The American Institute of CPAs has written a letter to some of the top tax lawmakers in Congress asking them to grant relief to taxpayers in appropriate situations when they miss a statutory deadline or make an error in choosing an election.
Some of the many tax elections available to taxpayers permit administrative relief under section 9100 of the Tax Code if the election is made late or it wasn’t executed correctly because the deadlines were established in Treasury regulations, but often the elections with deadlines set by statute do not offer the same relief, the AICPA pointed out in the letter it sent Friday to lawmakers.
The AICPA reminded lawmakers that relief under section 9100 “is extremely valuable for taxpayers who miss the opportunity to make certain tax elections” and that “Congress should consider making section 9100 relief available for all tax elections, whether prescribed by regulation or statute.”
In its letter, the AICPA listed 26 elections (not all-inclusive) for which section 9100 relief is not currently granted because the deadline for claiming such elections is set by statute.
Among the items cited are the election for the month in which a building is placed in service for the Low-Income Housing Credit, the election to amortize certain research and development expenditures, the election to treat certain costs of a film or TV production as an expense, and the election to waive a net operating loss carryback for a standalone entity return.
In order for the IRS to grant relief under section 9100, the IRS must have the authority to do so and taxpayers must show that they acted reasonably and in good faith and that the grant of relief will not prejudice the interests of the government, the AICPA noted.
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