Welcome back to "IRS Bulletin Notes," where we break down the latest IRS tax bulletins into bite-sized, easy-to-digest summaries. Our goal is to save you time and keep you informed about the most important updates and changes in the tax world. Let's dive into IRS Bulletin No. 2024-23 and highlight the key takeaways for tax professionals.
HIGHLIGHTS OF INTERNAL REVENUE BULLETIN 2024-24 – June 10, 2024
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The Internal Revenue Bulletin (IRB) is the authoritative instrument for announcing official rulings and procedures of the IRS and for publishing Treasury Decisions, Executive Orders, Tax Conventions, legislation, court decisions, and other items of general interest.
ADMINISTRATIVE
Rev. Rul. 2024-11, page 1459.
Interest rates: underpayments and overpayments. The rates for interest determined under Section 6621 of the code for the calendar quarter beginning July 1, 2024, will be 8 percent for overpayments (7 percent in the case of a corporation), 8 percent for underpayments, and 10 percent for large corporate underpayments. The rate of interest paid on the portion of a corporate overpayment exceeding $10,000 will be 5.5 percent.
EMPLOYEE PLANS
Notice 2024-40, page 1612.
This notice sets forth updates on the corporate bond monthly yield curve, the corresponding spot segment rates for April 2024 used under § 417(e)(3)(D), the 24-month average segment rates applicable for May 2024, and the 30-year Treasury rates, as reflected by the application of § 430(h)(2)(C)(iv).
EXEMPT ORGANIZATIONS
Announcement 2024-22, page 1673.
Revocation of IRC 501(c)(3) Organizations for failure to meet the code section requirements. Contributions made to the organizations by individual donors are no longer deductible under IRC 170(b)(1)(A).
Announcement 2024-23, page 1674.
The Internal Revenue Service has revoked its determination that Functional Health Inc qualifies as an organization described in sections 501(c )(3) and 170(c )(2) of the Internal Revenue Code of 1986. The revocation is effective January 31, 2018. If a suite for declaratory judgment has been timely filed, contributions from individuals and organizations described in section 170(c )(2) that are otherwise allowable will continue to be deductible. Protection under section 7428(c ) would begin on January 1, 2018 and would end on the date the court first determines the organization is not described in section 170(c )(2) as more particularly set for in section 7428(c )(1). For individual contributions, the maximum deduction protected is $1,000, with a husband and wife treated as one contributor. This benefit is not extended to any individual, in whole or in part, for the acts or omissions of the organization that were the basis for revocation.
INCOME TAX
Announcement 2024-24, page 1675.
This announcement notifies taxpayers of the applicable Reference Standard 90.1 required under § 179D(c)(2) of the Internal Revenue Code as part of the definition of energy efficient commercial building property (EECBP). This announcement supplements and supersedes Announcement 2023-1, 2023-3 I.R.B. 422 (2023), by affirming ASHRAE/IES Reference Standard 90.1-2022 as the applicable Reference Standard 90.1 for EECBP placed in service after December 31, 2028, and the construction of which did not begin by December 31, 2022.
Notice 2024-36, page 1479.
This notice clarifies and amplifies the previously established § 48C(e) guidance and allocation procedures published in Notices 2023-18 and 2023-44 by announcing the second round of credit allocations under the § 48C(e) program to allocate approximately $6 billion of § 48C credits, with approximately $2.4 billion in § 48C credits to be allocated to projects located in § 48C(e) Energy Communities Census Tracts. The notice also updates appendices A, B and C. Appendix A and B clarify § 48C(e) program priorities for this second round of allocations. Appendix C updates the list of § 48C(e) Energy Communities Census Tracts.
Notice 2024-39, page 1611.
This notice publishes the inflation adjustment factor for the carbon oxide sequestration credit under § 45Q for calendar year 2024. The inflation adjustment factor is used to determine the amount of the credit allowable under § 45Q for taxpayers that make an election under § 45Q(b)(3) to have the dollar amounts applicable under § 45Q(a)(1) or (2) apply. This notice also obsoletes Notice 2009-83 and Notice 2011-25.
Notice 2024-41, page 1615.
This notice modifies the existing domestic content safe harbor in Notice 2023-38, 2023-22 I.R.B. 872, by expanding the non-exclusive list of “Applicable Projects” in “Table 2--Categorization of Applicable Project Components” from Notice 2023-38 to include hydropower and pumped hydropower storage facilities, redesignating the “Utility scale photovoltaic system” Applicable Project as “Ground-mount and rooftop photovoltaic system,” and including certain Manufactured Product Components for previously listed Applicable Projects for the domestic content bonus credit amounts under §§ 45, 45Y, 48, and 48E of the Internal Revenue Code. The notice also provides a new elective safe harbor that taxpayers may use to classify Applicable Project Components and to calculate the Domestic Cost Percentage in an Applicable Project to qualify for the domestic content bonus credit amounts, and requests comments regarding the new elective safe harbor to inform the development of any future updates.
REG-124850-08, page 1624.
U.S. persons must report information about, and pay income taxes with respect to, certain transactions with foreign trusts. U.S. persons also must report information to the IRS when they receive large gifts, bequests, devises, or inheritances (foreign gifts) from foreign persons. The proposed regulations describe the transactions and the foreign gifts that must be reported to the IRS, as well as identify the U.S. persons who must report them and pay any corresponding income taxes. U.S. persons who fail to timely report this information to the IRS are subject to significant penalties, and the proposed regulations provide guidance regarding these penalties. Additionally, U.S. persons are treated as the owners of certain foreign trusts that have U.S. beneficiaries. The proposed regulations explain which foreign trusts have U.S. beneficiaries and identify the U.S. persons who are treated as the owners of these foreign trusts. REG-124850-08. Published May 8, 2024.