IRS FAQs Updated Frequently And Without Warning

IRS FAQs Updated Frequently And Without Warning

IRS Updates Frequently Asked Question (FAQ) Process

The IRS announced updates to its processes and policies for frequently asked questions (FAQs) and has provided guidance on the rules for implementing penalties for taxpayers who rely on FAQs.  FAQs often provide important interpretive guidance for taxpayers attempting to understand how new legislation will be implemented. However, the FAQs are updated frequently and without warning.

Going forward, FAQs will be announced in a news release and posted to in a fact sheet.

Prior versions of the fact sheet FAQs will now be dated and maintained on so that taxpayers can find the version they relied upon. The IRS also released a statement clarifying that if a taxpayer relies on FAQs in good faith and that reliance is reasonable, the taxpayer has a reasonable cause defense against any accuracy-related penalties and negligence penalties if it turns out that the FAQs were not a correct interpretation of the law given the facts.  However, the law itself will continue to control in the taxpayer’s case (not the FAQs). In the wake of the COVID-19 pandemic, IRS FAQs were often the only interpretive materials available.

William Byrnes

William H. Byrnes has achieved authoritative prominence with more than 20 books, treatise chapters and book supplements, 1,000 media articles, and the monthly subscriber Tax Facts Intelligence. Titles include: Lexis® Guide to FATCA Compliance, Foreign Tax and Trade Briefs, Practical Guide to U.S. Transfer Pricing, and Money Laundering, Asset Forfeiture; Recovery, and Compliance (a Global Guide). He is a principal author of the Tax Facts series. He was a Senior Manager, then Associate Director of international tax for Coopers and Lybrand, and practiced in Southern Africa, Western Europe, South East Asia, the Indian sub-continent, and the Caribbean. He has been commissioned by a number of governments on tax policy. Obtained the title of tenured law professor in 2005 at St. Thomas in Miami, and in 2008 the level of Associate Dean at Thomas Jefferson. William Byrnes pioneered online legal education in 1995, thereafter creating the first online LL.M. offered by an ABA accredited law school (International Taxation and Financial Services graduate program).

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