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November 21, 2021
2021-2117

U.S. Tax This Week for November 19

Ernst & Young's U.S. Tax This Week newsletter for the week ending November 19 is now available. Prepared by Ernst & Young's National Tax Department in Washington, D.C., this weekly update summarizes important news, cases, and other developments in U.S. taxation.

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Top of the Week

House approves Build Back Better Act reconciliation bill

The House on November 19 approved by a 220-213 vote the Build Back Better Act (H.R. 5376) reconciliation bill that includes social spending measures on health, climate, low-income tax credits and many other issues, paid for with tax increases on corporations and individuals. House Democratic leaders' plans to vote on the bill last night were delayed given a more than eight-hour speech in opposition to the bill by Republican leader Kevin McCarthy (R-CA), who criticized the tax increases in the plan among many other issues. EY Tax Alert 2021-9027 has details.

IRS releases 2022 inflation adjustments for fringe benefits and Form W-2/1099 information reporting penalties

In Revenue Procedure 2021-45 the IRS announced the 2022 inflation adjustments that will apply to certain fringe benefits and to Form W-2/1099 information reporting penalties. EY Tax Alert 2021-2111 has details.

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Upcoming Webcasts

Examining implications of new Chief Counsel memorandum on research-credit-based refund claims (November 30)
During this EY Webcast, please join our panel of Research Credit leaders for a discussion of the memorandum’s contents and implications, including the potential consequences of compliance and non-compliance.

2021 Year-end tax planning and other hot topics for asset managers (December 2)
During this EY Webcast, our panel of distinguished Asset Management tax professionals will share their insights on what the Build Back Better reconciliation package means for PE and alternative fund asset managers and their investors.

Domestic tax quarterly webcast series: A focus on state tax matters (December 2)
During this EY Webcast, panelists from Ernst & Young LLP’s Quantitative Economics & Statistics and Indirect Tax practices will highlight the results of the latest EY study prepared for the Council On State Taxation (COST) on state business tax burdens, provide a state fiscal update and discuss tax policy issues that will be top of mind in 2022.

2021 employment tax year in review (December 7)
In meeting their 2021 year-end employment reporting requirements, employers will need to address the unique challenges created by temporary federal and state COVID-19 provisions while also following other necessary procedures for closing the tax year. During this EY Webcast, Ernst & Young Employment Tax and Benefits professionals will discuss several common areas of year-end employment tax concern.

Tax aspects of the LIBOR transition: What to consider for year-end (December 16)
During this EY Webcast, Ernst & Young professionals will discuss tax considerations of the London Interbank Offered Rate (LIBOR) transition and what steps multinational companies can take before the year-end to prevent disruption.

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Recent Tax Alerts

Internal Revenue Service

— Nov 18: IRS rules large, unanticipated grant to public charity won't adversely affect public support requirements (Tax Alert 2021-2112)

— Nov 18: IRS releases 2022 inflation adjustments for fringe benefits and Form W-2/1099 information reporting penalties (Tax Alert 2021-2111)

— Nov 17: IRS clarifies that temporary 100% deduction for restaurant meals applies to meal portion of per diem payments (Tax Alert 2021-2104)

— Nov 17: Tax M&A Update October 2021 (Tax Alert 2021-2102)

— Nov 15: QUEST Economic Update highlights key US and global economic trends — November 15, 2021 (Tax Alert 2021-2090)

International

— Nov 18: Austrian Ministry of Finance publishes draft bill to reduce Corporate Income Tax and introduce Carbon Tax (Tax Alert 2021-2114)

— Nov 18: UK | Review of the new Asset Holding Company regime (Tax Alert 2021-2113)

— Nov 18: Israel implements new policies for international inbound travelers (Tax Alert 2021-2109)

— Nov 17: Tanzania issues regulations on VAT exemption management procedures (Tax Alert 2021-2099)

— Nov 16: Poland submits new draft law on the employment of foreigners to Parliament (Tax Alert 2021-2092)

— Nov 16: The Latest on BEPS and Beyond for November 2021 (Tax Alert 2021-2091)

