Emergency Preparedness and Hurricane Tax Extensions
Below is our summary of the Internal Revenue Service (IRS) key directions and relevant tax matters for the week of August 30, 2021 to September 3, 2021. Additionally, for ongoing updates on the tax impact COVID-19, please visit our resource page here.
August 30, 2021: September being National Preparedness Month, IRS reminded everyone to develop an emergency preparedness plan, especially as the hurricane season and the ongoing wildfires approach. . To prepare, taxpayers must secure and duplicate essential tax and financial documents.
August 31, 2021: The IRS has postponed various tax filing and payment deadlines for victims of Hurricane Ida. Affected individuals and businesses will have until January 3, 2022 to file their returns and pay any taxes that were initially due during that time. This means that people who had a valid extension to file their 2020 return which was due to expire on October 15, 2021, will now have until January 3, 2022 to file. However, tax payments related to 2020 tax returns that were due on May 17, 2021, are not eligible for this relief. This extension also applies to estimated quarterly income tax payments due on September 15, 2021.
September 1, 2021: The IRS has published a practice unit on General Principles of Foreign Tax Credits, specifically dealing with foreign tax credits as amended by the Tax Cuts and Jobs Act of 2017.
September 2, 2021: The IRS has issued final regulations, amending previous regulations relating to IRS administrative procedures, to reflect the limitations required by the enactment of the Taxpayer First Act of 2019. The regulations implement new rules regarding persons who may be provided with books, papers, records or other data obtained in accordance with Section 7602 of the Internal Revenue Code for the sole purpose of providing expert assessment and assistance to the IRS. The regulations adopt additional limitations on the type of non-government attorneys to whom books, documents, records or other data may be provided. Under the final regulations, IRS contractors are prohibited from asking substantive questions of a witness summoned under oath or asking the representative of a subpoenaed person to clarify an objection or assertion of privilege. .
September 3, 2021: IRS issued Tax Proceedings 2021-40, announcing that it would not issue private letter rulings or determination letters on whether certain transactions qualify as an act of self-operation in under Section 4941 of the Internal Revenue Code.
September 3, 2021: The IRS issued Notice 2021-52, providing daily travel rates for 2021-2022.
September 3, 2021: The IRS released its weekly list of written determinations (for example, private letter decisions, technical advice memoranda and advice from the chief counsel).
Special thanks to Emily Mussio from our Chicago office for this week’s roundup.