End of July IRS Updates

Refund Myths Addressed

The IRS is debunking some common refund myths circulating among taxpayers. 

  • The IRS wants taxpayers to know that calling them or a tax professional cannot expedite your refund, nor do they have access to any special information regarding your refund date. 
  • Ordering a tax transcript doesn’t provide that either.
  • A smaller refund doesn’t mean the IRS has a problem: outstanding child support, federal or state taxes, student loans or other debts can cause your refund to be less than expected.

The best way to find out the status of your refund is to use the Where’s My Refund tool, or the IRS2Go app. 

Retirement Distributions Waived For 2020

Seniors and retirees do not have to take their usual required minimum distribution (RMD) from their IRA or workplace retirement accounts in 2020, thanks to coronavirus relief measures passed this year. The waiver includes RMDs for individuals who turned 70 ½ in 2019 and took their first RMD in 2020. Those who have already taken their RMD have the option of returning it to their qualified plan. These provisions apply to most retirement plans, including traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, and others. 

Annual “Dirty Dozen” Unveiled

The IRS has published its list of the 12 most common tax scams perpetrated by criminals this year. Taxpayers should be aware and vigilant in regards to spotting and avoiding these scams, especially the ones on the rise in the wake of the pandemic and economic impact payments (EIPs). Scams on the list include phishing emails, fake charities, threatening phone calls, EIP or refund theft, organizations “overselling” Offer In Compromise assistance, payroll scams, ransomware, and more. 

Foreign-Taxed Income Guidelines

The IRS has published final regulations on how income from foreign corporations subject to a high rate of foreign tax shall be treated. The final regulations allow taxpayers to exclude certain high-taxed income of a controlled foreign corporation from their Global Intangible Low Taxed Income (GILTI) computation on an elective basis. The IRS also released proposed regulations regarding that high-tax exception with the GILTI exclusion, and welcomes public comments on the subject.