e-News for Tax Professionals 2021-13
Internal Revenue Service (IRS) sent this bulletin at 04/02/2021 06:01 PM EDT
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Issue Number: 2021-13Inside This Issue
1. Additional tax deadlines extended to May 17 for individuals Individuals have until May 17, 2021, to meet certain deadlines that would normally fall on April 15, such as making IRA contributions and filing certain claims for refund. 2. IRS, Treasury disburse more Economic Impact Payments; total tops 130 million with more to come The IRS, the U.S. Department of the Treasury and the Bureau of the Fiscal Service are disbursing several million more payments in the third batch of Economic Impact Payments from the American Rescue Plan. The total amount disbursed so far is more than 130 million payments worth approximately $335 billion. 3. IRS to recalculate taxes on unemployment benefits; refunds to start in May To help taxpayers, the IRS will take steps to automatically refund money to people who filed their tax return reporting unemployment compensation before the recent changes made by the American Rescue Plan. Because the change occurred after some people filed their taxes, the IRS will make the appropriate change to their return, which may result in a refund. The first refunds are expected to be made in May and will continue into the summer. 4. IRS projects stimulus payments to non-filer beneficiaries to be disbursed this weekend As work continues on issuing millions of Economic Impact Payments to Americans, the IRS and Treasury Department anticipate payments will begin to be issued this weekend to Social Security recipients and other federal beneficiaries who do not normally file a tax return. The projection is that the majority of these payments would be sent electronically and received on April 7. 5. Emergency aid granted to students due to COVID is not taxable Check out the frequently asked questions the IRS has issued on how students and higher education institutions should report pandemic-related emergency financial aid grants. 6. University students, staff: Beware of IRS impersonation scam Alert your clients of an ongoing IRS-impersonation scam that appears to primarily target educational institutions, including students and staff who have “.edu” email addresses. The suspect emails display the IRS logo and use various subject lines such as "Tax Refund Payment" or "Recalculation of your tax refund payment. 7. Several payment P.O. boxes closing in 2022 IRS is closing several individual payment P.O. boxes (or Lockbox addresses) in the San Francisco, Calif., and Hartford, Conn., areas beginning Jan. 1, 2022. Payments are currently being forwarded to Louisville, Ky., and Cincinnati, Ohio, through Dec. 31, 2021. However, payments mailed to these closed payment locations after Jan. 1, 2022, will be returned to sender. To help ensure timely receipt, IRS encourages you to avoid mailing to these closing addresses as there could be mail delays. Please check Where to File on irs.gov for active addresses, before mailing your payments. If you receive an IRS payment letter, send your payment to the address located in the letter. IRS encourages taxpayers to use IRS Direct Pay. It's fast, secure and easy to pay a tax bill or estimated tax payment directly from a checking or savings account. Users receive instant confirmation that their payment has been made. See Publication 3891, Lockbox Addresses for 2021, for more information. 8. Workshop helps small business owners understand, meet tax obligations Share the Small Business Virtual Tax Workshop with your clients. This free workshop, which is available anytime, helps educate small business owners about their taxes and how to meet their tax obligations. 9. News from the Justice Department’s Tax Division The U.S. has filed a complaint in the U.S. District Court for the Southern District of Florida, Miami Division, seeking to bar Gerald Vito and James Eleby, two Miami-area tax return preparers, from preparing federal income tax returns for others. The civil complaint filed against Vito, Eleby and Gerald Vito LLC dba Income Tax Services alleges that the defendants prepared federal income tax returns that significantly understated their customers’ tax liabilities. The complaint further alleges that in reporting their customers’ itemized deductions, defendants fabricated or inflated charitable deductions, medical expenses and employee business expenses. The complaint also alleges that defendants significantly understated their customers’ tax liabilities by reporting false or inflated business losses and that the defendants have harmed their customers, who could potentially be required to pay tax deficiencies, interests and penalties as a result of defendants’ conduct. The U.S. filed a complaint in the U.S. District Court for the Middle District of Georgia seeking to bar a Tifton, Ga., tax return preparer from preparing tax returns for others. The civil suit against Alicia Coarsey, aka Meredith Coarsey, and Tax Xpress of Tifton LLC, alleges that Coarsey owns Tax Xpress and prepares federal individual income tax returns claiming fabricated medical expenses, charitable contributions, business losses and, in some cases, losses for non-existent businesses, to claim improper earned income tax credits. The complaint further alleges that returns Coarsey prepares use these bogus claims to falsely understate her customers’ tax liabilities and inflate their refund claims. A federal court in the Northern District of Texas, Dallas Division, has permanently barred a Dallas-area tax return preparer from preparing federal income tax returns for others pursuant to a stipulated permanent injunction. The civil complaint filed in the case alleged that Keysha Briseño continually and repeatedly included false business losses and fabricated business expenses on some of her clients’ returns. According to the complaint, she, and her spouse allegedly own and operate a tax preparation business known under the names Tax Genius LLC; Tax Genie; and K&J Tax Service. The complaint alleged that Briseño controls Tax Genius and has prepared more than 4,200 tax returns between 2017 through 2019, more than 25 percent of which contained fabricated business losses. The complaint further alleged that after the IRS revoked her federal return preparer identification in 2012, Briseño continued to prepare tax returns using her sister’s preparer identification and her fraudulent return preparation activities have caused significant harm to her customers and resulted in millions of dollars in tax losses to the U.S. 10 Technical Guidance Announcement 2021-6 issued pursuant to section 521(b) of Pub. L. 106-170, the Ticket to Work and Work Incentives Improvement Act of 1999, which requires the Secretary of the Treasury to report annually to the public concerning advance pricing agreements (APAs) and the Advance Pricing and Mutual Agreement Program (APMA Program), formerly known as the Advance Pricing Agreement Program (APA Program). This twenty-second report describes the experience, structure, and activities of the APMA Program during calendar year 2020. Notice 2021-21 provides disaster relief, in the form of postponing certain federal tax filing and payment deadlines, and associated interest, penalties and additions to tax, for taxpayers filing Form 1040 series returns, who have been adversely affected by the COVID-19 pandemic. This notice also postpones, for individual taxpayers, the time for filing federal income tax refund claims due on April 15, 2021, and extends the time for return preparers to participate in the Annual Filing Season Program for the 2021 calendar year. Revenue Procedure 2021-18 provides an automatic procedure for a State or local government in which an empowerment zone is located to extend the empowerment zone designation made under section 1391(a) of the Internal Revenue Code (Code). Specifically, this revenue procedure provides that a State or local government that nominated an empowerment zone is deemed to extend until Dec. 31, 2025, the termination date designated by that State or local government in its empowerment zone nomination (designated termination date), as described in section 1391(d)(1)(B). This revenue procedure further provides the procedure for such State or local government to decline this deemed extension of its designated termination date.
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