Tax Reform
Don’t forget to check the IRS.gov Tax Reform pages regularly for the latest information.
Changes to Transcript Delivery
The Internal Revenue Service will stop its tax transcript faxing service June 28 and will amend the Form 4506 series to end third-party mailing of tax returns and transcripts in July.
- See News Release IR-2019-101 for more information.
- Attend the webinar: June 19, 2 p.m. EDT – Tax Transcripts: Alternatives to Faxing and Third-Party Mailing.
Enrolled Agent Application and Renewal User Fee Increase
The enrolled agent application and renewal user fee increases from $30 to $67 effective June 12, 2019. The IRS will not implement the increased EA user fee until November 1, 2019, which is when the next EA renewal period begins. The fee will increase at that time for both new applications and for renewals.
See the final regulations for more information.
Don’t Forget to Update Your IRS e-File Application
Authorized IRS e-file Providers (Providers) should ensure that the IRS has current information by reviewing and updating their IRS e-file Applications. The IRS removes Providers from participation in IRS e-file when it receives undeliverable mail or is unable to contact a Provider.
NOTE: Changes submitted on an IRS e-file Application do not change the address of record for a business’ tax records, just as a change to tax records does not automatically update information on a Provider’s IRS e-file Application.
See Publication 3112 IRS e-file Application and Participation.
Corrected Schedule D Tax Worksheet (Form 1040)
The 2018 Schedule D Tax Worksheet in the Instructions for Schedule D (Form 1040) contained an error. The tax calculation did not work correctly with the new TCJA regular tax rates and brackets for certain Schedule D filers who had 28% rate gain or unrecaptured section 1250 gain. If you downloaded those instructions before May 16, 2019, you should download them again. Because the IRS has already provided the corrected worksheet to its tax software partners, anyone filing a 2018 return, including those with extensions, after May 15, 2019, are not affected by the error. Affected taxpayers need not file an amended return with the IRS or call the IRS. The IRS is reviewing returns submitted prior to May 16; more information will be provided about this review later.
For more information see Error in Tax Calculation in Schedule D Tax Worksheet (Form 1040).
First draft of 2020 Form W-4 Now Available for Viewing and Comments
You can now view the IRS early draft of the 2020 Form W-4. If you have comments about this draft of Form W-4, you can submit them to [email protected]. Comments should be submitted by July 1, 2019.
Draft employer instructions related to this draft form W-4 can be found in Draft Publication 15-T, Federal Income Tax Withholding Methods.
For more information see IR-2019-98 IRS, Treasury unveil proposed W-4 design for 2020
Regional Practitioner Meetings. Registration Open
July 16 – Tyler, Texas
July 18 – Houston, Texas
July 25 – Santa Fe, New Mexico
August 9 – El Paso, Texas
August 13 – Amarillo, Texas
August 20 – Corpus Christi, Texas
August 22 – Edinburg, Texas
August 22 – Huntsville, Texas
Follow-ups from prior meetings:
Information on IRS.gov Regarding Transcript Delivery to the SOR
Issue: Practitioners suggested having more information posted to IRS.gov regarding this new procedure.
Response: The following information is posted to IRS.gov:
- News Release IR-2019-101 for more information.
- There will be a webinar for tax professionals June 19, 2 p.m. EDT – Tax Transcripts: Alternatives to Faxing and Third-Party Mailing
- FS-2018-20, Steps for tax professionals to obtain wage and income transcripts needed for tax preparation
- About the New Tax Transcript: FAQs
Action: Let us know what additional information you feel is needed, the type of vehicle you think would be most helpful (update to existing page, fact sheet, tax tip, news release, other) and any pages where you feel a link to the current information would be helpful.
Transcript Request Limit
Issue: Why is there still a limit of only 10 transcripts when they are no longer being faxed?
