Tax News & Views Ice Cream Float Roundup

Jenny McGarry
June 20, 2024
Vanilla ice cream

Key Takeaways

  • Inflation Reduction Act
  • Research Credit Update
  • TCJA
  • Blogs and Bits
  • National Ice Cream Soda Day

Inflation Reduction Act

Treasury Finalizes Labor Rules For Bonus Energy Tax Credits - Kat Lucero, Law360($):

The U.S. Treasury Department released final labor rules Tuesday for clean energy projects seeking to significantly boost the value of their tax credits, emphasizing due diligence by developers and announcing that more IRS resources will go toward enforcement of the rules.

The 354 pages of rules enact strict recordkeeping provisions for clean energy projects wanting to claim the bonus tax credits for meeting prevailing wage and apprenticeship requirements, despite many requests by trade groups and other stakeholders to relax the documentation burden detailed in August's proposed regulations.


Research Credit Update

IRS Nixes Two Requirements for Research Credit Refund Claims - Erin Slowey, Bloomberg Tax($). "The IRS is waiving two requirements that taxpayers submit certain information with their research credit refund claim, the agency said Tuesday." 



Corporate Rate Revenue To Decrease After 2025, CBO Says - Asha Glover, Law360($):

Corporate income tax receipts will steadily decrease after 2025 in relation to gross domestic product due to expiration of many of the 2017 tax law's provisions, the Congressional Budget Office said in a report released Tuesday. 

The federal government will receive a projected $525 billion in corporate income taxes — 1.8% of GDP — in 2024 and $490 billion — 1.6% of GDP — in 2025, according to the CBO's update to its budget and economic outlook for 2024 to 2034. Corporate tax revenues are projected to continue to decline past 2025 after scheduled expirations and phase downs of the Tax Cuts and Jobs Act  provisions, including one requiring scheduled payments for a one-time tax on corporate foreign profits that won't continue past 2026, the CBO said.


Blogs and bits

AbbVie Says IRS Can't Treat $1.6B Break Fee As Capital Loss - Kevin Pinner, Law360($). "The Internal Revenue Service cannot reclassify as a capital loss a $1.6 billion payment AbbVie made to an Irish biotechnology company after their failed merger and thereby raise the pharmaceutical giant's tax bill by $572 million, the company's attorneys told the U.S. Tax Court." 

IRS Guidance Doesn't Perceive Spinoff Abuse, Official Says - Natalie Olivo, Law360($):

Recent IRS guidance limiting the corporate spinoffs that revenue officials will approve as tax-free ahead of time was designed to reflect the drafters' current views, rather than suggest perceived abuse of these transactions, a U.S. Treasury Department official said Tuesday.
The IRS in early May issued Notice 2024-38 alongside Revenue Procedure 2024-24, which reduces the range of spinoff plans that companies can bring to the agency for a private letter ruling stating that the transaction would be tax-free under Internal Revenue Code Section 355 . For example, the guidance suggests the agency will no longer give PLRs for reorganizations where a parent company wants flexibility when retaining some of its spun-off subsidiary's shares or intends to use them to pay off short-term debt.

Life Insurance Fraudster Deserves Tax Penalties, 7th Circ. Told - Kat Lucero, Law360($). "The IRS urged the Seventh Circuit to maintain nearly $400,000 in fraud penalties assessed against an Illinois man who pled guilty to falsifying his tax returns as part of a scheme to poison his wife and collect on a $20 million life insurance policy." 

Former Tax Atty Hid Pension's $22.6M, Tax Court Says - Anna Scott Farrell, Law360($). "A former attorney who promoted himself as an expert in employee stock ownership plans failed to report nearly $22.6 million in income related to his acquisition of a furniture company's overfunded pension plan, the U.S. Tax Court ruled."

What day is it?

Happy National Ice Cream Soda Day! Root beer if my first choice, but Black Cows are a go-to at my house. Use your favorite ice cream soda treat to help you stay cool today!

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About the Author(s)

Any opinions expressed or implied are those of the author and not necessarily those of Eide Bailly. Opinions found in linked items are those of the authors of the linked item, not of your bloggers or of Eide Bailly. “$” means link may be behind a paywall. Items here do not constitute tax advice.