Thursday, December 31, 2020

Treasury, IRS provide relief for those developing renewable energy projects offshore or on federal land

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Issue Number:    IR-2020-281

Inside This Issue

WASHINGTON –The Treasury Department and the Internal Revenue Service today issued guidance providing an extension of the safe harbor for taxpayers developing renewable energy projects offshore or on federal land.

Renewable energy projects constructed offshore or on federal land are ordinarily subject to significant delays that can result in project completion times of up to twice as long as other renewable energy projects. These delays threaten taxpayers' ability to satisfy requirements to claim the production tax credit and the investment tax credit.

To address this hurdle, the Treasury Department and the IRS have determined that it is necessary to extend the safe harbor period to up to 10 calendar years after the year in which construction of the project began.

By extending the safe harbor for these projects, Notice 2021-5 will provide flexibility for taxpayers constructing renewable energy projects offshore or on federal land to satisfy the beginning of construction requirements despite ordinary course delays that threaten their ability to claim tax credits.

 

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Tuesday, December 29, 2020

Treasury and IRS begin delivering second round of Economic Impact Payments to millions of Americans

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Issue Number:    IR-2020-280

Inside This Issue

Treasury and IRS begin delivering second round of Economic Impact Payments to millions of Americans

WASHINGTON – Today, the Internal Revenue Service and the Treasury Department will begin delivering a second round of Economic Impact Payments as part of the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 to millions of Americans who received the first round of payments earlier this year.

The initial direct deposit payments may begin arriving as early as tonight for some and will continue into next week. Paper checks will begin to be mailed tomorrow, Wednesday, Dec. 30.

The IRS emphasizes that there is no action required by eligible individuals to receive this second payment. Some Americans may see the direct deposit payments as pending or as provisional payments in their accounts before the official payment date of Jan. 4, 2021. The IRS reminds taxpayers that the payments are automatic, and they should not contact their financial institutions or the IRS with payment timing questions.

As with the first round of payments under the CARES Act, most recipients will receive these payments by direct deposit. For Social Security and other beneficiaries who received the first round of payments via Direct Express, they will receive this second payment the same way.

Anyone who received the first round of payments earlier this year but doesn't receive a payment via direct deposit will generally receive a check or, in some instances, a debit card. For those in this category, the payments will conclude in January. If additional legislation is enacted to provide for an additional amount, the Economic Impact Payments that have been issued will be topped up as quickly as possible.

Eligible individuals who did not receive an Economic Impact Payment this year – either the first or the second payment – will be able to claim it when they file their 2020 taxes in 2021. The IRS urges taxpayers who didn't receive a payment this year to review the eligibility criteria when they file their 2020 taxes; many people, including recent college graduates, may be eligible to claim it. People will see the Economic Impact Payments (EIP) referred to as the Recovery Rebate Credit (RRC) on Form 1040 or Form 1040-SR since the EIPs are an advance payment of the RRC.

"Throughout this challenging year, the IRS has worked around the clock to provide Economic Impact Payments and critical taxpayer services to the American people," said IRS Commissioner Chuck Rettig. "We are working swiftly to distribute this second round of payments as quickly as possible. This work continues throughout the holidays and into the new year as we prepare for the upcoming filing season. We urge everyone to visit IRS.gov in the coming days for the latest information on these payments and for important information and assistance with filing their 2021 taxes."

Authorized by the newly enacted COVID-relief legislation, the second round of payments, or "EIP 2," is generally $600 for singles and $1,200 for married couples filing a joint return. In addition, those with qualifying children will also receive $600 for each qualifying child. Dependents who are 17 and older are not eligible for the child payment.

Payments are automatic for eligible taxpayers

Payments are automatic for eligible taxpayers who filed a 2019 tax return, those who receive Social Security retirement, survivor or disability benefits (SSDI), Railroad Retirement benefits as well as Supplemental Security Income (SSI) and Veterans Affairs beneficiaries who didn't file a tax return. Payments are also automatic for anyone who successfully registered for the first payment online at IRS.gov using the agency's Non-Filers tool by Nov. 21, 2020 or who submitted a simplified tax return that has been processed by the IRS.

