IRS practice & procedure

The proposed regulations, which the IRS said would affect millions of children, families, and employers, also address self-employed owners, Sec. 125 cafeteria-plan contributions, and employer matching of the government’s $1,000 pilot-program contribution.

Workers generally may claim the overtime pay deduction only for amounts reported on Form W-2, Wage and Tax Statement, beginning in tax year 2026, according to updated IRS FAQs. The IRS also clarified that the deduction does not make overtime pay exempt from gross income.

Eligible businesses and organizations can now view more digital notices, make payments on installment agreements, and obtain EIN verification documents online.

The guidance explains how employers can claim the expanded credit for paid family and medical leave beginning in 2026 using a premium-based method.

The IRS said fraudsters are mailing letters that direct digital asset holders to a bogus “Digital Asset Compliance Portal” that mimics IRS.gov to collect personal information.

The Senate Finance Committee approved the Taxpayer Assistance and Service Act, legislation backed by the AICPA that would modernize IRS operations, expand taxpayer services, and give the IRS authority to deny, revoke, or suspend preparer tax identification numbers.

The midyear change follows an increase in gasoline prices, according to the IRS. It is the first such midyear adjustment since 2022.

The final regulations target arrangements that the IRS says improperly use charitable remainder annuity trusts and annuities to eliminate ordinary income and capital gain on the sale of property.

Under the new system, eligible taxpayers will no longer have to request penalty relief that the IRS says is routinely granted.

Certain taxpayers with IRS online accounts can file a Kwong-related refund claim on Form 843 through a new secure application before a Friday deadline.

The request follows reports from taxpayers who said they received notices despite not expecting a refund or having already provided direct deposit information.

The guidance sets forth conditions for contributions to qualify for the annual gift tax exclusion and for donors to avoid filing gift tax returns.

The national taxpayer advocate’s Fiscal Year 2027 Objectives Report to Congress says the IRS processed about 139 million returns and handled most refunds smoothly but says the story was different for taxpayers who needed help from a human being.

The Supreme Court declined to hear an appeal of the Third Circuit’s decision in Murrin, in which the court held that taxpayer intent is not required for the unlimited period for assessing tax under Sec. 6501(c)(1) to apply.

The Treasury Inspector General for Tax Administration estimated that about 1 million callers to two IRS customer service lines did not receive quality service.