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October 15, 2021

IRS updates procedures for certain FAQs on newly enacted tax laws, clarifies penalty protection provided by good-faith reliance on FAQs

The IRS has announced (IR-2021-202) it is updating its process for certain frequently asked questions (FAQs) on newly enacted tax legislation, seeking to address concern regarding transparency and the potential impact on taxpayers when the FAQs are updated or revised. Further, the IRS clarifies that a taxpayer that relies in good faith on IRS FAQs will have a "reasonable cause" defense against any negligence penalty or other accuracy-related penalty. A Tax Alert is forthcoming.