Who is eligible for the second Economic Impact Payment?

Generally, U.S. citizens and resident aliens who are not eligible to be claimed as a dependent on someone else's income tax return are eligible for this second payment. Eligible individuals will automatically receive an Economic Impact Payment of up to $600 for individuals or $1,200 for married couples and up to $600 for each qualifying child. Generally, if you have adjusted gross income for 2019 up to $75,000 for individuals and up to $150,000 for married couples filing joint returns and surviving spouses, you will receive the full amount of the second payment. For filers with income above those amounts, the payment amount is reduced.
How do I find out if the IRS is sending me a payment?

People can check the status of both their first and second payments by using the Get My Payment tool, available in English and Spanish only on IRS.gov. The tool is being updated with new information, and the IRS anticipates the tool will be available again in a few days for taxpayers.

How will the IRS know where to send my payment? What if I changed bank accounts?

The IRS will use the data already in our systems to send the new payments. Taxpayers with direct deposit information on file will receive the payment that way. For those without current direct deposit information on file, they will receive the payment as a check or debit card in the mail. For those eligible but who don't receive the payment for any reason, it can be claimed by filing a 2020 tax return in 2021. Remember, the Economic Impact Payments are an advance payment of what will be called the Recovery Rebate Credit on the 2020 Form 1040 or Form 1040-SR.
Will people receive a paper check or a debit card?

For those who don't receive a direct deposit by early January, they should watch their mail for either a paper check or a debit card. To speed delivery of the payments to reach as many people as soon as possible, the Bureau of the Fiscal Service, part of the Treasury Department, will be sending a limited number of payments out by debit card. Please note that the form of payment for the second mailed EIP may be different than for the first mailed EIP. Some people who received a paper check last time might receive a debit card this time, and some people who received a debit card last time may receive a paper check.

IRS and Treasury urge eligible people who don't receive a direct deposit to watch their mail carefully during this period for a check or an Economic Impact Payment card, which is sponsored by the Treasury Department's Bureau of the Fiscal Service and is issued by Treasury's financial agent, MetaBank®, N.A. The Economic Impact Payment Card will be sent in a white envelope that prominently displays the U.S. Department of the Treasury seal. It has the Visa name on the front of the Card and the issuing bank, MetaBank®, N.A. on the back of the card. Information included with the card will explain that this is your Economic Impact Payment. More information about these cards is available at EIPcard.com.

Are more people eligible now for a payment than before?

Under the earlier CARES Act, joint returns of couples where only one member of the couple had a Social Security number were generally ineligible for a payment – unless they were a member of the military. But this month's new law changes and expands that provision, and more people are now eligible. In this situation, these families will now be eligible to receive payments for the taxpayers and qualifying children of the family who have work-eligible SSNs. People in this group who don't receive an Economic Impact Payment can claim this when they file their 2020 taxes under the Recovery Rebate Credit.

Is any action needed by Social Security beneficiaries, railroad retirees and those receiving veterans' benefits who are not typically required to file a tax return?

Most Social Security retirement and disability beneficiaries, railroad retirees and those receiving veterans' benefits do not need take any action to receive a payment. Earlier this year, the IRS worked directly with the relevant federal agencies to obtain the information needed to send out the new payments the same way benefits for this group are normally paid. For eligible people in this group who didn't receive a payment for any reason, they can file a 2020 tax return.

I didn't file a tax return and didn't register with the IRS.gov non-filers tool. Am I eligible for a payment?

Yes, if you meet the eligibility requirement. While you won't receive an automatic payment now, you can still claim the equivalent Recovery Rebate Credit when you file your 2020 federal income tax return.
Will I receive anything for my tax records showing I received a second Economic Impact Payment?

Yes. People will receive an IRS notice, or letter, after they receive a payment telling them the amount of their payment. They should keep this for their tax records.

