Weekly Report from Washington, D.C.

During the week of October 29, President Donald Trump and House Ways and Means Committee Chairman Kevin Brady, R-Tex., issued a joint statement on new 10 percent middle-income tax cut. The House approved its “Tax Reform 2.0” package last month, which includes measures to make permanent the TCJA’s individual tax cuts and enhance various savings accounts and business innovation. Further, proposed regulations were released to reduce the Code Sec. 956 amount for certain domestic corporations that own stock in controlled foreign corporations (CFCs).

White House

President Donald Trump and House Ways and Means Committee Chairman Kevin Brady, R-Tex., issued a joint statement on new 10 percent middle-income tax cut. “We are not done yet,” Trump and Brady said in the joint statement. “We are committed to delivering an additional 10 percent tax cut to middle-class workers across the country. And we intend to take swift action on this legislation at the start of the 116th Congress.”, (TAXDAY, 2018/11/01, W.1).

Congress

A new, 10 percent middle-income tax cut is conditionally expected to be advanced in 2019, according to the House’s top tax writer. The House approved its “Tax Reform 2.0” package last month, which includes measures to make permanent the TCJA’s individual tax cuts and enhance various savings accounts and business innovation, (TAXDAY, 2018/10/29, C.1).

Treasury

The Tax Exempt and Government Entities (TE/GE) Division did not share detailed results of quality reviews with group managers and examiners who were responsible for performing Employee Plans (EP) function examinations, according to a report by the Treasury Inspector General for Tax Administration (TIGTA), (Ref. No. 2019-10-001; TAXDAY, 2018/11/02, T.1).

The IRS could use its limited resources more efficiently and make more informed business decisions in connection with improving its information technology (IT), according to a report by the Treasury Inspector General for Tax Administration (TIGTA), (Ref. No. 2018-20-083; TAXDAY, 2018/10/31, T.1).

Taxpayers generally complied with annual contribution limits for 401(k) plans; however, additional efforts could further improve compliance, according to a report by the Treasury Inspector General for Tax Administration (TIGTA), (Ref. No. 2019-10-002; TAXDAY, 2018/10/30, T.1).

IRS

Inflation adjustments. The IRS announced cost-of-living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2019, (IR-2018-211; Notice 2018-83;TAXDAY, 2018/11/02, I.1).

IRSAC. The IRS announced that the Internal Revenue Service Advisory Committee’s (IRSAC’s) role would expand in 2019 to have a wider portfolio and incorporate two other advisory groups. The expanded IRSAC will include areas currently covered by both the Information Reporting Program Advisory Committee (IRPAC) and the Advisory Committee on Tax Exempt and Government Entities (ACT)., (IR-2018-212;TAXDAY, 2018/11/02, I.2).

I.R.B. The IRS released I.R.B. 2018-45, dated November 5, 2018, (TAXDAY, 2018/11/02, I.3).

Comment Request. The IRS requested comments on validating TIN and reasonable cause form, (TAXDAY, 2018/11/02, I.4).

FEMA Notice. The Federal Emergency Management Agency (FEMA) announced that the president determined that certain areas in Georgia, Wisconsin and North Carolina were eligible for assistance from the federal government under the Disaster Relief and Emergency Assistance Act (42 USC 5121), (TAXDAY, 2018/11/02, I.5).

Tax Tip. The IRS highlighted depreciation deduction changes and its effect on farmers, (TAXDAY, 2018/11/02, I.6).

Disaster Notice. The IRS granted tax relief to Northern Mariana Islands victims of typhoon Yutu, (TAXDAY, 2018/11/01, I.1).

NPRM Regulation. Proposed regulations were released to reduce the Code Sec. 956 amount for certain domestic corporations that own stock in controlled foreign corporations (CFCs), (NPRM REG-114540-18; IR-2018-210; TAXDAY, 2018/11/01, I.2).

Comment Request. The IRS requested comments on ETAAC membership application form, (TAXDAY, 2018/11/01, I.3).

Tax Tip. The IRS shared tips on how the new tax law would benefit farmers and ranchers, (TAXDAY, 2018/11/01, I.4).

TAP Meeting. The Taxpayer Advocacy Panel (TAP) Joint Committee announced that an open meeting would be held on Thursday, November 15, 2018 at 1:00 p.m. ET via teleconference, (TAXDAY, 2018/10/31, I.1).

Tax Filing. The IRS advised taxpayers about the measures they could take to ensure smooth processing of their 2018 tax return and avoid surprises when they file next year, (IR-2018-209;TAXDAY, 2018/10/31, I.2).

Tax Tip. The IRS shared tips on how the new tax law would benefit farmers and ranchers, (TAXDAY, 2018/10/31, I.3).

Hearing Notice. The IRS has scheduled a hearing on proposed changes to the regulations under Code Sec. 168(k) relating to guidance regarding additional first year depreciation deduction. The public hearing will be held on Wednesday, November 28, 2018, at 10:00 a.m. in the IRS Auditorium, Internal Revenue Service Building, 1111 Constitution Avenue NW., Washington, D.C. 20224, (TAXDAY, 2018/10/30, I.1).

Per Diem Rates.The U.S. State Department released a listing of maximum travel per diem allowances for travel in foreign areas. The rates apply to all government employees and contractors, and are effective as of November 1, 2018, (TAXDAY, 2018/10/30, I.2).

Tax Tip. The IRS shared tips regarding IRS disaster help, (TAXDAY, 2018/10/30, I.3).

IRSAC. The Internal Revenue Service Advisory Council (IRSAC) announced that it would hold a public meeting on Thursday, November 15, 2018, from 9:10 a.m. to 12:30 p.m. ET at the Melrose Georgetown Hotel, 2430 Pennsylvania Ave NW, Potomac III, Washington, DC, 20037, (TAXDAY, 2018/10/29, I.1).

Miscellaneous

Transition Tax Rules. The American Institute of CPAs (AICPA) and the American Bar Association (ABA) Section of Taxation urged the IRS to make extensive changes to proposed “transition tax” rules. In an October 31 letter to the IRS, the AICPA offered 15 recommendations to provide taxpayers further clarity and guidance on tax reform’s transition tax requirements, (TAXDAY, 2018/11/01, M.2).

MACRS. Final regulations explained how to depreciate MACRS property acquired in a like-kind exchange under Code Sec. 1031 or an involuntary conversion under Code Sec. 1033 (T.D. 9314), (TAXDAY, 2018/10/31, M.1).

Opportunity Zone Program. The IRS released the much anticipated proposed regulations, REG-115420-18, for tax reform’s Opportunity Zone program earlier this month. The proposed rules provide “clarity and some good news for taxpayers,” Micheal Bernier, partner at Ernst & Young’s (EY) National Tax practice, told Wolters Kluwer in an emailed statement, (TAXDAY, 2018/10/30, M.1).

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