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NCCPAP Meeting with the IRS & Congress
Upcoming May 10 Agenda
Several NCCPAP members from around the country will be attending an upcoming meeting in Washington‚ D.C. with representatives of the IRS on May 10‚ 2018. Topics being discussed at that meeting include:
Abatement of Penalties

Issue: When a taxpayer receives a notice from the IRS indicating that a balance is due—assuming it is correct—the preparer can request that the taxpayer make the payment for the amount due plus interest‚ but not for the penalty. The taxpayer can also send correspondence to the IRS with the payment requesting that the penalty charges be abated.

Recommendation: Once the taxpayer‚ or their representative‚ responds to an IRS notice (either by phone or correspondence)‚ NCCPAP recommends that the receipt of that contact is immediately entered into the IRS system‚ thereby putting a hold on the amount‚ so that no additional interest accrues. If the IRS determines that the taxpayer still owes the penalty charges‚ then the taxpayer would pay the remaining balance with no additional charges assessed.

Implementing a Firm PTIN‚ or FTIN

Issue: In order to safeguard the Personal Information (PI) of tax preparers‚ the IRS implemented the Preparer Tax ID Number (known at PTIN). While PTINs became a requirement in 2010‚ there is currently no protection for the firm itself.

Recommendation: The IRS should implement a Firm Tax ID Number (FTIN) similar to the PTIN program. The firm would be able to verify the number of returns prepared in a similar fashion to both the PTIN and EFIN‚ although we do not recommend using the firm’s EIN number for security reasons. NCCPAP feels that the FTIN program would be a benefit to the privacy and security of firm information.

Practitioners Want Direction from New Commissioner

Issue: The acting IRS Commissioner‚ David J. Kautter‚ will be addressing a range of upcoming tax administration issues.

Recommendation: As part of the IRS’s open dialogue with the tax professional community, NCCAP recommends an early indication of planned changes and modifications of administrative issues and procedures within the IRS.


NCCPAP will also meet with members of Congress on May 10.


Calculator

IRS W-4 and Withholding Calculator


The Tax Cuts and Jobs Act made changes to the tax law, including increasing the standard deduction, removing personal exemptions, increasing the child tax credit, limiting or discontinuing certain deductions and changing the tax rates and brackets.

If changes to withholding should be made, theWithholding Calculator gives employees the information they need to fill out and submit a newForm W-4, Employee's Withholding Allowance Certificate.


Tax Reform: Changes to Depreciation Affect Businesses Now

IRS Tax Reform Tax Tip 2018-68


As employers across the country celebrate National Small Business Week, the IRS reminds businesses that the passage of the Tax Cuts and Jobs Act may affect their depreciation deductions and taxes. Business taxpayers can generally depreciate tangible property except land, including buildings, machinery, vehicles, furniture and equipment. Changes to depreciation and how they will affect businesses may include:

•Businesses can immediately expense more under the new law; taxpayers may elect to expense the cost of any property and deduct it in the year the property is placed in service. •Maximum deduction increased from $500,000 to $1 million. •The phase-out threshold increased from $2 million to $2.5 million.
•The new law allows taxpayers to elect to include improvements made to nonresidential property. The improvements must have been made after the date the property was first placed in service.

These improvements include:
• Any improvement to a building’s interior
• Roofs
• Heating and air conditioning systems
• Fire protection systems
• Alarm and security systems

Improvements that do not qualify:
• Enlargement of the building
• Service to elevators or escalators
• Internal structural framework of the building

These changes apply to property placed in service in taxable years beginning after December 31, 2017.

Retirement Plans

Retirement Plans Can Make Harvey Loans


IR-2017-138
August 30, 2017
WASHINGTON --

The Internal Revenue Service today announced that 401(k)s and similar employer-sponsored retirement plans can make loans and hardship distributions to victims of Hurricane Harvey and members of their families.

Participants in 401(k) plans, employees of public schools and tax-exempt organizations with 403(b) tax-sheltered annuities, as well as state and local government employees with 457(b) deferred-compensation plans may be eligible to take advantage of these streamlined loan procedures and liberalized hardship distribution rules.

Retirement plans can provide this relief to employees and certain members of their families who live or work in disaster area localities affected by Hurricane Harvey and designated for individual assistance by the Federal Emergency Management Agency (FEMA). To qualify for this relief, hardship withdrawals must be made by Jan. 31, 2018.

More information


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