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Issue Number:  2018-3

Inside This Issue

1. New on IRS.gov
2. Updated 2018 Withholding Tables Now Available
3. January 17 webinar, The Office of Professional Responsibility: What You Need to Know about Practicing before the IRS - Rebroadcast
4. What the New Tax Law Means for You and Your Clients
5. Protect Your Clients, Protect Yourself
6. Tax Filing Season Begins Jan. 29, Tax Returns Due April 17
7. Technical Guidance

Pub 1494, Table for Figuring Amount Exempt from Levy on Wages, Salary, and Other Income (Forms 668-W(ACS), 668-W(c)(DO) and 668-W(ICS))
Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons
Form 1042-S, Foreign Person's U.S. Source Income Subject to Withholding  
Inst 1042, Instructions for Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons
Pub 4163, Modernized e-File (MeF) Information for Authorized IRS e-file Providers for Business Returns
Form 8959, Additional Medicare Tax
Inst 8959, Instructions for Form 8959, Additional Medicare Tax

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IR-2018-5, January, 11, 2018

The IRS released Notice 1036, which updates the income-tax withholding tables for 2018 reflecting changes made by the tax reform legislation enacted last month. This is the first in a series of steps that IRS will take to help improve the accuracy of withholding following major changes made by the new tax law.

Employers should begin using the 2018 withholding tables as soon as possible, but not later than Feb. 15, 2018. They should continue to use the 2017 withholding tables until implementing the 2018 withholding tables.

The new withholding tables are designed to work with the Forms W-4 that workers have already filed with their employers to claim withholding allowances. This will minimize burden on taxpayers and employers.

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Register for the Office of Professional Responsibility’s Wednesday January 17 webinar, What You Need to Know about Practicing before the IRS – rebroadcast

This event features OPR’s Director Stephen Whitlock and ends with a new Q&A session.

Topics include:

• Regulations governing tax practice before the IRS
• Due diligence obligations of tax professionals
• Overview of other key Circular 230 provisions
• Practitioner responsibilities to clients and the tax administration system
• Best practices for tax professionals
• OPR policies and procedures  

To receive two hours Continuing Education Credit you must attend at least 100 minutes of the presentation.

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The IRS is reviewing the new tax law and preparing to implement provisions that will affect you and your clients in the weeks and months ahead. Stay up to date on the 2018 federal withholding rules and other changes by reading this newsletter, e-News for Payroll Professionals, bookmarking the newsroom on IRS.gov and following the IRS on Twitter at @IRSTaxPros.

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Every tax professional in the United States — whether a member of a major accounting firm or an owner of a one-person storefront — is a potential target for highly sophisticated, well-funded and technologically adept cybercriminals around the world. Their objective is to steal your clients’ data so they can file fraudulent tax returns that better impersonate their victims.

To stay ahead of the criminals, bookmark Protect Your Clients, Protect Yourself on IRS.gov.

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The IRS will begin accepting tax returns on Jan. 29, with nearly 155 million individual tax returns expected to be filed in 2018. The nation’s tax deadline will be April 17 this year — so taxpayers will have two additional days to file beyond April 15.

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Notice 2018-3 provides the optional standard mileage rates for 2018 for taxpayers to use in computing the deductible costs of operating an automobile for business, charitable, medical or moving expense purposes.  The notice also provides the amount taxpayers must use in calculating reductions to basis for depreciation taken under the business standard mileage rate, and the maximum standard automobile cost that a taxpayer may use in computing the allowance under a fixed and variable rate plan. The standard mileage rate for transportation or travel expenses is 54.5 cents per mile for all miles of business use (business standard mileage rate). See section 4 of Rev. Proc. 2010-51. The standard mileage rate is 14 cents per mile for use of an automobile in rendering gratuitous services to a charitable organization under § 170. See section 5 of Rev. Proc. 2010-51.

The standard mileage rate is 18 cents per mile for use of an automobile (1) for medical care described in § 213, or (2) as part of a move for which the expenses are deductible under § 217. See section 5 of Rev. Proc. 2010-51.

Notice 2018-06 extends the due dates for certain 2017 information reporting requirements for insurers, self-insuring employers, and certain other providers of minimum essential coverage under section 6055 and for applicable large employers under section 6056. Specifically, this notice extends the due date for furnishing to individuals the 2017 Form 1095-B, Health Coverage, and the 2017 Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, from January 31, 2018, to March 2, 2018. This notice also extends transitional good-faith relief from section 6721 and 6722 penalties to the 2017 information reporting requirements under sections 6055 and 6056.

This 30-day extension is automatic

All Forms 8809, Application for Extension of Time to File Information Returns, filed on paper are now processed by the Internal Revenue Service Center in Ogden, Utah. These paper forms must be mailed. Faxes will not be accepted.  

The mailing address is:  

Department of the Treasury
Internal Revenue Service Center
Ogden, UT 84201-0209  

The IRS will only grant extensions for very specific reasons. For example, records were lost in a disaster or someone responsible for filing the company’s returns has an unavoidable absence. You can get details on these and other exceptions on Form 8809.

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