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Now that the Tax Cuts and Jobs Act of 2017 (TCJA) has become law, taxpayers are looking forward to additional guidance from the IRS and Treasury Department on the various provisions.

Late last week, the Treasury Department and IRS released an update to their annual Priority Guidance Plan. This plan identifies the guidance projects that the agencies hope to complete during the fiscal year. The priorities are set based on public input and a process described in an executive order.

This update includes 29 additional projects, many of which became priorities after the TCJA was signed into law. Because of the immediate impact of some provisions in areas like international taxation and payroll withholding, the agencies already issued some interim guidance in January. The plan describes the guidance agenda for the rest of the government’s fiscal year.

Tax_Icons-01  Guidance Coming by June 30

According to the updated plan, between now and June 30th, IRS/Treasury intends to release guidance in areas such as:

  • The new limitation on business interest expense deductions (and exceptions thereto),
  • The new 20% qualified business income deduction,
  • Transition rules for 100% bonus depreciation, and
  • Guidance for adopting the new small business accounting method changes (use of cash method, no maintenance of inventories or uniform capitalization, use of completed contract).

Tax_Icons-02  Guidance In the Near Future

Other provisions scheduled for guidance in the near future include:

  • The new business credit for wages paid to employees during family and medical leave,
  • More stringent executive compensation limits for publicly-traded companies,
  • Definitions and guidance for opportunity zones, and
  • Updates to estate and gift tax basic exclusion rules.

The priority list goes on to cover a number of other international and nonprofit items.

Tax_Icons-03  What's Missing

Notably absent from the current-year priority list are provisions like:

  • Net operating loss transition issues,
  • Utilization of corporate AMT credits, and
  • The new excess business loss rules for individuals.

Look for some of the earliest guidance to be issued in the form of IRS revenue rulings, revenue procedures, announcements, notices, and FAQs. Treasury regulations will likely take longer to propose and finalize, but those will also be more comprehensive and provide more reliable precedent for tax planning.

We will be monitoring all of this, and providing clear guidance as available. As you have questions, please contact your HORNE Tax advisor, and we will help you every step of the way.

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John D. Scott, CPA, is a partner in tax services and serves as a member of the HORNE board of directors. John joined HORNE in 2002 and has more than 25 years of public accounting experience serving as a tax advisor to corporate, flow-through and individual clients. He has participated in providing value-added tax services to clients including: tax compliance and planning, state and local tax restructuring, IRS practice, acquisition planning and structuring of transactions.

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