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Issue Number:  2018-7

Inside This Issue

1. Urge your clients to check withholding now to avoid tax surprises later
2. Employer credit for family and medical leave
3. Starting September 23, individual tax transcripts will redact personal ID information
4. Technical guidance
5. Draft forms and instructions on IRS.gov
6. New forms and pubs on IRS.gov

A summertime check on tax withholding is critical for taxpayers who haven't reviewed their tax situation. The Tax Cuts and Jobs Act, enacted in December, made major changes to the tax law. Any of these far-reaching changes could affect the refund taxpayers may receive when they file their 2018 tax return.

The IRS encourages every employee, including those who typically receive big tax refunds, to do a “Paycheck Checkup” soon to see if they have the appropriate amount of tax taken out of their pay. Get more information on Paycheck Checkup:

Instructional YouTube videos to share with your clients:

• Paycheck Checkup
• IRS Withholding Calculator Tips
• Do I Need to Fill Out a New W-4?

News releases for sharing:

• Got a big tax refund? Use IRS Withholding Calculator to boost take-home pay in 2018
• Taxpayers with high incomes, complex returns: Check withholding soon
• Key tax change affects taxpayers with dependents; IRS urges workers to check withholding
• Taxpayers with children, other dependents should check their withholding soon
• For people involved in the sharing economy: Do a ‘Paycheck Checkup’ now, avoid a surprise year-end tax bill

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Employers may claim the credit based on wages paid to qualifying employees while they are on family and medical leave. Find more information on who qualifies, what “family and medical leave” includes and other considerations that affect wages.

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Moving to better protect taxpayer data, the Internal Revenue Service announced a new format for individual tax transcripts that will redact personally identifiable information from the Form 1040 series.

This new transcript replaces the previous format and will be the default format available via Get Transcript Online, Get Transcript by Mail or the Transcript Delivery System for tax professionals as of September 23. Financial entries will remain visible, which will give taxpayers and third-parties the data they need for tax preparation or income verification.

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Notice 2018-64 proposes a revenue procedure that provides guidance on methods for calculating W-2 wages for purposes of section 199A, Deduction of Qualified Business Income, of the Internal Revenue Code and proposed sections of the Income Tax Regulations.

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Forms:

• Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return
• Form 940, (Schedule A), Multi-State Employer and Credit Reduction Information
• Form 1095-A, Health Insurance Marketplace Statement
• Form 1095-C, Employer-Provided Health Insurance Offer and Coverage
• Form 4852, Substitute for Form W-2, Wage and Tax Statement, or Form 1099R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRA's Insurance Contracts, Etc.
• Form 8885, Health Coverage Tax Credit
• Form 8959, Additional Medicare Tax
• Form 8962, Premium Tax Credit

Instructions:

• Inst 940, Instructions for Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return
• Inst 8885, Instructions for Form 8885, Health Coverage Tax Credit

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Forms:

• Form 4419, Application for Filing Information Returns Electronically (FIRE)

Pubs:

• Pub 1281, Backup Withholding for Missing and Incorrect Name/TINs (including instructions for reading tape cartridges and CD/DVD formats)  
• Pub 5303, Paycheck Checkup

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