Response: The number of pages that can be faxed is limited based on the file size of the request and cannot exceed the Outlook Exchange size limit of 10 MB. Due to the length of time to process each page on the receiving end, a recommended page limit is 100 pages. There are no page limitations for delivery to the SOR. See IRM 21.2.3.4.
The limitation of 10 transcripts per taxpayer is a policy of Practitioner Priority Services. See IRM 21.3.10.4.4 Transcript Requests.
Status: Closed.
Hold Times on Toll-Free Numbers
Issue: The practitioner wanted to verify that PPS initiated a policy that the customer service representative could not be placed on hold for more than 2 minutes. They pointed out that this could be a real problem if it takes more than 2 minutes to fax in an authorization or other documentation.
Response: IRM 21.1.1.4 indicates that if the caller asks the Customer Service Representative to hold, the CSR should explain they can hold for no more than two minutes before moving to the next call. However, there is also a note that if the CSR must receive a fax from the caller, they should verify the fax number, confirm how long it will take to receive the fax and then return to the caller within that time frame.
Status: Closed.
New Issues:
Form 2848 Not Input – Box 6 Checked
Issue: Practitioner submitted a 2848 with box 6 checked and an earlier authorization attached but the CAF unit returned the authorization.
Response: When the IRS records a power of attorney on the CAF system, it generally will revoke any earlier power of attorney previously recorded on the system for the same matter. If you do not want to revoke any existing power(s) of attorney on file for the same matter, you should check the box on line 6 and attach a copy of the power(s) of attorney you wish to retain. (See the instructions for Form 2848.) By same matter, we mean the same year (or period) and tax type.
An authorization for 1040 taxes for 2016 would not affect an authorization already on file for taxes on 2015 because these are not the same matters.
If you check the box on line 6 and attach an authorization that covers anything other than the same matters on your new authorization, your authorization will not be processed.
In addition, filing Form 2848 will not revoke any Form 8821 that is in effect. Do not check box 6 because you want to retain an authorization submitted on Form 8821.
Status: Closed.
Form 2848 Not Accepted – Title of Signer
Issue: Practitioners report authorizations not being honored because of the title used by the taxpayer who signed the Form 2848. For example, the customer service representative rejected an authorization because the title was missing for a sole proprietor even though the name of the sole proprietorship and the signer were the same.
Response: IRM 21.3.7.5.1 lists the essential elements for Forms 2848 and 8821. If an essential element is missing or incomplete, the authorization is invalid. One of the elements when submitting an authorization for a business account is the title of the signer. However, it is acceptable for the CAF unit to edit Sole Proprietor as the owner for the authorization when EIN is valid for Sole Proprietor and the title is missing. These authorizations should get input to the CAF.
Action: We will elevate the issue regarding the CSRs not honoring the authorizations for this reason.
Status: Open
Authorization Not Accepted – Illegible
Issue: Practitioners report authorizations being returned because they are illegible. The document was legible when they faxed it, is there a problem with IRS printing the faxes?
Response: We will look into this issue.
Status: Open.
Caller ID on Notices
Issue: Practitioner received a copy of CP 504 – Final Notice – Balance Due with a caller ID included under the number to call. He did not need the caller ID when calling the phone number, so he wondered what it was for.
Response: The Caller ID number is used with some of our automated systems, such as the Online Payment Agreement. Power of Attorneys who have filed Form 2848 and are authorized to represent a taxpayer may use OPA on their client’s behalf. To authorize, the POA must enter;
- Taxpayer’s SSN or ITIN
- Their Centralized Authorization File (CAF) number, and
- Either the six-digit Caller ID number from the taxpayer’s notice or signature date on Form 2848
For more information on this and other systems that use the Caller ID see IRM 21.2.1.
Status: Closed.
Publication Sent with Notice
Issue: Practitioner feels that the publication included with the proposed assessment made by a correspondence exam should include information regarding the taxpayer’s right to appeal the decision.
Response: Please provide us with a copy of the notice and the number of the publication.
Status: Open