Where can I get more information?

For more information about Economic Impact Payments and the 2020 Recovery Rebate, key information will be posted on IRS.gov/eip. Later this week, you may check the status of your payment at IRS.gov/GetMyPayment. For other COVID-19-related tax relief, visit IRS.gov/Coronavirus.

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El Tesoro y el IRS comienzan a entregar la segunda ronda de pagos de impacto económico a millones de estadounidenses

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Consejos Tributarios del IRS 29 de diciembre de 2020

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Edición Número:    IR-2020-280SP

En Esta Edición


El Tesoro y el IRS comienzan a entregar la segunda ronda de pagos de impacto económico a millones de estadounidenses

WASHINGTON - El Servicio de Impuestos Internos y el Departamento del Tesoro hoy comenzarán a entregar una segunda ronda de Pagos de Impacto Económico como parte de la Ley de Asignaciones Suplementarias en Respuesta y Alivio al Coronavirus del 2021 a millones de estadounidenses que previamente recibieron la primera ronda de pagos a principios de este año.

Los pagos iniciales del depósito directo pueden comenzar a llegar hoy para algunos y continuarán hasta la próxima semana. Los cheques en papel comenzarán a enviarse por correo mañana, miércoles 30 de diciembre.

El IRS enfatizó que las personas elegibles no tienen que hacer absolutamente nada para recibir este segundo pago. Algunos estadounidenses podrán ver los pagos de depósito directo como pendientes o como pagos provisionales en sus cuentas antes de la fecha de pago oficial del 4 de enero del 2021. El IRS recuerda a los contribuyentes que los pagos son automáticos y que no deben comunicarse con sus instituciones financieras o el IRS con preguntas sobre la fecha de pago.

Así como la primera ronda de pagos bajo la Ley CARES, la mayoría de los beneficiarios recibirán estos pagos por depósito directo. Para los beneficiarios de Seguro Social u otros quienes recibieron la primera ronda de pagos mediante la tarjeta de débito Direct Express, recibirán este segundo pago de la misma manera.

Cualquier persona que recibió en la primera ronda de pagos a principios del año, pero no recibe un pago vía depósito directo recibirá un cheque en papel, o en algunas instancias, una tarjeta de débito. Para las personas en esta categoría, los pagos comenzarán a enviarse por correo la próxima semana y estos envíos terminarán en enero. Si se promulga una nueva legislación para proveer un monto adicional al Pago de impacto económico, estos se completarán lo antes posible.

Las personas elegibles que no recibieron ni el primer ni el segundo Pago de impacto económico este año – pueden reclamarlo cuando presenten su declaración de impuestos del 2020 en el 2021. El IRS pide a los contribuyentes que no recibieron un pago este año que revisen los requisitos de elegibilidad cuando declaren sus impuestos del 2020; muchas personas, incluidos los universitarios recién graduados, pueden ser elegibles para recibirlo. Las personas verán que los Pagos de impacto económico (EIP) se refieren como el Crédito de recuperación de reembolso (RRC) en su Formulario 1040 o Formulario 1040-SR ya que los EIP son un pago por adelantado de RRC.

"Durante este año de retos, el IRS ha trabajado día y noche para proveer los Pagos de impacto económico y servicios importantes a los contribuyentes estadounidenses", dijo Chuck Rettig Comisionado del IRS. "Estamos trabajando rápidamente para distribuir el segundo pago lo antes posible. Nuestro trabajo continuará durante las festividades del fin de año y seguirá al entrar al año nuevo ya que nos preparamos para la próxima temporada de declaración de impuestos. Le pedimos a todos los contribuyentes que visiten IRS.gov durante los próximos días para ver las últimas actualizaciones acerca de estos pagos y, a la vez, ver importante contenido y asistencia con sus declaraciones de impuestos del 2021".

Autorizado por la reciente legislación de la ayuda COVID, la segunda ronda de pagos, o "EIP 2," es generalmente de $600 para individuos y $1,200 para parejas casadas que presentan declaraciones de impuestos conjuntamente. Además, aquellos con hijos calificados recibirán $600. Los dependientes mayores de 17 años no son elegibles para este pago.

