| e-News for Small Business | June 11, 2024 |
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Issue Number: ?2024-12
Inside This Issue
- Hobby or business: What people need to know if they have a side hustle
- Disaster tax relief
- Filing deadline for taxpayers living and working abroad
- Energy related tax credits under the Inflation Reduction Act
- Document Upload Tool reaches key milestone
- Other tax news
1.? Hobby or business: What people need to know if they have a side hustle
Hobbies and businesses are treated differently when it comes to filing taxes.
Whether someone is having fun with a hobby or running a business, if they?re paid through payment apps for goods and services during the year, they may get an IRS Form 1099-K for those transactions. These payments are taxable income and taxpayers must report the income on federal tax returns.
2.? Disaster tax relief
The IRS reminds individuals and businesses in parts of seven states that their 2023 federal income tax returns and tax payments are due Monday, June 17, 2024.
The deadline applies to taxpayers affected by disaster declarations for certain areas of California, Connecticut, Michigan, Maine, Tennessee, Washington and West Virginia.
The current list of eligible localities is always on the Tax relief in disaster situations page on IRS.gov.
Many payments to individuals affected by Ohio train disaster are tax-free
The IRS announced that in many cases payments received by individuals affected by last year?s train derailment in East Palestine, Ohio, are not taxable. This new guidance could help taxpayers in Ohio, Pennsylvania and West Virginia.
Taxpayers qualify for the exclusion only if the expenses covered by the qualified disaster relief payments made by the common carrier aren?t paid for by insurance or other reimbursement. For details see East Palestine train derailment frequently asked questions.
Tax relief announced for taxpayers affected by Massachusetts storms
The IRS announced tax relief for individuals and businesses in parts of Massachusetts affected by severe storms and flooding that began Sept. 11, 2023.
These taxpayers now have until July 31, 2024, to file various federal individual and business tax returns and make payments.
3.? Filing deadline for taxpayers living and working abroad
The IRS reminds taxpayers living and working outside the United States to file their 2023 federal income tax return by Monday, June 17.
This deadline applies to U.S. citizens and resident aliens abroad, including those with dual citizenship.
4.? Energy related tax credits under the Inflation Reduction Act
Corrected guidance issued for Domestic Content Bonus Credit
The Treasury and IRS released a corrected version of Notice 2024-41 to modify an existing safe harbor and to provide a new elective safe harbor for determining the Domestic Content Bonus Credit amounts for sourcing certain components in the energy industry.
Guidance issued on Clean Fuel Production Credit registration
The Treasury and IRS issued Notice 2024-49 for the Clean Fuel Production Credit. The Inflation Reduction Act allows a credit for producers of clean transportation fuels beginning Jan. 1, 2025.
The notice gives details about registration requirements for fuel producers who may be eligible for the credit.
IRS accepting comments about clean electricity facilities and energy storage technologies
The Treasury and IRS issued proposed regulations for owners of qualified clean electricity facilities and energy storage technology. Taxpayers may be eligible for a credit:
- On electricity produced from a qualified clean electricity facility, or
- For a qualified investment in a qualified clean electricity facility or energy storage technology.
The proposed regulations explain how to send comments to the IRS as well as information on the public hearing.
Low-Income Communities Bonus Credit Program application portal is open
The Treasury, IRS and Department of Energy announced that the application portal for the 2024 Low-Income Communities Bonus Credit Program is now open. Applications made by 11:59 p.m. ET on June 27, 2024, are considered as submitted at the same date and time. Those submitted after June 27 will be evaluated on a rolling basis.
This program provides a 10 or 20 percentage point increase to the energy investment credit for solar and wind facilities under five megawatts (AC) if the facility applies for and receives an allocation of environmental justice solar and wind capacity limitation.
5.? Document Upload Tool reaches key milestone
The IRS?s Document Upload Tool recently accepted its millionth submission ? another success in the agency?s transformation work.
Using this tool, businesses can often reply easily to IRS notices by scanning required documents and submitting them to the IRS with a smart phone or computer.
6.? Other tax news
The following information may be of interest to individuals and groups in or related to small businesses:
? Taxpayers can appeal a rejected offer in compromise
? Summer activities to consider for next year tax returns: business travel, home improvements, marriage, summer camp
? IRS makes Direct File a permanent option to file federal tax returns
? Fumi Tamaki selected as new IRS Chief Taxpayer Experience Officer
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