Tax News

CCH (cch.taxgroup.com) reports:

  Employee benefits and tax accounting issues stand out in the IRS's 2009-2010 Priority Guidance Plan, which the Service released on November 24. The guidance plan describes more than 300 areas in which the Service intends to issue final regulations, proposed regulations and other guidance. Some of the projects have already been completed.

Employee Benefits

  In the employee benefits and related areas, the IRS promised to deliver long-awaited final regulations on cafeteria plans under Code Sec. 125. The Service also plans to issue a notice on a sample cafeteria plan under Code Sec. 125.

  Many of the employee benefits and related guidance projects spring from the Pension Protection Act of 2006 (P.L. 109-280). The IRS intends to issue final regulations on diversification requirements under Code Sec. 401(a)(35), on hybrid plans under Code Secs. 411(a)(13) and 411(b)(5), and final regulations on the determination of the minimum required contributions under
Code Sec. 430.

  Taxpayers can expect more Code Sec. 409A guidance, including guidance on a Code Sec. 409A correction program, the Service reported. The IRS also intends to publish final regulations on income inclusion under Code Sec. 409A.

Tax Accounting

  Tax accounting issues also make up a large part of the priority guidance plan. Among other projects, the IRS intends to issue final regulations under Code Sec. 263(a) regarding the deduction and capitalization of expenditures for tangible assets, proposed regulations under Code Sec. 263(a) regarding the treatment of capitalized transaction costs, and additional guidance under Code Sec. 469 regarding home construction contracts.

International Issues

  The priority guidance plan reflects the IRS's renewed emphasis on international tax issues. The Service intends to issue guidance under Code Sec. 1441 on qualified intermediaries and guidance on cross-border information and filing issues. As in past years, taxpayers can expect guidance on the foreign tax credit.

Partnerships and S Corporations

  In the pass-through area, the IRS intends to issue final regulations on S corporation losses/reduction in tax attributes under Code Sec. 108(b) for discharge of indebtedness income that is excluded from gross income and guidance under Code Sec. 1367 regarding S corporations and back-to-back loans. Taxpayers can also expect final regulations under Code Sec. 108(e)(8) regarding debt satisfied by a partnership interest.

  By George L. Yaksick, Jr., CCH News Staff

Treasury Office of Tax Policy and Internal Revenue Service 2009-2010 Priority Guidance Plan, 2009FED ¶46,543

Other References:

 
Code Sec. 7804

  CCH Reference - 2009FED ¶43,266.49

  Tax Research Consultant

  CCH Reference - TRC IRS: 12,350