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Elder Law Certified Lawyer | Estate Plan and Tax Plan | Business Law

No, I don’t mean think about anything fast, and I don’t mean for you to fast. Instead be aware of “FAST” – Fixing America’s Surface Transportation Act (the “Act”), H.R. 22 passed on 12/3/15 by both houses and reported out of conference committee on 12/7/15.

You may think that the Act is all about funding our roads and bridges with new gas and diesel and tire and another three excise taxes through the year 2020.  However, you would only be partially correct.  The Act keeps the same rates and extends the Highway Trust Fund, the Sport Fish Restoration and Boating Trust Fund and the Leaking Underground Storage Tank (LUST) Trust Fund.

But, of course, there is more!  The following Tax Legislation is included:

  1. Automatic extension for filing form 5500 series (pension, profit sharing, 401(k) etc.) was 3 ½ months under the legislation passed recently, but under FAST it is back to 2 ½ months.
  2. Establishes “Special Compliance Personnel” as field collection officers employed to collect taxes as employees of IRS funded by 25% of the collection revenue under new Section 6307.
  3. Requires the IRS to enter into “qualified tax collection contracts” for the collection of all outstanding “inactive tax receivables” included by IRS in its potentially collectible inventory, and funds that activity with another 25% of the Section 6307 revenue. Certain receivables are not eligible for collection by private collectors, including those subject to a pending or active offer in compromise, installment agreement, classified as innocent spouse case or which involve taxpayers that are deceased, under age 18 or are identity theft victims.
  4. Adds new Section 7345, which permits the IRS to disclose certain information to the State Department of “seriously delinquent taxpayers” in order to prevent those persons from obtaining a passport, revoking an existing one, or limiting the use of it. Taxpayers whose obligation is $50,000 (to be adjusted annually for inflation) or more, subject to a filed lien, notice of levy, with no agreement for repayment, and no collection due process hearing is pending and no other relief is pending are the target population.

The effective date will be on the date the Act is signed by the President, or as specified in certain provisions. These are basically a means to fund IRS collections without giving IRS more revenue. Private collectors were not successful before and were basically cancelled by another act in 2009.