IRS Employees Told to Work from Home

IRS Employees Told to Work from Home

The coronavirus pandemic has pushed the IRS to order its workforce to work from home. The IRS issued an email announcing the shift, and Accounting Today magazine obtained a copy of the email.

“As a result of recent OPM [U.S. Office of Personnel Management] guidance, starting Monday, March 30, 2020, the IRS is directing all employees, including employees who are currently not teleworking but whose work is portable or can be adapted to work off-site, to evacuate the work site and work from home (or an alternate location)—including employees who are not currently on a telework agreement,” said the memo. “All employees affected by this directive must take their equipment home to be prepared to work from home.”

The email directed workers to a chart that shows just which employees were expected to leave the premises and gave information to managers to better answer employee questions.

The memo also makes it clear that sick employees should not come in to the office, citing concerns for their own safety—and the safety of others.

The move to evacuate is no surprise to the union that represents IRS workers. Accounting Today reports the National Treasury Employees Union previously urged all federal agencies to close buildings housing 50 or more employees.

Latest in a Series of Steps

The IRS just recently closed its Practitioner Priority Service, which services the needs of tax professionals. The IRS website also said some other operations are being curtailed during the virus onslaught, but the agency is continuing to accept tax returns and send out refunds, both activities deemed mission-critical by the IRS.

The work-at-home order may have implications for the IRS’ latest project: sending out the stimulus payments that were approved by Congress to taxpayers. Those millions of checks and direct deposits are expected to be sent out in the next few weeks. The IRS cautions, though, checks sent through the mail will take longer to process.

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Treasury Clarifies Economic Impact Payments for Americans on Social Security

Treasury Clarifies Economic Impact Payments for Americans on Social Security

Economic Impact Payments are automatic for retirees.

The Treasury Department recently dispelled some uncertainty regarding how it would handle economic impact payments for Americans on Social Security. According to the press release, those who rely on Social Security payments will simply receive stimulus money via direct deposit.

Treasury is instructing the IRS to use Forms SSA-1099 and RRB-1099 to direct payments to those who don’t regularly file tax returns. Treasury Secretary Steven Mnuchin explained the rationale for the update: “We want to ensure that our senior citizens, individuals with disabilities, and low-income Americans receive Economic Impact Payments quickly and without undue burden.”

The clarification comes days after initial guidance recommended that those who don’t normally file tax returns “file a simple tax return to receive an economic impact payment,” specifically listing Social Security recipients alongside “low-income taxpayers, senior citizens, … [and] some veterans and individuals with disabilities.”

Some of the confusion seems to have arisen from the method used to determine economic impact payment eligibility: the income claimed in a recent tax return. Since these payments have a phase-out threshold, tax returns are being used to determine how much stimulus money—if any—taxpayers will receive. Now, Social Security recipients will automatically get their $1,200 payment.

Guidance isn’t yet clear as to what steps should be taken by low-income taxpayers who don’t receive Social Security benefits and aren’t required to file a tax return. Be sure to check the Taxing Subjects blog for other tax updates!

Source: “Social Security Recipients Will Automatically Receive Economic Impact Payments

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NASBA Recommends CPE Grace Period

NASBA Recommends CPE Grace Period

COVID-19 could affect CPE reporting deadlines.

The National Association of State Boards of Accountancy (NASBA) on Tuesday announced that it was recommending state boards of accountancy across the country extend their CPE-completion deadlines to accommodate accountants affected by COVID-19 disruptions. This development comes on the heels of federal, state, and local governments implementing a number of public safety measures designed to reduce the spread of the coronavirus.

NASBA recommended extending current CPE deadlines to October 31, 2020. “If a CPA’s reporting period ended on March 31, 2020, the licensee would have until October 31, 2020, to complete the CPE requirements for that reporting period,” NASBA explained. “Similarly, if a CPA’s reporting period ended on June 30, 2020, the licensee would have until October 31, 2020, to complete the required CPE.”

As an advocacy and advisory group for state boards of accountancy, NASBA notes in the press release that it does not hold regulatory authority over those bodies. While individual boards of accountancy will make their own determinations concerning CPE deadlines for current and pending licensees, NASBA committed to cataloguing which states extend their CPE deadlines.   

In the announcement, NASBA noted that their office—located in Nashville, TN—has already transitioned to remote work, underscoring the challenges faced by businesses across the country.

