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Tag Archive for Relief

Guidance For Coronavirus-Related Distributions And Loans From Retirement Plans Under The CARES Act

Guidance For Coronavirus-Related Distributions And Loans From Retirement Plans Under The CARES Act

IRS Notice 2020-50 PURPOSE

This notice provides guidance relating to the application of section 2202 of the Coronavirus Aid, Relief, and Economic Security Act, Pub. L. 116-136, 134 Stat. 281 (2020) (CARES Act) for qualified individuals and eligible retirement plans. The CARES Act was enacted on March 27, 2020. Under section 2202 of the CARES Act, qualified individuals receive favorable tax treatment with respect
to distributions from eligible retirement plans that are coronavirus-related distributions. A coronavirus-related distribution is not subject to the 10% additional tax under § 72(t) of the Internal Revenue Code (Code) (including the 25% additional tax under § 72(t)(6) for certain distributions from SIMPLE IRAs), generally is includible in income over a 3-year period, and, to the extent the distribution is eligible for tax-free rollover treatment and is contributed to an eligible retirement plan within a 3-year period, will not be includible in income.

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Innocent Spouse Relief May Get Faster… Or Maybe Not

TaxConnections Picture - Marriage CelebrationIRS provides updated guidance for equitable innocent spouse relief requests

RIA, a large Tax Publisher, reported on revisions to Innocent Spouse relief requests. It has been extremely difficult (if not practically impossible) for married couples still living together to have one spouse qualify under the “innocent spouse” relief provisions. Even in situations where one spouse has illegal earnings, or has a huge increase in tax due to a business audit, the IRS almost always rejects the Innocent Spouse claim. The main argument is the spouse “benefited” from the income and higher life style and therefore should have known of the misreported income or expenses.

In addition to the usual denial of relief, the extremely long time for the IRS to process the requests, makes it costly and annoying. Supposedly, there will be a “streamlined” request. Usually, when the IRS announces such “reforms” they really do not mean much for most taxpayers. In this case, I think this may
benefit taxpayers who are current in tax filings but can claim abuse or some other type of coercion. Short of that, I do not think this will do much. Read more

Colorado Individual and Business Taxpayers Impacted by Storms Receive IRS Relief

TaxConnections Storm ReliefAccording to the IRS:

“certain taxpayers in the counties of Adams, Boulder, Larimer and Weld will receive tax relief, and other locations may be added in coming days following additional damage assessments by the Federal Emergency Management Agency (FEMA).“

The tax relief postpones some tax filing and payment deadlines to Dec. 2, 2013.

Additionally the IRS states:

“Corporations and Businesses that previously filed an automatic an extension until Sept. 16, 2013, to file their 2012 returns and individuals and businesses that received a similar extension until Oct. 15 will now have until December 2nd 2013 to both file and pay.”

This deadline also applies to estimated tax payments for the third quarter of 2013 due September 16th. Read more