IRS to Payroll: Roll up your sleeves and get to work

The IRS has taken the boredom out of the last, torrid days of summer 2016 by releasing its annual priority guidance plan—its business plan, in tax lingo—for the fiscal year ending June 30, 2017. Payroll figures prominently.

Note: The plan is always subject to change, especially if the IRS needs to accommodate last-minute legislation.

What to expect

The IRS has 281 projects on its plate, relatively unchanged from the 277 it pegged last year.

The IRS issues public guidance in many forms: regulations, announcements, notices, revenue procedures, revenue rulings, etc. Not all of them will get done by the end of next June, of course, and some keep making appearances year after year.

However, all forms of public guidance have the force of law and you ignore them at your peril. Here’s what you have to look forward to:

  • Regulations under Sections 119 and 132 on when or whether employer-provided meals are taxable
  • Regulations updating the ESOP rules
  • Guidance on the timing of the use or allocation of forfeitures in 401(k) plans
  • Final regulations on employees’ Section 83(b) elections
  • Final revenue procedure on employees’ consent to FICA refunds
  • Guidance regarding employers’ qualified nonelective contributions and qualified matching contributions into 401(k) plans
  • Guidance concerning the small business research and development payroll tax credit
  • Guidance regarding employees’ substantiation of hardship distributions from retirement plans
  • Guidance related to the employer play-or-pay and free-rider provisions of the Affordable Care Act
  • Regulations on the excise tax (i.e., the Cadillac tax) on high-cost employer-provided group health plans.

Click here to read the IRS annual priority guidance plan.