 114-113).

By Jessica Jean, Wolters Kluwer News Staff

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