In late March 2020, the IRS issued Letters 6336 to participants in micro-captive insurance transactions. The participants were identified based upon the disclosure statements (IRS Forms 8886) included within their federal tax returns filings identifying participation in a program. These letters were issued to notify participants of the IRS’s recent successes in challenging the validity of the micro-captive program and requesting that they notify the IRS if participation was terminated.
Civil Tax Disputes & Litigation
Tax Relief Provided by CARES Act
Here is a quick update you on some of the applicable tax-related provisions in the Coronavirus Aid, Relief, and Economic Security (CARES) Act that was signed into law on March 27, 2020.
Recovery rebates for individuals. The CARES Act provides for the government to send up to $1,200 payments to eligible taxpayers and $2,400 for married couples filing joints returns.
IRS’s New People First Initiative
In response to the growing impact that COVID-19 is having on our daily lives and economy, the IRS released its People First Initiative. This Initiative was released on March 25, 2020, and includes many taxpayer friendly provisions. As explained by the Tax Commissioner, this Initiative was designed to “provide immediate relief to help people facing uncertainty over taxes.”
IRS Taxpayer Roadmap
The IRS Taxpayer Advocate’s office released the Taxpayer Roadmap (TAS_Roadmap) that provides a very visual illustration of the many stages of interactions with the IRS. This roadmap details the process of filing and processing a tax return. The IRS audit process and the Taxpayer’s ability to contest and review IRS audit examinations and changes.
New Forms for IRS Offer in Compromise Program
The IRS updated its Offer in Compromise booklet and released new forms for the Offer in Compromise program. The revised forms can be found at https://www.irs.gov/pub/irs-pdf-f656b.pdf.
In March 2019, the IRS updated the IRS Forms 433-A and B (OIC), the Collection Information Statements for Individuals and Businesses.