Our tax department thought this was timely information and we wanted to share it with our clients. As always, if you have questions please reach out to your Pugh CPAs advisor.
Substantial Omission of Income Increases the Statute of Limitations Period: In a Program Manager Technical Advice Memorandum (PMTA), the IRS Office of Chief Counsel said that the IRS can extend the statute of limitations period to six years if it discovers a substantial omission of income, as defined by IRC Sec. 6501(e)(1) (generally one in which more than 25% of the gross income is omitted), when a taxpayer files an amended return after the standard three-year limitations period. PMTA 2016-04.
New Tool to Estimate Employer Shared Responsibility Provision (ESRP): The Taxpayer Advocate Service announced a new ESRP Estimator designed to help a business determine (1) its number of full-time employees, including full-time equivalent employees (FTEs), (2) whether it might be considered an applicable large employer (ALE), and (3) if it is an ALE, the maximum amount of the potential liability for the employer shared responsibility payment that could apply if the employer fails to offer coverage to the required number of full-time employees and their dependents. Tax professionals can use the tool to help educate business clients about potential employer shared responsibility requirements. The ESRP Estimator is available at www.taxpayeradvocate.irs.gov/estimator/esrp.
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