IRS Updates Three Important FAQS

Work-Life Referral Programs

The Internal Revenue Service (IRS) has issued a set of frequently asked questions (FAQs) outlined in Fact Sheet 2024-13. These FAQs address the tax implications surrounding work-life referral services offered to employees as part of an employer's work-life referral program.

A work-life referral program is a fringe benefit funded by the employer, aimed at providing eligible employees with access to work-life referral services.

These services are limited to informational and referral consultations designed to aid employees in identifying, contacting, and negotiating with various life-management resources to address personal, work-related, or family challenges. Examples include selecting suitable child or dependent care programs, connecting with local retirement or financial planners, or navigating eligibility for government benefits.

The FAQs provide clarification that, under specific circumstances, the value of work-life referral services provided to employees through such a program may qualify for exclusion from income and employment taxes as de minimis fringe benefits.

New, Previously Owned and Qualified Commercial Clean Vehicle Credits

The Internal Revenue Service (IRS) updated FAQs in Fact Sheet 2024-14 regarding the New, Previously Owned, and Qualified Commercial Clean Vehicle Credits.

Revisions include:

• Topic A: Eligibility Rules for the New Clean Vehicle Credit: Revised Question 10.

• Topic B: Income and Price Limitations for the New Clean Vehicle Credit: Revised Question 11.

• Topic H: Transfer of New Clean Vehicle Credit and Previously Owned Clean Vehicle Credit: Revised Questions 5 and 15.

Energy Efficient Home Improvement and Residential Clean Energy Property Credits

The Internal Revenue Service (IRS) updated FAQs in Fact Sheet 2024-15 regarding the federal income tax treatment of payments made for the acquisition of energy-efficient property and improvements.

Revisions include:

• General questions— Question 4: On April 5, 2024, the IRS issued Announcement 2024-19PDF addressing the federal income tax treatment of payments made for energy-efficient property and improvements.

• Generally, taxpayers who receive rebates for energy-efficient home purchases won't include the rebate value as income on their tax returns. However, they'll need to decrease the property's basis by the rebate amount when selling it.

• The Inflation Reduction Act (IRA) categorizes performance-based incentives and electrification product subsidies as "rebates."

• Announcement 2024-19 specifies that amounts received from Department of Energy (DOE) home energy rebate programs funded through the IRA will reduce the purchase price or cost of eligible upgrades and projects. Consequently, consumers receiving an IRA rebate won't need to report its value as income.

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Disclaimer: This article is for informational and educational purposes only and does not constitute legal tax advice. Advanced Tax Solutions is not liable or responsible for any damages resulting from or related to your use of this information. It is your responsibility to refer to official IRS documentation for information regarding any tax laws or tax information shown here.