January:
Tax Law Changes Delay e-file for a Small Number of 2005 Forms. To learn more click on: www.irs.gov

IRS Settlement Deadline Approaches. To learn more click on: www.irs.gov

IRS Revises Schedule K-1 for Trusts. To learn more click on: www.irs.gov


February
IRS Releases New Guidance and Results of Political Intervention Examinations. To learn more click on: www.irs.gov

IRS Clarifies Information Reporting of Tobacco Payments. To learn more click on: www.irs.gov

Treasury and IRS Provide Guidance for energy Credits for Homeowners. To learn more click on: www.irs.gov

IRS Has $2 Billion for People Who Have Not Filed a 2002 Tax Return. To learn more click on: www.irs.gov


March:
IRS awards approximately $7.5 million to tax Clinics Aiding Low Income Taxpayers. To learn more click on: www.irs.gov

IRS Provides Transition Relief to Partnerships and Pass-Thru Entities under new code section. To learn more click on: www.irs.gov
IRS Clarifies AMT Deduction for Home Mortgage Interest. To learn more click on: www.irs.gov


April:
The Supreme Court gave bankrupt Americans another layer of financial protection Monday, ruling that creditors cannot seize their Individual Retirement Accounts. To learn more click on: www.irs.gov
Toyota and Lexus vehicles certified for new energy tax credit. To learn more click on: www.irs.gov


May:
IRS accepting applications for low income taxpayer clinic matching grants. To learn more click on: www.irs.gov


June:
Several 2007 Ford and Mercury Vehicles Certified for the New Energy Tax Credit. To learn more click on: www.irs.gov

IRS Issues Guidance to Hurricane Victims Claiming Casualty Losses; Safe Harbor Methods Available for Individuals. To learn more click on: www.irs.gov

IRS Office of Taxpayer Burden Reduction Partners with Public to make complying with tax laws easier. To learn more click on: www.irs.gov


July:
Employer Cash Incentives for Hybrids Are Taxable. To learn more click on: www.irs.gov
WASHINGTON — To encourage their employees to purchase environmentally-friendly hybrid cars, several companies reportedly are offering “rebates” or cash incentives to their employees in select areas to offset the purchase price of these vehicles. Just like other forms of compensation, these cash incentives are taxable compensation.

Employers should include the cash incentive amounts in employees’ compensation reported on year-end Form W-2 earnings statements. The cash incentives also are subject to income tax withholding and employment tax. The tax code provides for an exclusion from income for employee discounts only if the employer produces the product and certain other requirements are met.

The tax code already includes incentives for the purchase of hybrid cars. The Alternative Motor Vehicle Credit for hybrid vehicles applies to vehicles purchased on or after Jan. 1, 2006, and it may be as much as $3,400 for those who purchase the most fuel-efficient vehicles. For more information, go to IRS.gov.

Related Item:
Hybrid Cars and Alternative Motor Vehicles. To learn more click on: www.irs.gov
New Law Revamps IRS Offer in Compromise Program; 20% Up-Front Payment Required in Many Cases. To learn more click on: www.irs.gov

WASHINGTON — under a new federal law, taxpayers submitting new offers in compromise must make a 20 percent nonrefundable, up-front payment in many cases, the Internal Revenue Service announced today.
The recently-enacted Tax Increase Prevention and Reconciliation Act of 2005 (TIPRA) made major changes to the offer in compromise (OIC) program, tightening the rules for lump-sum offers and periodic-payment offers. These changes become effective for all offers received by the IRS starting July 16, 2006.
Several GM Vehicles Certified for Alternative Vehicle Tax Credit. To learn more click on: www.irs.gov
WASHINGTON — The Internal Revenue Service has acknowledged the certification by General Motors Corporation that several of its 2006 and 2007 vehicles qualify for the Alternative Motor Vehicle Credit created by the Energy Policy Act of 2005. The tax credit for hybrid vehicles applies to new vehicles placed in service on or after Jan. 1, 2006.

The hybrid vehicle certifications recently acknowledged by the IRS and their credit amounts are:
• GMC Sierra (4WD) hybrid pickup truck Model Year 2006 $650.00
• GMC Sierra (4WD) hybrid pickup truck Model Year 2007 $650.00
• Chevrolet Silverado (4WD) hybrid pickup truck - Model Year 2006 $650.00
• Chevrolet Silverado (4WD) hybrid pickup truck - Model Year 2007 $650.00
• GMC Sierra (2WD) hybrid pickup truck Model Year 2006 $250.00
• GMC Sierra (2WD) hybrid pickup truck Model Year 2007 $250.00
• Chevrolet Silverado (2WD) hybrid pickup truck - Model Year 2006 $250.00
• Chevrolet Silverado (2WD) hybrid pick up truck - Model Year 2007 $250.00

Starting in 2006, this tax credit replaces the tax deduction of $2,000, which was previously allowed for taxpayers who purchased a new hybrid vehicle before Dec. 31, 2005, for the clean-burning fuel deduction. The tax credit requires a different certification. Many currently available hybrid vehicles may qualify for this new tax credit.

Honda Vehicles Certified to Operate on Compressed Natural Gas. To learn more click on: www.irs.gov

WASHINGTON — The Internal Revenue Service has acknowledged the certification by American Honda Motor Company, Inc., that two of its vehicles powered by compressed natural gas (CNG) meet the requirements of the Alterative Motor Vehicle Credit enacted by the Energy Policy Act of 2005.
The certification meets the requirements of IRS Notice 2006-54 qualifying the vehicles as Qualified Alternative Fuel Motor Vehicles (QAFMV). Honda Civic GX Model Years 2005 and 2006 are only capable of operating on compressed natural gas.
The vehicle certifications recently acknowledged by the IRS and their credit amounts are:
• Honda Civic GX Model Year 2005 $4,000.00
• Honda Civic GX Model Year 2006 $4,000.00
GM’s 2007 Saturn Vue Green Line Certified for the New Energy Tax Credit. To learn more click on: www.irs.gov

WASHINGTON — The Internal Revenue Service has acknowledged the certification by General Motors Corp. that its 2007 Saturn Vue Green Line vehicle qualifies for the Alternative Motor Vehicle Credit created by the Energy Policy Act of 2005. This certification is under IRS Notice 2006-9. The tax credit for hybrid vehicles applies to new vehicles placed in service on or after Jan. 1, 2006.
The credit amount for the hybrid vehicle certification of the Saturn Vue Green Line Model Year 2007 is $650.
Starting in 2006, this tax credit replaces the tax deduction of $2,000, which was previously allowed for taxpayers who purchased a new hybrid vehicle before Dec. 31, 2005, for the clean-burning fuel deduction. The tax credit requires a different certification. Many currently available hybrid vehicles may qualify for this new tax credit.
E-FILE available through October 16. To learn more click on: www.irs.gov


August:
IRS announces additional postponement of filing and payment deadline for businesses in the Gulf Coast. To learn more click on: www.irs.gov

Proposed Regulations Issued for Capitalization of Tangible Assets. To learn more click on: www.irs.gov
Purchasers of Ford and Mercury Hybrids Still Qualify for Tax Credit. To learn more click on: www.irs.gov
Purchasers of GM Hybrids Still Qualify for Tax Credit. To learn more click on: www.irs.gov

September:
IRS Announces User Fee for U.S. Residency Certification. To learn more click on: www.irs.gov
More than 12,500 large Corporations E-filed 2005 tax returns in first year of new requirement. To learn more click on: www.irs.gov