With Congress on recess, the president signed into law legislation that reauthorizes the fuel and ticket excise taxes that support the Highway Trust Fund through the end of fiscal year 2014 and extends for one year, until July 1, 2013, the current interest rate of 3.4 percent on all new, subsidized Federal Direct Stafford Loans for undergraduate students. The IRS, meanwhile, has provided guidance to single-employer defined benefit plans in the form of questions and answers with respect to the notice requirements of section 101(j) of the Employee Retirement Income Security Act of 1974 (ERISA)
President Obama on July 6 signed the Moving Ahead for Progress in the 21st Century Act (MAP-21) (HR 4348 ), which raises $20.4 billion in revenue and reauthorizes the fuel and ticket excise taxes that support the Highway Trust Fund through the end of fiscal year 2014 (TAXDAY, 2012/07/09, W.1 ). The bill raises $9.4 billion by stabilizing interest rates for pension funds and about $9.8 billion from changes to single-employer pension plans.
The legislation also expands taxation of roll-your-own cigarettes and extends the six excise taxes that fund the federal Highway Trust Fund, including the 4.3-cents-per-gallon fuels tax. In addition, the legislation extends the ability of employers to transfer excess pension assets (420 transfers) to fund retiree health benefits and expands the provision to allow transfers for retiree life insurance.
The Treasury Inspector General for Tax Administration (TIGTA) issued an audit report finding that the Exempt Organizations (EO) function did not always control or process referrals identifying tax-exempt entities in a timely manner (TAXDAY, 2012/07/03, T.1 ). Referral Unit management conceded that current requirements could not be met and should be reconsidered.
ERISA Guidance. The IRS has provided guidance to single-employer defined benefit plans in the form of questions and answers with respect to the notice requirements of section 101(j) of ERISA (Notice 2012-46 ; TAXDAY, 2012/07/06, I.2 ). The guidance includes answers to 10 questions covering various topics such as timing requirements, limitation on benefit accruals, and methods of providing a section 101(j) notice to participants and beneficiaries when certain limitations on plan benefits take effect under ERISA section 206(g) and Code Sec. 436 .
ETAAC Annual Report. The Electronic Tax Administration Advisory Committee (ETAAC) has presented its 2012 Annual Report to Congress (IR-2012-67 ; TAXDAY, 2012/07/02, I.1 ). Highlights of the report include recommendations on reinforcing standards for security, privacy, and fraud prevention; moving forward on e-file of employment tax and information returns; creating Internet tools for taxpayers and tax professionals, and funding Modernized e-File (MeF) and Customer Account Data Engine 2 (CADE 2) to completion.
By Jeff Carlson and Jennifer J. Rodibaugh, CCH News Staff