‘Postcard’ Form 1040 debuts — with sheaf of schedules
The IRS issued a draft version of the 2018 Form 1040, U.S. Individual Income Tax Return, in June that reduces the size of the form to two half-pages but moves many items to six new schedules:
- Schedule 1, Additional Income and Adjustments to Income;
- Schedule 2, Tax, which includes the "kiddie tax," alternative minimum tax, and excess advance premium tax credit;
- Schedule 3, Nonrefundable Credits;
- Schedule 4, Other Taxes, such as household employment taxes, the health care individual responsibility payment, the net investment income tax, and the additional Medicare tax;
- Schedule 5, Other Payments and Refundable Credits, such as estimated tax payments, the net premium tax credit, and amounts paid with an extension request; and
- Schedule 6, Foreign Address and Third Party Designee.
Disguised-sale temporary regs. withdrawn
In REG-131186-17, the IRS announced that it will withdraw the temporary regulations issued in T.D. 9788, which addressed the Sec. 707 allocation of partnership liabilities for disguised-sale purposes, and proposed to reinstate the prior regulations under Regs. Sec. 1.707-5(a)(2). The IRS, however, announced that it is keeping the regulations on bottom-dollar guarantees that were also part of T.D. 9788. The withdrawal was in response to President Donald Trump's Executive Order 13789 to reduce regulatory burdens. Partners and partnerships may rely on the rules in these proposed regulations in lieu of the Sec. 707 temporary regulations for any transaction in which all transfers occurred after Jan. 3, 2017.