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Issue Number: 2022-05

Inside This Issue

1. IRS reminds employers of penalty relief related to claims for the Employee Retention Tax Credit
2. IRS Notices CP2100 and 2100A help payers correct backup withholding errors
3. Help improve IRS.gov: Participate in upcoming studies
4. Technical information
5. Offer in Compromise Form 656 Booklet updated for 2022 – Use current version to avoid processing issues
6. IRS seeks nominations for the 2023 Internal Revenue Service Advisory Council
7. IRS recognizes Small Business Week: Information and free resources for starting a business
8. New forms, instructions and publications on IRS.gov

Payroll professionals and others have asked for relief from penalties arising when additional income tax is owed because the deduction for qualified wages is reduced by the amount of a retroactively claimed Employee Retention Tax Credit (ERTC), but the taxpayer is unable to pay the additional income tax because the ERTC refund payment has not yet been received.

IRS news release 2022-89 reminds employers that, consistent with the relief from penalties for failure to timely pay noted in Notice 2021-49, they may be eligible for relief from penalties for failing to pay their taxes if they can show reasonable cause and not willful neglect for the failure to pay.

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Beginning in mid-April 2022, the IRS will send CP2100 and CP2100A notices to financial institutions, businesses or payers who filed certain types of information returns that don’t match IRS records.

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The IRS wants to make it easier for taxpayers to use IRS.gov by improving how the website is organized. Certain taxpayers may sign up to attend study sessions and tell the IRS how they want to find the information they need.

Participant eligibility requirements include:

• Must be 18 or older
• Must be an employer, small business owner or retirement plan administrator, or work for a tax-exempt organization
• May not be a current, or past, employee of the IRS or U.S. Department of the Treasury

Eligible taxpayers can sign up for one of the following 1-hour web conferencing sessions based on the category they fall into:

• Businesses
• Retirement plan administrators
• Tax-exempt entities, including charities and non-profits

Selected participants will receive an email from the IRS research team with details of how to attend.

The IRS plans future opportunities for taxpayers unable to participate these upcoming website organizational studies. Direct any questions about these studies to irsgovtesting@irs.gov.

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Revenue Procedure 2022-17 provides: (1) two tables of limitations on depreciation deductions for owners of passenger automobiles placed in service by the taxpayer during calendar year 2022; and (2) a table of dollar amounts that must be used to determine income inclusions by lessees of passenger automobiles with a lease term beginning in calendar year 2022. The tables detailing these depreciation limitations and amounts used to determine lessee income inclusions reflect the automobile price inflation adjustments required by section 280F(d)(7). For purposes of this revenue procedure, the term “passenger automobiles” includes trucks and vans.

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The IRS updated its Offer in Compromise Form 656 Booklet for 2022 on April 25, 2022. Taxpayers submitting offers to the IRS must use the most current year version of the booklet to avoid unnecessary issues with processing their offers. An updated Spanish version of the form is scheduled for release later this year.

The booklet contains all the forms necessary to submit an offer as an individual or business. Taxpayers thinking about submitting an offer will want to check out the IRS’s Offer in Compromise Pre-Qualifier Tool to make sure they’re eligible to file one. (Note: even though individuals and businesses can submit an offer, the tool is currently only available to individuals.)

The IRS also created an easy-to-navigate, OIC video playlist to help taxpayers to file an offer on their own and avoid paying excessive fees to companies advertising outlandish claims. Find more information on offers at IRS.gov/oic.

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The IRS is accepting applications for the Internal Revenue Service Advisory Council for 2023. Applications will be accepted through June 3, 2022.

Among other things, IRSAC is seeking applicants with experienced payment processors (such as credit card processors), colleges/universities and/or multinational corporations with experience filing information returns. IRS news release 2022-94 contains links to the application form and more information.

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This week is National Small Business Week (May 2 - 6), and the IRS wants taxpayers to know there are free resources on IRS.gov for those that are starting a business. Small businesses play a pivotal role in the nation's economy.

The IRS has a variety of resources available to help employers meet their tax responsibilities as well as help their employees. Please share this information with clients, employees and partners.

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Forms

• Form W-4 (ko), Employee's Withholding Certificate (Korean Version)
• Form W-4 (vie), Employee's Withholding Certificate (Vietnamese Version)

Instructions

• Inst 943-X (PR), Instructions for Form 943-X (PR), Adjusted Employer's Annual Federal Tax Return for Agricultural Employees or Claim for Refund (Puerto Rico Version)
• Inst 944-X (SP), Instructions for Form 944-X (SP), Adjusted Employer's ANNUAL Federal Tax Return or Claim for Refund (Spanish Version)

Publications

• Pub 505, Tax Withholding and Estimated Tax
• Pub 5369-A, Gig economy and your taxes

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