Los pagos son automáticos para los contribuyentes elegibles

Los pagos son automáticos para los contribuyentes elegibles que presentaron una declaración de impuestos del 2019, aquellos que recibieron beneficios de jubilación del Seguro Social, sobrevivientes o beneficios por incapacidad (SSDI, por sus siglas en inglés), de jubilación ferroviaria, así como Ingreso de Seguro Suplemental (SSI, por sus siglas en inglés) y los beneficiarios de Asuntos de Veteranos que no presentaron una declaración de impuestos. Los pagos también son automáticos para toda persona que se inscribió exitosamente para recibir el primer pago en línea en IRS.gov, usando la herramienta Non-Filers antes del 21 de noviembre del 2020 o quienes presentaron una declaración simplificada y fue procesada por el IRS.

¿Quién es elegible para el segundo Pago de impacto económico?

Generalmente, los ciudadanos de EE. UU. y residentes extranjeros, que no son reclamados como dependiente en una declaración de impuestos de otra persona, son elegibles para este segundo pago. Los individuos elegibles automáticamente recibirán un Pago de impacto económico de hasta $600 para individuos o $1,200 para las parejas casadas y hasta $600 para cada hijo calificado. Por lo general, si declaró ingreso bruto ajustado en el 2019 de hasta $75,000 para individuos y hasta $150,000 para las parejas casadas que declaran impuestos en conjunto y cónyuges sobrevivientes, recibirá el monto completo del segundo pago. Para las personas que declaran impuestos por encima de estos ingresos, la cantidad del pago será reducida.

¿Cómo puedo informarme si el IRS me enviará un pago?

Las personas pueden verificar los estados del primer y segundo pago usando la herramienta Obtener mi pago en IRS.gov. La herramienta se está actualizando con nueva información, y el IRS anticipa que la herramienta estará disponible nuevamente para los contribuyentes en unos días.

¿Cómo sabrá el IRS a dónde enviar mi pago? ¿Qué pasa si cambié de cuenta bancaria?

El IRS usará los datos que ya están en nuestra base de datos para enviar los nuevos pagos. Los contribuyentes con información de depósito directo registrada recibirán el pago de esa manera. Para aquellos que no tengan la información actual sobre el depósito directo en la base de datos, recibirán el pago con cheque en papel o tarjeta de débito por correo. Para aquellos elegibles pero que no reciben el pago por algún motivo, cuando presenten su declaración de impuestos del 2020 en el 2021 pueden solicitar el pago. Recuerde, los Pagos de impacto económico son un pago por adelantado de lo que se llamará el Crédito de recuperación de reembolso en el 2020 Formulario 1040 o Formulario 1040-SR.

¿Recibirán las personas un cheque en papel o una tarjeta de débito?

Para aquellos que no reciben un depósito directo a principios de enero, deben buscar en su buzón un cheque o una tarjeta de débito. Para acelerar la entrega de los pagos y alcanzar a la mayor cantidad de personas lo antes posible, el Buró de Servicio Fiscal, que es parte del Departamento del Tesoro, enviará un número limitado de pagos con tarjeta de débito. Tenga en cuenta que el segundo envío del EIP puede ser diferente al primer EIP enviado por correo. Algunas personas que recibieron un cheque en papel la última vez pueden recibir una tarjeta de débito en esta ocasión, y algunas personas que recibieron una tarjeta de débito la última vez pueden recibir un cheque en papel.

El IRS y el Tesoro instan a las personas elegibles que no reciben un depósito directo a vigilar cuidadosamente su correo durante este período para obtener un cheque o una tarjeta de pago de impacto económico, que está patrocinado por el Buró de Servicio Fiscal del Departamento del Tesoro y es emitido por el agente del departamento financiero del Tesoro, MetaBank®, NA La tarjeta del Pago de impacto económico se enviará en un sobre blanco que muestra el sello del Departamento del Tesoro de los EE. UU. Al frente de la tarjeta aparece el nombre de Visa y al reverso dice que la tarjeta es emitida por el banco, MetaBank®, N.A. La información incluida con la tarjeta le explica que este es su Pago de impacto económico. Más información sobre estas tarjetas está disponible en EIPcard.com.