— Nov 16: Belgium implements new tax regime for inbound taxpayers and researchers (Tax Alert 2021-2088)

— Nov 15: Ireland announces relaxed entry measures for Christmas period and reduced document requirements for citizenship applications (Tax Alert 2021-2086)

— Nov 15: Asean Mobility Spotlight (November 10) (Tax Alert 2021-2085)

— Nov 15: Philippines proposes law imposing VAT on nonresident digital service providers (Tax Alert 2021-2084)

— Nov 12: Brazilian tax authority limits nonresident capital gains tax on the sale of Brazilian shares by a Portuguese investor to 15% (Tax Alert 2021-2076)

— Nov 12: Ecuador's National Assembly to discuss tax reform bill (Tax Alert 2021-2074)

— Nov 12: PE Watch | Latest developments and trends, November 2021 (Tax Alert 2021-2068)

— Nov 12: Kenya Tax Appeal Tribunal rules on use of Transaction Value Method for customs valuation (Tax Alert 2021-2067)

— Nov 12: Singapore provides update on Goods and Services Tax (Tax Alert 2021-2066)

— Nov 12: European Parliament provides final approval needed for formal adoption of public CbCR Directive (Tax Alert 2021-2061)

Legislation

— Nov 18: Departments issue rule detailing new requirements for health plans and insurers to report on prescription drug and health spending (Tax Alert 2021-2110)

— Nov 17: Small businesses investing in certain energy technologies eligible for new federal grant program under Infrastructure Investment and Jobs Act (Tax Alert 2021-2101)

— Nov 17: Ways & Means subpanel holds Opportunity Zone hearing (Tax Alert 2021-2098)

— Nov 17: What to expect in Washington (November 17) (Tax Alert 2021-2097)

— Nov 12: Infrastructure bill will retroactively repeal fourth-quarter 2021 employee retention credits (Tax Alert 2021-2075)

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Recent Newsletters

State and Local Tax Weekly
   Highlights of this edition include:

— Council on State Taxation (COST) releases EY report on the state and local taxes paid by businesses in fiscal year 2020. In a newly released report, "Total state and local business taxes, State-by-state estimates for FY 2020," prepared in conjunction with the Council on State Taxation (COST) and State Tax Research Institute (STRI), EY's Quantitative Economics and Statistics Group estimates the state and local taxes paid by businesses in fiscal year 2020 (FY20).

— Connecticut's tax amnesty program runs through January 31, 2022. The Connecticut Department of Revenue Services (CT DRS) is conducting a tax amnesty program that began Nov. 1, 2021 and ends Jan. 31, 2022.

— Income/Franchise, Sales & Use, Business Incentives, Compliance & Reporting, Payroll & Employment Tax, Upcoming Webcasts

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IRS Weekly Wrap-Up

Revenue Procedures

 2021-4526 CFR 601.602: Tax forms and instructions
 2021-4726 CFR 601.105 Examination of returns and claims for refund, credit or abatement; determination of correct tax liability - (Also: Part I, §§ 139, 163, 164, 6041, 6041A, 6050H, 6721, 6722, 6724; §§ 1.6041-1, 1.6050H-1(e)(ii), 1.6050H-3(b))
 2021-4826 CFR 601.105: Examination of returns and claims for refund, credit or abatement; determination of correct tax liability - (Also Part I, § 61.)
 2021-4926 CFR 601.105: Examination of returns and claims for refund, credit or abatement; determination of correct tax liability - (Also Part I, §§ 704, 705, 1502; 1.1502-32.)
 2021-5026 CFR 601.601. Rules and regulations

Revenue Rulings

 2021-23Section 1274.—Determination of Issue Price in the Case of Certain Debt Instruments Issued for Property

Notices

 2021-62Update for Weighted Average Interest Rates, Yield Curves, and Segment Rates
 2021-63Temporary 100-Percent Deduction Applies to Meal Portion of 2021 and 2022 Per Diem Rate or Allowance

Because the matters covered herein are complicated, U.S. Tax This Week should not be regarded as offering a complete explanation and should not be used for making decisions. Any decision concerning matters covered herein should be reviewed with a qualified tax advisor.

 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

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