Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of August 19, 2024 – August 23, 2024.

August 19, 2024: The IRS released Internal Revenue Bulletin 2024-34, which includes the following:

• Treasury Decision 10005, which provides the criteria for single-employer defined benefit plan sponsors to obtain approval to use plan-specific mortality tables when calculating present value for minimum funding. Effective July 31, 2024, these changes will apply to plan years beginning on or after January 1, 2025.
• Notice 2024-61, which provides the inflation adjustment factor and phase-out amount for the enhanced oil recovery credit under § 38 of the Internal Revenue Code (Code) for calendar years 1991 through 2024.
• Announcement 2024-31, which revokes the Code § 501(c)(3) determination for specified organizations and stipulates that contributions made to said organizations by individual donors are no longer deductible under Code § 170(b)(1)(A).

August 19, 2024: The IRS reminded taxpayers that summer day camp expenses may qualify for the Child and Dependent Care tax credit, which can help offset costs for working parents with children under 13. The credit may cover up to 35% of qualifying expenses, with a maximum eligible expense of $3,000 for one child and $6,000 for two or more.

August 19, 2024: The IRS released Notice 2024-63, which allows employers to match contributions to Code § 401(k) plans and similar retirement plans based on employees’ student loan payments. This guidance, effective for plan years beginning after December 31, 2023, includes eligibility criteria, employee certification requirements, and special nondiscrimination testing relief.

August 19, 2024: The IRS reminded taxpayers who requested an extension to file their federal taxes that free filing options, such as IRS Free File and MilTax (for eligible military members), are still available for filing electronically and claiming tax credits.

August 20, 2024: The IRS advised taxpayers who opted for paid tax preparers to help file their tax returns to verify the preparer’s credentials, check their history with the Better Business Bureau, and ensure they offer IRS e-file services.

August 20, 2024: The IRS highlighted the “Security Six,” a set of essential steps tax professionals can take to protect their offices, computers, and client data from cyber threats. These steps include using anti-virus software, firewalls, multifactor authentication, backup software or services, encrypted drives, and virtual private networks.

August 21, 2024: The IRS reminded school teachers that they can deduct up to $300 of unreimbursed classroom expenses for the 2024 tax year. This deduction applies to a variety of classroom items, including supplies, books, and equipment, and is available even if teachers take the standard deduction.

August 21, 2024: The IRS released Revenue Ruling 2024-18, which announces that interest rates for tax overpayments and underpayments under Code § 6621 will remain unchanged for the fourth quarter of 2024.

August 21, 2024: The IRS reminded taxpayers who requested an extension to file their federal tax returns that as soon as they have all the necessary documents, they should use IRS Free File if eligible and consider paying any owed taxes to avoid penalties and interest.

August 23, 2024: The IRS extended the deadline to file federal individual and business tax returns and make tax payments for certain individuals and businesses in Puerto Rico that were affected by Tropical Storm Ernesto. The new deadline is February 3, 2025. The extended deadline is available to taxpayers in any area designated by the Federal Emergency Management Agency (FEMA), including individuals and households that reside or have a business in any of Puerto Rico’s 78 municipalities.

August 23, 2024: The IRS extended the deadline to file federal individual and business tax returns and make tax payments for certain individuals and businesses in South Dakota that were affected by severe weather that started June 16, 2024. The new deadline is February 3, 2025. The extended deadline is available to taxpayers in any area designated by FEMA, including individuals and households that reside or have a business in Aurora, Bennett, Bon Homme, Brule, Buffalo, Charles Mix, Clay, Davison, Douglas, Gregory, Hand, Hanson, Hutchinson, Jackson, Lake, Lincoln, McCook, Miner, Minnehaha, Moody, Sanborn, Tripp, Turner, Union, and Yankton counties.

August 23, 2024: The IRS announced it has made progress in enabling all-digital interactions, expanding in-person services, and using advanced data science techniques to detect tax evasion. These efforts aim to improve taxpayer service and address complex financial maneuvers used to evade taxes.

August 23, 2024: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandums and Chief Counsel Advice).