e-News for Tax Professionals 2023-12

Continuing an ongoing public awareness effort, the IRS launched its 2023 Dirty Dozen campaign warning against prevalent scams and schemes they?re seeing this tax season. This year?s campaign includes warnings against:

Employee Retention Credits, following blatant attempts by promoters to con ineligible people to claim the credit. Renewing several earlier alerts, the IRS highlighted schemes from promoters who have been blasting ads on radio and the internet touting refunds involving ERCs.
Phishing and smishing schemes, where cybercriminals try to steal a taxpayer's information through scam emails or text messages.
Scammers who try to sell or offer help setting up an online account on IRS.gov that puts their tax and financial information at risk of identity theft.
Promoters pushing improper fuel tax credit claims that taxpayers aren't qualified to receive.
Scammers using fake charities to dupe taxpayers, especially following major disasters.

2.??What to do when you receive a Form 1099-K

If taxpayers receive a Form 1099-K, Payment Card and Third Party Network Transactions, they should use that information with their other tax records to determine their correct tax liability. The IRS has also revised frequently asked questions about Form 1099-K. Visit IRS.gov for tips on what to do if a Form 1099-K is incorrect and the 1099-K reporting threshold for tax year 2023.

3.? IRS: Use these steps to prevent tax return errors

With only a few weeks remaining before the April 18 filing deadline, the IRS provides tips on how to avoid common errors on federal tax returns and help to get possible refunds sooner. This news release is also available in Spanish and Simplified Chinese.

4.??Important details to understand when the IRS might contact a taxpayer

The IRS reaches out in multiple ways to educate taxpayers while ensuring it fairly enforces the nation's tax laws. There are important factors to keep in mind about when the IRS may initiate direct contact with a taxpayer. This news release is also available in Spanish and Simplified Chinese.

5.??Tax relief for New York storm victims

Some New York winter storm and snowstorm victims now have until May 15 to file various federal individual and business tax returns and make tax payments. The IRS is offering relief to any area designated by the Federal Emergency Management Agency (FEMA) because of storms that occurred between Dec. 23 and Dec. 28, 2022. The current list of eligible localities is available on the Tax Relief in Disaster Situations page.

6.??Treasury, IRS issue guidance on implementation of advanced manufacturing investment credit

The IRS issued proposed regulations that provide guidance regarding the implementation of the Advanced Manufacturing Investment Credit, established by the Creating Helpful Incentives to Produce Semiconductors Act of 2022, commonly known as the CHIPS Act. This credit will incentivize the manufacture of semiconductors and semiconductor manufacturing equipment within the United States.

7.??News from the Justice Department?s Tax Division

A federal court in West Palm Beach, Fla., held that Jeffrey Cadet violated a permanent injunction entered against him, which barred him from acting as a federal tax return preparer or requesting, assisting in or directing the preparation or filing of federal tax returns for others. To remedy his contempt, the court ordered Cadet to disgorge $24,410 in ill-gotten fees he received for conduct that violated the injunction. The court also ordered Cadet to pay the United States $7,386.39 to reimburse the government for the attorneys? fees it incurred to investigate and prosecute his post-injunction conduct.

8.??Technical Guidance

Notice 2023-27 announces that the Treasury Department and the IRS intend to issue guidance related to the treatment of certain NFTs as section 408(m) collectibles. This treatment is also relevant for other purposes of the Code, including the long-term capital gains tax rate under section 1(h). The notice also describes how the IRS intends to determine whether an NFT constitutes a section 408(m) collectible, pending the issuance of that guidance, and requests comments generally on the treatment of NFTs as a section 408(m) collectible, as well as comments on specific questions listed in the notice.

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