The Treasury and IRS have released their second quarter update to the 2017-2018 Priority Guidance Plan. The updated 2017-2018 Priority Guidance Plan now reflects 29 additional projects, including 18 projects that have become near term priorities as a result of the Tax Cut and Jobs Act of 2017.
Take away. As in the past but make more urgent by the Tax Cuts and Jobs Act, the IRS intends to update it cumulative 2017-2018 Priority Guidance Plan to consider comments received from taxpayers and tax practitioners relating to additional projects and to respond to developments arising during the plan year.
Response to new law
Part 1 of the updated Priority Guidance Plan, “Initial implementation fo Tax Cuts and Jobs Act (TCJA),” contains plans for guidance on 18 targeted areas, including the following:
- Code Sec. 45S business credits with respect to wages paid to qualifying employees during family and medical leave;
- Application of the effective date provisions under Code Sec. 162(m) to the elimination of the exceptions for commissions and performance-based compensation from the definition of compensation subject to the deduction limit;
- Fines and penalties under Code Sec. 162(f) and new Code Sec. 6050X;
- Computational, definitional, and other matters under new Code Sec. 163(j) on the deduction of business interest;
- Bonus depreciation under new Code Sec. 168(k);
- Computational, definitional, and anti-avoidance matters under the new Code Sec. 199A passthrough deduction;
- Adopting new small business accounting method changes under Code Sec. 263A, 448, 460 and 471;
- Implementing changes to Code Sec. 529 college savings plans;
- Implementing changes to Code Sec. 1361 regarding electing small business trusts;
- Computation of estate and gift taxes to reflect changes in the basic exclusion amount; and
- Withholding under Code Secs. 3402 and 3401 and optional flat rate withholding.
Although IRS officials have said that its updated list is not exclusive, they have emphasized that the items on the list will be its first order of business, which it hopes to get through by July. Treasury Secretary Steven Mnuchin predicted in mid-January 12 that the IRS will hire more employees to implement the Tax Cuts and Jobs Act: “Our number one issue is implementing the new tax law,” Mnuchin said.