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☆ Tax pros brace for ‘tidal wave’ of crypto tax scrutiny from the IRS. What investors need to know
▼ + stars: | 2024-03-04 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

As the IRS bolsters its cryptocurrency expertise, tax professionals are bracing for increased scrutiny of digital currency. The IRS announced it hired two former crypto executives to beef up its digital currency service, reporting, compliance and enforcement programs. "Everybody's been waiting for the tidal wave of this enforcement activity," said James Creech, an attorney and senior manager at accounting firm Baker Tilly. More from Personal Finance:IRS targets wealthy 'non-filers' with new wave of compliance letters4 red flags for an IRS tax audit — and how to avoid the 'audit lottery'IRS aims to close 'inequity gap' for unpaid taxes. These actions will trigger a "significant amount" of crypto enforcement, said Hylton, who is a former IRS commissioner for the agency's small business and self-employed division.

Persons: Everybody's, James Creech, Baker Tilly, Eric Hylton, John Doe, Hylton Organizations: IRS, Finance, Alliantgroup

☆ IRS aims to close 'inequity gap' for unpaid taxes. How the agency targets top earners for audit
▼ + stars: | 2024-02-20 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

IRS Commissioner Daniel Werfel testifies before the Senate Finance Committee on April 19, 2023. The tax gap, or the difference between taxes owed and paid, was an estimated $688 billion for tax year 2021, the IRS reported in October. Instead, profits flow through to the business owners' tax returns. Other 'red flags' for higher earnersIn addition to complex partnerships, the IRS is watching for other "red flags" from higher earners, according to Hylton. Another area of for increased audits could be estate and gift tax returns, particularly those using "aggressive valuation discounts" for assets, Hylton said.

Persons: Daniel Werfel, Chip Somodevilla, Danny Werfel, Werfel, Eric Hylton, Hylton, Colin Walsh, Baker Tilly, Baker Organizations: Senate, IRS, Alliantgroup Locations: U.S, Hylton, Puerto Rico

☆ What to know as IRS kicks off withdrawal option for pandemic-era small business tax credit
▼ + stars: | 2023-10-23 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

The Good Brigade | Digitalvision | Getty ImagesThe IRS has announced a special withdrawal process for small businesses that wrongly claimed a pandemic-era tax break — and experts have tips for those who may be affected. Worth thousands per eligible employee, the ERC attracted a cottage industry of companies pressuring small businesses to amend payroll tax returns and wrongly claim the credit. The IRS on Thursday unveiled a withdrawal option for small businesses with pending ERC claims before facing repayment, interest and penalties. "This is a game-changer," said Eric Hylton, national director of compliance for Alliantgroup, a firm that has been reviewing ERC claims for other tax professionals. As of Oct. 11, the agency estimated a backlog of 849,000 Forms 941-X, which includes ERC claims.

Persons: Eric Hylton, I'm, Hylton, you've, there's, It's, Dean Zerbe, Zerbe Organizations: Brigade, IRS, ERC, Alliantgroup Locations: Worth, It's

☆ IRS to offer free online direct filing system for some taxpayers in 2024
▼ + stars: | 2023-05-17 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

Jayme Thornton | Tooga Productions | Getty ImagesPushback from the tax prep industryWhile some Democrats and consumer advocates have pushed for a direct filing system for years, there has already been pushback from Republicans and the tax preparation industry. "The IRS direct e-file pilot set to start in January 2024 continues to be a solution in search of a problem," a spokesperson for H&R Block said in a statement. "With more than 30 organizations already offering free tax preparation, this pilot is unnecessary and faces significant barriers to providing comprehensive tax preparation services." It is a watershed moment for the tax system. "It is a watershed moment for the tax system," said Mark Everson, a former IRS commissioner and current vice chairman at Alliantgroup.

☆ Premarket stocks: What happens if the debt ceiling and banking crisis collide?
▼ + stars: | 2023-05-15 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +7 min

New York CNN —President Joe Biden said over the weekend that debt ceiling negotiations were moving along and that talks between the White House and House Speaker Kevin McCarthy would resume on Tuesday. It may become more difficult to access credit, further exacerbating the challenges individuals and companies are already facing because of the banking crisis. Before the Bell: What do the ongoing debt ceiling negotiations mean to small and medium businesses? Do you think bank executives and members of the business community can put pressure on Congress and the White House to come to a deal? The White House has estimated more than 8 million jobs would get wiped out if there is a protracted default.