Source: “CPE Reporting Grace Period Due to COVID-19 – NASBA Recommendations”

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IRS Implements New Signature Policy due to COVID-19

IRS Implements New Signature Policy due to COVID-19

COVID-19 has disrupted life for Americans across the country, and as we’ve seen in recent weeks, the tax industry is not immune to change. To limit the number of physical documents handled by IRS employees, the IRS announced that it has adjusted its policy regarding tax signatures for this unprecedented filing season.

“We are implementing a temporary deviation that allows IRS employees to accept images of signatures (scanned or photographed) and digital signatures on documents related to the determination or collection of tax liability,” the IRS explained in the memorandum to tax industry partners. “We are also implementing a temporary deviation that allows IRS employees to accept documents via email and to transmit documents to taxpayers using SecureZip or other established secured messaging systems, [like e-Fax].”

Prior to publishing the memo, the IRS typically accepted electronic signatures for a variety of tax forms—the most notable and common being the Form 1040. This announcement specifically pertains to documents that typically require a physically printed and signed form:

  • Extensions of statute of limitations on assessment or collection
  • Waivers of statutory notices of deficiency and consents to assessment
  • Agreements to specific tax matters or tax liabilities (closing agreements)
  • Case specific Power of Attorney

The IRS noted that tax professionals and taxpayers who need to confirm whether a specific form will be accepted digitally should contact the Business Operating Division. Those who need to submit a signed tax document to the IRS via email will need to use one of the approved file types outlined in the memo: .tiff, .jpg (.jpeg), .pdf, and .zip. The IRS also said encrypted files and files created by Microsoft Office Suite will be accepted.

While this is the latest COVID-19 motivated change in IRS protocols, it might not be the last. Remember to check Taxing Subjects regularly for future tax industry updates.  

Source: IRS Memorandum

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Economic Impact Payments: The Facts

Economic Impact Payments: The Facts

Distribution of the federal government’s economic impact payments, meant to counter the economic effects of the coronavirus pandemic in the U.S., is scheduled to start in the coming weeks, according to the U.S. Treasury Department. No action is required on the part of most taxpayers.

However, some seniors and others who normally don’t file a return will need to submit a simple tax return to receive a stimulus payment.

There are a few things the Treasury Department and the IRS want taxpayers to know about the payments and the process to distribute them.

Who is Eligible?

Taxpayers with adjusted gross income (AGI) of up to $75,000 for individuals and $150,000 for married couples filing jointly will get the full amount. Above the stated limits, the payment is reduced by $5 for each $100 above the $75,000 or $150,000 thresholds.

Single filers with income above $99,000 and joint filers making more than $198,000 with no children are not eligible.

Eligible taxpayers who filed tax returns for 2019 or 2018 will automatically receive a payment of up to $1,200 for individuals or $2,400 for married couples. Parents will also get $500 for each qualifying child.

How Will the IRS Know Where to Send It?

The IRS says the “vast majority” of taxpayers don’t have to take any action. The IRS will automatically calculate and send the payments to eligible taxpayers.

For those who’ve already filed their 2019 tax returns, the IRS will use this most recent information to figure the payment amount. If taxpayers have not yet file their return for 2019, their 2018 tax return will be used to calculate the payment.

The economic impact payment will be deposited directly into the same banking account used on the return that was filed.

If the IRS Doesn’t Have Your Direct Deposit Information

Treasury plans to develop a web-based portal for individuals to provide their banking information to the IRS online, so that taxpayers can get payments immediately, as opposed to waiting for a check in the mail.

Not Required to File a Tax Return?

People who typically don’t file a tax return will need to file a simple return to receive an economic impact payment. Low-income taxpayers, senior citizens, Social Security recipients, some veterans and taxpayers with disabilities who are otherwise not required to file will not owe tax.

How to File the Necessary Return

The IRS will soon provide instructions on IRS.gov/coronavirus on how to file a 2019 tax return with simple—but necessary—information, including their filing status, number of dependents and direct deposit bank account information.

Didn’t File in 2018 or 2019?

You can still receive a payment. The IRS urges anyone with a tax-filing obligation who hasn’t yet filed a return for 2018 or 2019 to do so as soon as they can in order to receive a stimulus payment. Taxpayers should include direct deposit banking information on the return. 

How Long are the Payments Available?

For those concerned about visiting a tax professional or otherwise getting help to file with a tax return, the economic impact payments will be available throughout the rest of 2020.

Need More Information?

