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Federal Tax Guidance Considerations (No Time For Public Comment Was Provided)



Federal Tax Guidance With No Public Comment

To help figure out all of the COVID-19 tax law changes enacted since March 2020, we have seen a variety of guidance from the IRS. This includes FAQs and some items just posted to an IRS website. These are non-binding items. Some guidance was published in the weekly Internal Revenue Bulletin (revenue rulings, revenue procedure, notices and announcements) so is binding on the IRS.

Since these changes mostly expired in less than one year, there wasn’t time for public comment and binding guidance for everything. Taxpayers and practitioners wanted insights as quickly as possible.

But what about other tax rules that are here for longer? Why aren’t regulations used more often particularly for unclear areas where public comments would be useful. For example, some of the information on taxation of virtual currency are FAQs or a revenue ruling where there was no public comments and there are issues as to whether the guidance is correct.

I’ve got a short article in the AICPA Tax Adviser that delves into types of guidance and some current issues. As this excerpt notes, the National Taxpayer Advocate has concerns too. “FAQs can be renumbered, removed, or modified with no archival remnant to help in finding the original. That is, the IRS has no responsibility to archive FAQs and other items only published on its website. In contrast, items published in the IRB are in a permanent depository. In a July 7, 2020, blog post, available at taxpayeradvocate.irs.gov, National Taxpayer Advocate Erin M. Collins noted this FAQ problem and described it as a violation of the Taxpayer Bill of Rights, namely, the rights to be informed and to a fair and just tax system.”

Please check it out as it explains various IRS pronouncements and their differences and issues, including a chart that I hope you find useful – here.

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Annette Nellen, CPA, Esq., is a professor in and director of San Jose State University’s graduate tax program (MST), teaching courses in tax research, accounting methods, property transactions, state taxation, employment tax, ethics, tax policy, tax reform, and high technology tax issues.

Annette is the immediate past chair of the AICPA Individual Taxation Technical Resource Panel and a current member of the Executive Committee of the Tax Section of the California Bar. Annette is a regular contributor to the AICPA Tax Insider and Corporate Taxation Insider e-newsletters. She is the author of BNA Portfolio #533, Amortization of Intangibles.

Annette has testified before the House Ways & Means Committee, Senate Finance Committee, California Assembly Revenue & Taxation Committee, and tax reform commissions and committees on various aspects of federal and state tax reform.

Prior to joining SJSU, Annette was with Ernst & Young and the IRS.

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