¿Existen más personas elegibles ahora para un pago que antes?

Según la Ley CARES anterior, las declaraciones conjuntas de parejas en las que sólo un miembro de la pareja tenía un número de seguro social generalmente no eran elegibles para un pago, a menos que fueran miembros de las fuerzas armadas. Pero la nueva ley de este mes cambia y amplía esa disposición, y ahora más personas son elegibles. En esta situación, estas familias ahora serán elegibles para recibir pagos para los contribuyentes y los hijos calificados de la familia que tienen un número de seguro social (SSN, por sus siglas en inglés) elegibles para trabajar. Las personas de este grupo que no reciben un Pago de impacto económico pueden reclamarlo cuando presenten sus declaraciones de impuestos del 2020 bajo el Crédito de recuperación de reembolso.

¿Es necesaria alguna acción por parte de los beneficiarios del Seguro Social, los jubilados ferroviarios y los que reciben beneficios de veteranos que normalmente no están obligados a presentar una declaración de impuestos?

La mayoría de los beneficiarios de jubilación y discapacidad del Seguro Social, jubilados ferroviarios y aquellos que reciben beneficios de veteranos no necesitan hacer absolutamente nada para recibir un pago. A principios de este año, el IRS trabajó directamente con las agencias federales relevantes para obtener la información necesaria para enviar los nuevos pagos de la misma manera que normalmente se pagan los beneficios para este grupo. Para las personas elegibles de este grupo que no recibieron un pago por algún motivo, pueden presentar una declaración de impuestos del 2020.

No presenté una declaración de impuestos y no me registré con la herramienta Non-Filer en IRS.gov. ¿Soy elegible para un pago?

Sí, si usted cumple con los requisitos de elegibilidad. Si bien no recibirá un pago automático ahora, aún puede reclamar el Crédito de recuperación de reembolso equivalente cuando presente su declaración de impuestos federales del 2020.

¿Recibiré un comprobante para mis registros tributarios que demuestre que recibí un segundo pago de impacto económico?

Si. Las personas recibirán un aviso del IRS, o una carta, después de recibir un pago informándoles el monto de su pago. Deben guardar este documento con sus registros tributarios.

¿Dónde puedo obtener más información?

Para obtener más información sobre los pagos de impacto económico y el reembolso de recuperación del 2020, la información clave se publicará en IRS.gov/es/eip. Durante la semana, podrán revisar el estado de su pago en IRS.gov/GetMyPayment. Para otros alivios tributarios relacionados con COVID-19, visite IRS.gov/es/Coronavirus.

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Wednesday, December 23, 2020

Required Minimum Distributions waived for 2020, year-end reminders

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RMDs Waived for 2020

The CARES Act waives required minimum distributions (RMDs) during 2020 for IRAs and defined contribution retirement plans. RMDs are also waived for beneficiaries with inherited IRAs and accounts inherited in a retirement plan. You're not required to have been affected by the coronavirus to waive your RMD for 2020.

Distributions of an amount that would have been an RMD in 2020 can generally be rolled over to another workplace retirement plan or IRA within 60 days of the distribution. RMDs rolled over by August 31, 2020, have special relief.

RMD rolled over by August 31, 2020: Notice 2020-51 [PDF] provides that if a distribution from an IRA of an amount that would have been an RMD in 2020 was made between January 1, 2020, and July 2, 2020, then the distribution can be rolled over by August 31, 2020. If a 2020 RMD was distributed after July 2, 2020, then the distribution must be rolled over within 60 days of the distribution. A 2020 RMD that's part of a series of substantially equal periodic payments does not prevent it from being eligible for rollover.