The IRS will post all key information on IRS.gov/coronavirus as soon as it becomes available.

Keep in mind, the IRS has a reduced staff in many of its offices but remains committed to helping eligible taxpayers receive their payments in a quick and efficient manner. Check for updated information on IRS.gov/coronavirus instead of calling the IRS help line, where operators are trying to help taxpayers file their 2019 returns.

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IRS Releases “People First” Initiative

IRS Releases “People First” Initiative

As taxpayers face multiple challenges posed by the COVID-19 outbreak, the IRS has unveiled a large series of steps providing relief on a number of fronts, ranging from easing payment guidelines to postponing compliance actions.

“The IRS is taking extraordinary steps to help the people of our country,” said IRS Commissioner Chuck Rettig. “In addition to extending tax deadlines and working on new legislation, the IRS is pursuing unprecedented actions to ease the burden on people facing tax issues. During this difficult time, we want people working together, focused on their well-being, helping each other and others less fortunate.”

Retting said the People First Initiative provides immediate relief to help people facing uncertainty over taxes. “We are temporarily adjusting our processes to help people and businesses during these uncertain times. We are facing this together, and we want to be part of the solution to improve the lives of all people in our country,” the commissioner added.

People First includes changes on issues ranging from postponing installment agreement-related payments and offers in compromise to collection and limiting certain enforcement actions.

The initiative projects a starting date of April 1 and initially runs through July 15. During this time the IRS will avoid in-person contacts as much as possible to limit the spread of the virus.

While specifics of the initiative are still being nailed down, an IRS release had some details about some of the programs affected by this new move:

Existing Installment Agreements

For taxpayers under an existing Installment Agreement, payments due between April 1 and July 15, 2020 are suspended. Taxpayers who are currently unable to comply with the terms of an Installment Payment Agreement, including a Direct Deposit Installment Agreement, may suspend payments during this period if they prefer. Furthermore, the IRS will not default any Installment Agreements during this time. By law, however, interest will continue to accrue on any unpaid balances.

New Installment Agreements

The IRS reminds people unable to fully pay their federal taxes that they can resolve outstanding liabilities by entering into a monthly payment agreement with the IRS. See IRS.gov for further information.

Offers in Compromise (OIC)

The IRS is taking several steps to assist taxpayers in various stages of the OIC process:

  • Pending OIC applications – The IRS will allow taxpayers until July 15 to provide requested additional information to support a pending OIC. In addition, the IRS will not close any pending OIC request before July 15, 2020, without the taxpayer’s consent.
  • OIC Payments – Taxpayers have the option of suspending all payments on accepted OICs until July 15, 2020, although by law interest will continue to accrue on any unpaid balances.
  • Delinquent Return Filings – The IRS will not default an OIC for those taxpayers who are delinquent in filing their tax return for tax year 2018. However, taxpayers should file any delinquent 2018 return (and their 2019 return) on or before July 15, 2020. 

Non-Filers Need to Get Current

Those who have not filed their tax returns for years before 2019 should file their delinquent returns. More than a million households haven’t filed during the last three years, yet are owed refunds. They still have time to claim those refunds.

The IRS recommends contacting a tax pro to tap into the options available for these late filers. Time, however, is limited by law. The IRS says once delinquent returns have been filed, taxpayers with tax liabilities should resolve any outstanding tax due and take advantage of the IRS’ Installment Agreement or an Offer in Compromise to get a “Fresh Start.” Check IRS.gov for details.

Other areas included in the IRS People First Initiative include modifications to field collection activities and automatic liens.

Liens and levies (including any seizures of a personal residence) initiated by field revenue officers will be suspended during the initiative. However, field revenue officers will continue to pursue high-income non-filers and perform other similar activities where warranted.

New automatic, systemic liens and levies will be suspended while the initiative is in place.

Passport certifications are also covered. IRS will suspend new certifications to the Department of State for taxpayers who are “seriously delinquent” during this period. These taxpayers are encouraged to submit a request for an Installment Agreement or, if applicable, an OIC during this period. Certification prevents taxpayers from receiving or renewing passports.

Debt collection efforts by private contractors will be on hold during the period. The IRS says it will generally not start new field, office or correspondence examinations during the period. They will continue to work refund claims where possible without face-to-face contact. Some new examinations, however, may be started where the statute of limitations is a factor.

For a full listing of the proposed actions during the initiative period, see the IRS People First Initiative release on the IRS website. 

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