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IRS Launches Online Payment, Transcript Services
The IRS has begun IRS Direct Pay, a web-based resource that allows taxpayers to pay tax bills or make estimated tax payments (tinyurl.com/lktuq8c). Taxpayers must have a Social Security number to use the service, which also allows them to schedule payments up to 30 days in advance and check the status of pending payments. Another web application, Get Transcript, allows taxpayers to obtain a record of their IRS account (tinyurl.com/lx7qw6x). The IRS next plans to streamline applying for installment agreements (by taxpayers or their authorized representatives) by revamping its Online Payment Agreement Application page (tinyurl.com/d67hvvu).


Small Businesses Can Get Late-Filing Relief for Retirement Plan Reports
The IRS launched a temporary pilot program offering penalty relief for delinquent filing by plan sponsors and administrators of Form 5500, Annual Return/Report of Employee Benefit Plan, and its short and EZ versions, as applicable (Rev. Proc. 2014-32). For one year starting June 2, the IRS will relieve penalties under Secs. 6047(e), 6058, and 6059. The relief is available only with respect to plans not subject to Title 1 of ERISA (Employee Retirement Income Security Act of 1974). Thus, the relief generally is available only for plans that cover only the owner of a business (and spouse) or one or more partners (and spouse or spouses) in a business partnership (“one-owner” plans), and foreign plans. Relief is not available for a delinquent return for which a penalty has been assessed. Participants must file a complete Form 5500 series return for each delinquent year, in the form and manner described in the revenue procedure.


TIGTA Finds $2.3 Billion Alimony Tax Gap
Approximately $2.3 billion more in alimony was deducted by taxpayers than included in income by its recipients for 2010, the Treasury Inspector General for Tax Administration (TIGTA) reported (Rep’t No. 2014-40-022). For 47% of returns with deductions, no alimony income was reported on a corresponding recipient’s return, or the amount reported did not correspond with the deduction. TIGTA faulted examination policies including a deduction dollar amount trigger that prevented the IRS from detecting many mismatches and, in some cases, failure of taxpayers claiming deductions to provide recipients’ taxpayer identification number as required.

Where to find January’s flipbook issue

Starting this month, all Association magazines — the Journal of Accountancy, The Tax Adviser, and FM magazine (coming in February) — are completely digital. Read more about the change and get tips on how to access the new flipbook digital issues.

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Get your clients ready for tax season

Upon its enactment in March, the American Rescue Plan Act (ARPA) introduced many new tax changes, some of which retroactively affected 2020 returns. Making the right moves now can help you mitigate any surprises heading into 2022.