e-News for Tax Professionals 2024-32

The IRS takes more steps to support small businesses and stop improper payments in the Employee Retention Credit (ERC) program. These steps include increasing the pace at which payments are made and carrying out compliance work on the intricate pandemic-era credit that saw a surge in claims as a result of deceptive marketing.

“The Employee Retention Credit is one of the most complex tax provisions ever administered by the IRS, and the agency continues working hard to balance our work to protect taxpayers from improper claims while also making payments to qualifying businesses,” said IRS Commissioner Danny Werfel. “It has been a time-consuming process to separate valid claims from invalid ones. During the past year, we maintained a steady cadence of both ERC approvals and disapprovals.”

“The IRS is committed to continuing our work to resolve this program as Congress contemplates further action, both for the good of legitimate businesses and tax administration,” Werfel added.

2. Tax relief available for Hurricane Debby victims in four states

Disaster-area taxpayers affected by Hurricane Debbie in South Carolina, North Carolina, Florida and Georgia now have until Feb. 3 to file various federal individual and business tax returns and make required payments. The IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA), and the same relief will be available to any other counties added later to the disaster areas. The current list of eligible localities is always available on the Tax relief in disaster situations page on IRS.gov.

3. Security Summit partners urge use of multi-factor authentication to protect against evolving scams to tax professionals, businesses and clients

In the fifth installment of the “Protect Your Clients; Protect Yourself” special series, the IRS and its Security Summit partners informed tax professionals that multi-factor authentication is now required by federal law, in addition to being a crucial security measure for their businesses and their clients. The Federal Trade Commission’s safeguards rule now mandates that all tax professionals use multi-factor authentication, or MFA, to secure sensitive client data.

“Multi-factor authentication is now more than just a good idea for tax professionals; it’s a requirement,” said IRS Commissioner Danny Werfel. “This is an effective way to increase security and protect tax professionals and their clients from a data breach. Multi-factor authentication is a little like a deadbolt on a door; its additional security supplementing the doorknob lock. This is an important step to protect not just tax professionals and their firms, but also the sensitive taxpayer information from their clients.”

Tax professionals may do the following to report stolen data:

Share information with the appropriate state tax agency by visiting Report a Data Breach;
Review Publication 5293, Data Security Resource Guide for Tax Professionals;
Obtain an identity protection PIN or complete Form 14039, Identity Theft Affidavit, if applicable; and
Report the incident to their local IRS stakeholder liaison.

Visit the Data Theft information for tax professionals webpage to learn more.

4. IRS Nationwide Tax Forum: Limited time remaining to register for Baltimore, Dallas

Last-minute registrants: Space is still available at the upcoming IRS Nationwide Tax Forum in Baltimore, Aug. 13-15, and Dallas, Aug. 20-22. The San Diego Tax Forum, Sept. 10-12, is sold out.

Each IRS Tax Forum offers tax professionals 45 different continuing education seminars. Attendees can earn up to 19 continuing education credits.

Other forum features include the Taxpayer Advocate Service’s Case Resolution Room - where attendees can get assistance on a tough client case – and the Digital Account Services Room, which provides help on IRS Online Accounts, Preparer Tax Identification Numbers (PTINs) and Centralized Authorization File (CAF) issues. Multiple IRS experts will be on hand to answer questions on digital assets, cybersecurity, and scams, while recruiting staff will be interviewing for IRS revenue agent and officer positions.

For a description of the program and to register, visit IRS Nationwide Tax Forum.

You can learn more about this year’s program on the following videos produced independently by Tax Talk Today:

5. IRS revamps draft version of Form 1099-DA, Digital Asset Proceeds from Broker Transactions; requests feedback for 2025

The IRS published a draft version of Form 1099-DA, Digital Assets, which brokers must use to report specific exchange and sale transactions involving digital assets starting in 2025. Typically, in early 2026, taxpayers and IRS will receive separate copies of these forms. The updated Form 1099-DA draft incorporates the transitional relief outlined in Notice 2024-56, Notice 2024-57 and Revenue Procedure 2024-28 and conforms to the final regulations for custodial broker reporting regulations.

Comments regarding the draft can be submitted to the IRS through the forms and publications comments page on IRS.gov.

6. Treasury, IRS shares Inflation Reduction Act clean energy statistics

The Department of Treasury and the IRS released data regarding the clean energy tax credits under the Inflation Reduction Act for the 2023 tax year. Taxpayers can now claim more tax credits for residential and energy efficient homes. More than $6 billion in tax credits have been claimed by taxpayers for home energy investments and more than $2 billion will be used for energy-efficient home improvements thanks to the Inflation Reduction Act.

7. Upcoming webinar for tax practitioners

The IRS offers the upcoming live webinar to the tax practitioner community:

In the know with RPO: An update from the Return Preparer Office on August 22, at 2 p.m. ET. Earn up to 1 CE credit (Federal Tax). Certificates of completion are being offered.

For more information or to register, visit Webinars for tax practitioners webpage.

8. Technical Guidance

Revenue Procedure 2024-32 updates Rev. Proc. 2017-55 to set forth the procedure by which the sponsor of a defined benefit plan that is subject to the funding requirements of section 430 may request approval from the IRS for the use of plan-specific substitute mortality tables in accordance with section 430(h)(3)(C) and section 1.430(h)(3)-2.

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