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ABA Section Calls For Research Credit Refund Claim Regs

The American Bar Association’s Section of Taxation is asking the Internal Revenue Service to issue regulations related to the filing of a research credit refund claim.

In a January 6 letter to the agency, the Section suggested that an October 15, 2021, memorandum providing specific instructions on filing the claim requires “the inclusion of such an extensive amount of documentation at the time of filing the claim,” which is “a significant departure from prior practice.”

The memorandum calls for the filer to identify all business components to which the research credit relates to for that year; identify all research activities performed, including who performed each activity and what information the research sought to discover; and provide total qualified wage, supply, and contract research expenses. Requirements outlined in the memorandum went into effect on January 10.

The ABA Section of Taxation asserts that the memorandum “imposes substantive requirements that could result in substantial compliance costs and would prevent certain filings. We believe the best way to achieve balance between the interests of [the agency] and taxpayers would be to issue proposed regulations establishing any new filing requirements.”

The Section said going the route to establish regulations would allow for “meaningful discussion” between taxpayers and the agency on what the requirements should be and also would require the IRS to consider the costs and benefits of any proposal as required by the Paperwork Reduction Act of 1995.

The Section also notes that the memorandum is non-authoritative guidance and the agency “has an interest in having taxpayers fully comply with any new procedural requirements for refund claims, but without authoritative guidance, there is a risk that it might not be followed consistently.”

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IRS Highlights Home Energy Credits for Taxpayers, IR-2024-137

IRS Issues FAQs on Disaster Relief Related to Retirement Plans, FS-2024-19; IR-2024-132

The IRS issued frequently asked questions (FAQs) related to distributions from retirement plans and IRS for individuals impacted by federally declared disasters. These FAQs cover the ongoing disaster relief for certain distributions […]

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IRS Issues FAQs on Disaster Relief Related to Retirement Plans, FS-2024-19; IR-2024-132

2025 Inflation Adjustments for Health Savings Accounts Released, Rev. Proc. 2024-25

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The eligibility for the Florida Tax Credit Scholarship Program is expanded for sales and use tax purposes. The scholarship program […]

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FL - Eligibility for tax credit scholarship program expanded

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Florida has issued the severance tax rates for the production of gas and sulfur effective July 1, 2024, through June […]

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No Further Funding Cuts For IRS In FY24

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IRS Criminal Investigation Releases COVID Fraud Conviction Statistics, IR-2024-83

The IRS released statistics that showed 1,644 tax and money-laundering cases related to COVID fraud, totaling $9 billion investigated by the Criminal Investigation (CI). CI is the law enforcement […]

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IRS Updates FAQ on Commercial Clean Vehicle Credits (FS-2024-14; IR-2024-111)

The IRS updated frequently asked questions (FAQ) on New, Previously Owned and Qualified Commercial Clean Vehicle Credits. These FAQs provide guidance on how the Inflation Reduction […]

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IRS Updates FAQ on Commercial Clean Vehicle Credits (FS-2024-14; IR-2024-111)

2024 Foreign Housing Expense Amounts Released, Notice 2024-31

KPMG TaxNewsFlash – United States March 20, 2024 The IRS today released Notice 2024-31 [PDF 156 KB] providing the adjustments to the limitation on housing expenses, under […]

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2024 Foreign Housing Expense Amounts Released, Notice 2024-31