Additionally, if a 2020 RMD was distributed before August 31, 2020, but was repaid to the distributing IRA by August 31, 2020:

  • The repayment is not subject to the one rollover per 12-month period limitation.
  • An RMD from an inherited IRA can be repaid to the distributing IRA.

Inherited IRAs: Distributions from inherited IRAs are not required in 2020. For deaths prior to 2020, beneficiaries are required to take distributions using the 5-year rule or yearly distributions over their life expectancy.

The 5-year rule requires the inherited IRA to be distributed within 5 years following the year of the account holder's death. 2020 does not count toward the 5 years. You would essentially have six years, instead of five, to distribute the inherited IRA if the account holder died before 2020.

If you were taking distributions using the lifetime distribution option available for deaths prior to 2020, you're not required to take a distribution in 2020. For an account holder who died in 2019, you would normally be required to begin taking distributions from the inherited IRA by the end of the following year, 2020, to take advantage of the lifetime distribution option. Since 2020 does not count, you have until the end of 2021 to begin taking distributions over your lifetime.

Tax treatment of 2020 RMDs that are not rolled over: RMDs in 2020 that are not rolled over or repaid may be eligible to be treated as coronavirus-related distributions if you're a qualified individual. A 2020 RMD that otherwise qualifies as a coronavirus-related distribution may be repaid over a 3-year period or have the taxes due on the distribution spread over three years. 

Special note for inherited IRAs: If a withdrawal from an inherited IRA qualifies as a coronavirus-related distribution, income from the withdrawal may be spread over three years for income inclusion. However, the withdrawal may not be repaid to the inherited IRA. 

Substantially equal periodic payments are not waived

If you're using substantially equal periodic payments to meet one of the exceptions to the 10% additional tax on distributions prior to age 59 ½, you're still required to take your periodic payment in 2020. If you do not take your periodic payment in 2020, you lose the exception and those withdrawals taken in prior years will become subject to the 10% additional tax.

Resources

Coronavirus relief for retirement plans and IRAs

Coronavirus-related Q&As for retirement plans and IRAs

Notice 2020-50 [PDF]

Notice 2020-51 [PDF]

 


Find answers to many retirement plan questions on IRS.gov at Retirement Plans and Retirement Plan Forms and Publications.

If you need help with an account-specific question, basic information about retirement plan forms or the status of pending applications, call our Customer Account Services at 877-829-5500.

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Tuesday, December 22, 2020

IRS issues standard mileage rates for 2021

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Issue Number:    IR-2020-279

Inside This Issue

IRS issues standard mileage rates for 2021

WASHINGTON — The Internal Revenue Service today issued the 2021 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on Jan. 1, 2021, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

   • 56 cents per mile driven for business use, down 1.5 cents from the rate for 2020,
  
• 16 cents per mile driven for medical or moving purposes for qualified active duty members of the Armed Forces, down 1 cent from the rate for 2020, and
   • 14 cents per mile driven in service of charitable organizations, the rate is set by statute and remains unchanged from 2020.

The standard mileage rate for business use is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.

It is important to note that under the Tax Cuts and Jobs Act, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. Taxpayers also cannot claim a deduction for moving expenses, unless they are members of the Armed Forces on active duty moving under orders to a permanent change of station. For more details see Moving Expenses for Members of the Armed Forces.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Taxpayers can use the standard mileage rate but must opt to use it in the first year the car is available for business use. Then, in later years, they can choose either the standard mileage rate or actual expenses. Leased vehicles must use the standard mileage rate method for the entire lease period (including renewals) if the standard mileage rate is chosen.

Notice 2021-02 contains the optional 2021 standard mileage rates, as well as the maximum automobile cost used to calculate the allowance under a fixed and variable rate (FAVR) plan. In addition, the notice provides the maximum fair market value of employer-provided automobiles first made available to employees for personal use in calendar year 2021 for which employers may use the fleet-average valuation rule in or the vehicle cents-per-mile valuation rule. 

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