Monthly Newsletter
IRS NEWS & GUIDANCE YOU NEED TO KNOW (AUG–SEP 2025)
R&E Expenditures (Rev. Proc. 2025-28)
New guidance clarifies elections, amended returns, and method changes under OBBBA for Secs. 174, 174A, and 280C.
Small businesses may apply retroactive treatment for domestic R&E costs (post-2021, pre-2025).
Payroll & Information Returns
IRS confirmed no changes for tax year 2025 to Forms W-2, 1099, or withholding tables.
OBBBA-mandated reporting for tips and overtime will begin in 2026.
Energy Credits & Deductions
FAQs (Fact Sheet 2025-05) explain accelerated termination of several credits and deductions (Secs. 25C, 25D, 25E, 30C, 30D, 45L, 45W, 179D).
Important for clients with energy-efficient property or clean energy investments.
AICPA Advocacy
AICPA urged IRS to clarify retroactive research expense deductions (Sec. 174A).
Comments submitted on proposed regs for corporate separations/reorganizations, highlighting documentation challenges.
Key IRS / Treasury Updates — Oct 2025
IRS releases tax year 2026 inflation adjustments (Revenue Procedure 2025-32
On Oct. 9, the IRS issued inflation adjustments for over 60 tax provisions for tax year 2026, which incorporate changes from the One, Big, Beautiful Bill (OBBB). IRS+13IRS+31RS+3
Implication for CPAs: Update tax-planning models, with attention to changes in rate brackets, standard deductions, and indexed thresholds under OBBB.
Penalty relief for remittance transfer providers (Notice 2025-55)
On Oct. 7, Treasury and IRS issued guidance offering limited deposit penalty relief for providers of remittance transfers who may miscalculate remittance transfer excise tax for the first three quarters of 2026, so long as timely deposits are made and underpayments are paid by the quarterly return deadline. IRS+1
Implication for CPAs: For clients in the remittance (money transfer) business, this gives some breathing room during the early transition period under the new OBBB excise tax regime.
Leadership & structural change — Jarod Koopman named Acting Chief Tax Compliance Officer
On Oct. 6, the IRS announced that Jarod Koopman would oversee enforcement functions at the agency under a new role. IRS+1
Implication for CPAs: This signals a stronger focus on enforcement and compliance. Be alert for shifts in audit priorities, communications, and emphasis from the IRS.
IRS launches Post Appeals Mediation pilot
On Oct. 1, the IRS Independent Office of Appeals rolled out a two-year Post Appeals Mediation pilot to allow an alternative path for resolving disputes after appeals. IRS+1
Implication for CPAs: This offers a potentially attractive mechanism for resolving contested issues without further litigation or protracted negotiation. Evaluate whether clients with pending appeals should consider mediation.
Extension of feedback period on draft Form 6765 (Research Credit)
Also on Oct. 1, the IRS extended the comment period for the draft instructions and reporting rules for Form 6765 (Credit for Increasing Research Activities). IRS
Implication for CPAs: Firms and clients engaged in R&D should consider submitting comments and closely monitor final guidance. Also, planning for 2025 R&D elections (accelerated deduction vs amortization) will remain uncertain until this is resolved.
IRS contingency planning during shutdown / furloughs
Because of the lapse in appropriations, the IRS began furloughing many non-excepted employees starting Oct. 8, 2025, retaining only essential personnel. IRS+3Submission & Cromwell +3Current Federal Tax Developments+3
The IRS has published a contingency plan outlining which operations will continue from Oct. 8, 2025 through April 30, 2026. Current Federal Tax Developments+1
Implication for CPAs: Expect delays in many IRS services (audits, correspondence, processing). Be proactive in managing client expectations. Prioritize critical IRS filings and communications, and consider earlier submissions where possible.
IRS reminds taxpayers with extension of the Oct. 15 deadline
On Oct. 14, the IRS reminded taxpayers who had filed for extension that their 2024 returns are due by Oct. 15, and that the shutdown does not change that obligation. IRS
Implication for CPAs: Ensure that extension clients understand they still must file by the deadline and pay any balance due timely to avoid penalties and interest.
IRS QuickAlert: Tax Year 2025 Assurance Testing System (ATS) now Open
The IRS has opened the Modernized e-File (MeF) Assurance Testing System for Tax Year 2025 as of October 1, 2025.