☆ The Biden tax proposals that could hit baby boomer, family businesses
▼ + stars: | 2023-04-29 | by ( Cheryl Winokur Munk | ) www.cnbc.com time to read: +7 min

President Joe Biden's 2024 budget proposals contain several proposals that could hit small businesses right where it hurts — their wallets. Here are five provisions business owners should be aware of in President Biden's budget:A higher capital gains tax rate would be bad for business sellers. Biden is proposing that the corporate tax rate be increased to 28% from 21%. The majority of small businesses are pass-through businesses that are not subject to the corporate income tax, but for companies that are, the increase would be meaningful, tax experts said. Biden's proposal would increase the 3.8% net investment income tax rate on small business income over $400,000 to 5%.

☆ The IRS released its $80 billion funding plan. Here's what it means for taxpayers
▼ + stars: | 2023-04-07 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

IRS Commissioner Daniel Werfel testifies before a Senate Finance Committee hearing on Feb. 15, 2023. Kevin Lamarque | ReutersThe IRS on Thursday released a plan for the nearly $80 billion in agency funding enacted through the Inflation Reduction Act in August — including expected boosts for customer service, technology and enforcement. "Now that we have long-term funding, the IRS has an opportunity to transform our operations and provide the service that people deserve," IRS Commissioner Danny Werfel told reporters on a press call. IRS tools will help taxpayers identify their mistakes before filing returns, and upgrades may help resolve filers' errors more quickly. "That's a departure from the organization's traditions," said Mark Everson, a former IRS commissioner and current vice chairman at Alliantgroup.

☆ Here's why IRS tax audits have declined over the past decade
▼ + stars: | 2023-04-01 | by ( Charlotte Morabito | In Charlottemorabito | ) www.cnbc.com time to read: +2 min

Tax season is upon us, and along with it comes the ensuing bout of paranoia about the dreaded IRS audit. In 2022, the IRS audited 3.8 out of every 1,000 income tax returns. The GAO report concludes that a drop in IRS funding was a main contributor to the decline in audits. Janet Holtzblatt senior fellow at the Urban-Brookings Tax Policy CenterAbout 70% of the IRS's overall budget is spent on labor. "Someone who's three years out of college isn't going to be doing the technical work on the ExxonMobil tax return.

☆ IRS commissioner nomination advances amid debate over $80 billion agency funding
▼ + stars: | 2023-03-03 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +2 min

Sen. Ron Wyden, D-Ore., speaks during a Senate Finance Committee nomination hearing on Feb. 23, 2021. Greg Nash | Pool | ReutersThe Senate Finance Committee this week voted to advance Daniel Werfel's nomination to become IRS commissioner amid fierce debate over the agency's $80 billion in funding. Following a confirmation hearing on Feb. 15, the bipartisan committee vote was the final step before a full Senate vote for confirmation. Senate Finance Committee Chair Ron Wyden, D-Ore., said Werfel's February testimony demonstrated he's a "rule follower" who will work with "both sides of the Committee." Oversight of IRS funding is a priority for RepublicansThe Senate Finance Committee vote comes amid continued scrutiny of the $80 billion in IRS funding allocated in August through the Inflation Reduction Act.

☆ IRS commissioner nominee to 'ensure that America's highest earners comply with tax laws.' Here are the key takeaways from Senate hearing
▼ + stars: | 2023-02-16 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +3 min

Senate Finance Committee Chairman Ron Wyden, D-Ore., questions IRS Commissioner Charles Rettig at a Senate Finance Committee hearing. Tom Williams | Pool | ReutersPresident Joe Biden's nominee to lead the IRS answered questions during a Senate Finance Committee hearing this week, highlighting key issues from lawmakers on both sides of the aisle. If I am fortunate enough to be confirmed, the audit and compliance priorities will be focused on enhancing IRS' capabilities to ensure that America's highest earners comply with tax laws. Daniel Werfel IRS Commissioner nominee"Just because [Werfel's hearing] was smooth doesn't mean there won't be a fairly charged environment with the House in Republican hands and the election coming," Everson said. During fiscal 2022, millionaires faced a 1.1% chance of an IRS audit, according to a recent report from Syracuse University's Transactional Records Access Clearinghouse.

☆ House Republicans vote to strip IRS funding, following pledge to repeal nearly $80 billion approved by Congress
▼ + stars: | 2023-01-10 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

New U.S. Speaker of the House Kevin McCarthy, R-Calif., speaks with reporters in Washington, Jan. 7, 2023. House Republicans on Monday night voted to slash funding for the IRS, following a pledge from newly-elected Speaker Kevin McCarthy to repeal the money approved by Congress last year. The measure doesn't have the support to pass in the Democratic-controlled Senate, and the White House opposed the bill in a statement released Monday. The bill comes less than two weeks after Democratic members of the House Ways and Means Committee released six years of former President Donald Trump's tax returns, angering many Republican lawmakers. Known as the Family and Small Business Taxpayer Protection Act, the new House Republican measure would increase the budget deficit by more than $114 billion through 2032, according to the Congressional Budget Office.

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