Daily Tax Update - January 5, 2012: IRS Extends Filing Deadline To April 17th

IRS EXTENDS FILING DEADLINE TO APRIL 17TH:  The IRS has announced that taxpayers have until April 17 to file their tax returns.  The IRS stated, "Taxpayers will have until Tuesday, April 17 to file their 2011 tax returns and pay any tax due because April 15 falls on a Sunday, and Emancipation Day, a holiday observed in the District of Columbia, falls this year on Monday, April 16.  According to federal law, District of Columbia holidays impact tax deadlines in the same way that federal holidays do; therefore, all taxpayers will have two extra days to file this year.  Taxpayers requesting an extension will have until October 15 to file their 2011 tax returns."

  • The IRS has released a fact sheet (FS-2012-01) highlighting several 2011 tax law changes.

DOZENS OF TAX BREAKS EXPIRED DECEMBER 31ST:  Over fifty tax provisions ("extenders"), including the AMT "patch" and the research and development credit, expired on December 31 because Congress failed to act before it adjourned for the year.  However, Congress is expected to retroactively renew some or all of the extenders after it returns. 

  • In mid-December, Finance Chairman Max Baucus commented on the extenders.  Baucus said, "[W]e’re going to keep fighting to extend other expiring tax cuts for families and small businesses to put more money back in their pockets and provide certainty for our economy when Congress reconvenes.  As we work together on comprehensive tax reform for the long-term, reaching a permanent agreement on expiring tax cuts right away must be our top priority."
  • For a complete list of the expired tax breaks, see Joint Committee on Taxation, List of Expiring Federal Tax Provisions 2010-2020.
  • Some of the provisions that expired December 31 include:
    • Personal tax credits allowed against regular tax and AMT (sec. 26(a)(2))
    • Increased AMT exemption amount (sec. 55(d)(1))
    • Premiums for mortgage insurance deductible as interest that is qualified residence interest (sec. 163(h)(3))
    • Deduction for State and local general sales taxes (sec. 164(b)(5))
    • 15-year straight-line cost recovery for qualified leasehold improvements, qualified restaurant buildings and improvements, and qualified retail improvements (secs. 168(e)(3)(E)(iv), (v), (ix), 168(e)(7)(A)(i) and (e)(8))
    • Tax credit for research and experimentation expenses (sec. 41(h)(1)(B))
    • Additional first-year depreciation for 100 percent of basis of qualified property (sec.168(k)(5))
    • Grants for specified energy property in lieu of tax credits (sec. 48(d) and sec. 1603 of Pub. L. No. 111-5)
    • Work opportunity tax credit (sec. 51(c)(4))
    • Increase in expensing to $500,000/$2,000,000 and expansion of definition of section 179 property (secs.
    • 179(b)(1) and (2) and 179(f))
    • Special expensing rules for certain film and television productions (sec. 181(f))
    • Exceptions under subpart F for active financing income (secs. 953(e)(10) and 954(h)(9))
    • Look-through treatment of payments between related controlled foreign corporations under the foreign personal holding company rules (sec. 954(c)(6))
    • Special rules for qualified small business stock (sec. 1202(a)(4))
    • Reduction in S corporation recognition period for built-in gains tax (sec. 1374(d)(7))

MISCELLANEOUS GUIDANCE RELEASED:

Revenue Ruling 2012-05 provides tables of covered compensation under § 401(l)(5)(E) of the Internal Revenue Code and the Income Tax Regulations, thereunder, for the 2012 plan year.

Notice 2012-08 provides a proposed revenue procedure that would update Rev. Proc. 2003-61, 2003-2 C.B. 296, which provides guidance regarding equitable relief from income tax liability under section 66(c) and section 6015(f) of the Internal Revenue Code.

Notice 2012-09 restates and amends the interim guidance on informational reporting to employees of the cost of their employer-sponsored group health plan coverage initially provided in Notice 2011-28, 2011-16 I.R.B. 656, required under as part of the Affordable Care Act to provide useful and comparable consumer information to employees on the cost of their health care coverage.

INTERNAL REVENUE SERVICE - CIRCULAR 230 DISCLOSURE:
As provided for in Treasury regulations, advice (if any) relating to federal taxes that is contained in this communication (including attachments) is not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any plan or arrangement addressed herein.

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