The IRS yesterday issued guidance on the safe harbor from penalties for tax filers making de minimis errors when filing information returns. Under the safe harbor — established in the PATH Act of 2015 — an error is not required to be corrected, and no penalty is imposed, if the error results in a reporting difference of $100 ($25 in the case of an error related to tax withheld) or less. However, the safe harbor does not apply if a payee elects out of the rule. The IRS notice provides background on the operation of the rules and indicates that formal regulations will be issued in the future. Comments on the notice are requested by April 24. For more information, contact ABA’s John Kinsella.
With failure on procedural motion, Clarity Act’s future is uncertain
The Senate voted 50-49 against ending debate on the Clarity Act. By failing to reach the 60-vote threshold needed for cloture, senators signaled their unwillingness to pass the legislation in its current form.