Software developers and transmitters must complete the ATS Questionnaire for each tax software package they plan to test. Only authorized e-file users with Principal, Responsible Official, or Delegate roles can submit questionnaires and obtain a Software ID number.
For assistance, contact the IRS e-Help Desk at 866-255-0654.
December 2025 Tax Update — OBBBA Year-End Highlights
D Tax Accounting | CPA & Advisor Newsletter
As 2025 comes to a close, implementation of the One Big Bountiful Bill Act (OBBBA) is accelerating. December brought important clarifications and operational guidance that CPAs should factor into year-end filings and early 2026 planning.
IRS Clarifies OBBBA Reporting Expectations
The IRS released December guidance addressing documentation and reporting standards tied to newly modified credits and deductions under OBBBA. Emphasis was placed on accurate disclosures and consistency across individual and business returns.
CPA Takeaway: Review supporting schedules carefully to avoid processing delays or follow-up notices.
Treasury Confirms 2025–2026 Transition Rules
Treasury reiterated that several OBBBA provisions will phase in starting in 2026, affecting deduction limits, income thresholds, and payroll-related calculations.
CPA Takeaway: Separate 2025 compliance decisions from 2026 planning strategies when advising clients.
Heightened Review of Year-End Refund Claims
The IRS confirmed additional review measures for refund claims filed late in the year, particularly those involving OBBBA-related credits or amended returns.
CPA Takeaway: Set client expectations for longer processing times and ensure strong documentation is included with filings.
IRS Signals Expanded Automated Compliance in 2026
IRS officials announced increased use of automated matching and compliance tools beginning in early 2026, focusing on income reporting, credit eligibility, and payroll consistency.
CPA Takeaway: Accuracy and internal consistency will be critical to minimizing notices and delays.
Year-End Filing Deadlines Remain Unchanged
The IRS reaffirmed that OBBBA does not modify standard filing or payment deadlines.
CPA Takeaway: Ensure clients file and pay on time to avoid penalties and interest.
How D Tax Accounting Supports You
We assist CPAs and their clients with complex filings, IRS correspondence, and matters impacted by legislative changes.
January 2026 Tax Update — Early Compliance & Enforcement Focus
D Tax Accounting | CPA & Advisor Newsletter
As 2026 begins, the IRS and Treasury are shifting from transition guidance to active enforcement and operational rollout of recent legislative and procedural changes. January updates signal a stronger emphasis on compliance accuracy, automated reviews, and early-year planning discipline for both individual and business taxpayers.
IRS Expands Early-Year Compliance Reviews
The IRS announced increased early-season compliance checks for returns filed in Q1 2026, particularly those involving credits, carry forwards, and prior-year adjustments. Returns with inconsistencies between transcripts and filings may see faster automated notices.
CPA Takeaway: Double-check prior-year data, carryovers, and reconciliations before filing to avoid early IRS correspondence.
No Relief Announced for Early 2026 Deadlines
The IRS reiterated that there are no deadline extensions or transitional relief provisions for early 2026 filings or payments related to recent legislative changes.
CPA Takeaway: Timely filing and payment remain essential to avoiding penalties and interest.
Increased Focus on Estimated Tax Accuracy
Treasury and IRS officials emphasized closer monitoring of estimated tax payments for self-employed individuals, passthrough entities, and closely held businesses. Underpayment mismatches are expected to trigger automated alerts earlier in the year.
CPA Takeaway: Review estimated tax calculations now and adjust first-quarter payments to align with updated income projections.
Automated Notices Roll Out Faster in 2026
IRS officials announced increased use of automated matching and compliance tools beginning in early 2026, focusing on income reporting, credit eligibility, and payroll consistency.
CPA Takeaway: The IRS confirmed that expanded automation will reduce lag time between filing and notice issuance. CP2000 and under reporter notices may appear sooner than in prior years.
IRS Reinforces Documentation Standards for Credits
January guidance reaffirmed strict documentation requirements for refundable and non-refundable credits, including business credits and personal tax incentives carried into 2026. Incomplete substantiation may result in delays or partial disallowance.
CPA Takeaway: Ensure documentation is assembled and retained before filing — not after an IRS request.
How D Tax Accounting Supports You
We support CPAs and their clients with proactive planning, IRS correspondence management, audit representation, and compliance strategy — helping reduce risk as enforcement tools and automation expand in 2026.
Wage & Income Transcript (and sometimes the Account Transcript)
can reduce CP2000 risk
