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The latest wave of changes out of the Internal Revenue Service includes a host of relief measures, from disaster assistance in the wake of Hurricane Milton to halting the practice of immediate penalties for late reports of foreign gifts and inheritance. But with the results of the presidential election, much is uncertain about the IRS’s path forward.

Throughout his campaign, Donald Trump made repeated pledges to institute tax breaks for caregivers, domestic car purchases and U.S. citizens living overseas, with further considerations towards excusing police officers, firefighters, and both current and retired military members from paying taxes.

Following Trump’s Nov.5 win, cementing his return to the White House in 2025, many across the accounting profession are now in a “wait and see” period to see which pledges, if any, he makes good on.”The Republicans’ control of the Senate makes it much more likely that Republicans will be able to implement many of Trump’s proposed tax policies, such as making parts of the expiring 2017 [Tax Cuts and Jobs Act] provisions permanent,” said John Gimigliano, principal in charge of the federal legislative & regulatory services group within KPMG’s Washington National Tax practice, in a statement.

Read more: Trump’s victory: What it means for taxes

Funding for the IRS has been a particular point of contention for the Republican party, as seen with reductions in backing from the Inflation Reduction Act of 2022.

“IRS funding is at significant risk right now,” including both “the annual appropriation funding as well as the remaining IRA funding,” said Rochelle Hodes, principal at Top 25 Firm Crowe LLP’s Washington National Tax Office.

“The only question for me on funding is, will any portion of the funding remain available for taxpayer service-related improvements at the IRS?” Hodes said.

Hodes went on to highlight the Tax Cuts and Jobs Act of 2017 as the first major priority for the incoming Trump administration, followed close behind by determining “how will the cost of that endeavor be determined,” she said.

“If the view that is held by several Senate Republicans wins the day, then the cost of extending the expiring provisions will not be counted under those particular budget rules that are created dealing with extending current policy. … If, however, that view is not adopted, then there is a high cost just to TCJA, and so any other provisions with cost will sort of stretch the boundaries of what many in Congress would be comfortable with,” Hodes said.

Read more: Trump win may threaten IRS funding

Below is a compilation of noteworthy items out of the IRS last month.

IRS is cutting late filers of foreign gift forms a break

Article by Michael Cohn

IRS executives announced last month that the agency will halt the automatic penalty process against taxpayers who delinquently file forms reporting foreign gifts and inheritance, following outcry from the American Institute of CPAs and National Taxpayer Advocate Erin Collins.

“By the end of the year the IRS will begin reviewing any reasonable cause statements taxpayers attach to late-filed Forms 3520 and 3520-A for the trust portion of the form before assessing any Internal Revenue Code § 6677 penalty,” Collins wrote in a blog post last month. 

The IRS followed up the change by emphasizing that it will begin reviewing the reasonable cause statements provided by taxpayers who late filed Forms 3520, Part IV, prior to assessing any penalties.”This favorable change will reduce unwarranted assessments and relieve burden on taxpayers by giving them the opportunity to explain their situation before the IRS assesses a penalty,” Collins said.

Read more: IRS offers penalty relief for late-filed foreign gift forms

IRS issues new benchmark for Sustainable Aviation Fuel Credit

Article by Jeff Stimpson

Guidance released by the IRS last month established the Sustainable Aviation Fuel Credit at $1.25 to $1.75 for each gallon of sustainable aviation fuel in a qualified mixture.

Qualified mixtures are required under the credit, which was created by the Inflation Reduction Act, to have a reduction of at least 50% in life cycle greenhouse gas emissions in order to be eligible.

This change is the most recent entry in the saga of the SAF credit, with other notable entries like Notice 2024-37 allowing fuel producers to employ the 40BSAF-GREET 2024 model when calculating their greenhouse gas emissions reduction percentage for the credits.

Read more: New rules for Sustainable Aviation Fuel Credit

Tax-exempt groups avoid filing requirement for 2023 corporate AMT form

Article by Michael Cohn

The IRS and the Treasury Department granted a joint filing exception on Oct. 23 for tax-exempt organizations, excusing them from submitting a Form 4626, “Alternative Minimum Tax – Corporations,” for tax year 2023.

Both agencies said tax-exempt organizations, while not required to file, should still maintain a Form 4626 in their records as documented proof of whether or not they are indeed an applicable corporation for purposes of the AMT and if so, for determining any corporate AMT liability. Liable entities will need to pay the tax and record the amount paid on Part II, Line 5 of Form 990-T, “Exempt Organization Business Income Tax Return.”

Read more: Tax-exempt groups don’t need to file corporate AMT form for 2023

The return of PTIN season

Article by Jeff Stimpson

Bloomberg via Getty Images

The expiration date for tax professionals’ Preparer Tax Identification Numbers is close at hand.

Both tax professionals and Enrolled Agents have until Dec. 31 to renew or obtain their PTIN for 2025 at $19.75 for the service. Those who currently have a PTIN will be notified by the IRS’s Return Preparer Office of the deadline in the coming weeks.

Read more: PTIN renewal season kicks off

IRS releases annual inflation adjustments for 2025

Article by Michael Cohn

The IRS issued its annual inflation adjustments on Oct. 22 for the 2025 tax year, featuring increases in standard deductions, tax credits, fringe benefits and more due to inflation.

These modifications are applicable to income tax returns filed in the 2026 tax season for the prior year with the agency’s Revenue Procedure 2024-40 outlining all of the changes to more than 60 tax provisions.

Featured dollar-amount changes that are of express importance to filers include standard deductions. 

For single taxpayers and married individuals filing separately for tax year 2025, the standard deduction climbs to $15,000 for 2025, an increase of $400 from 2024. For married couples filing jointly, the standard deduction rises to $30,000, an increase of $800 from tax year 2024. For heads of households, the standard deduction will be $22,500 for tax year 2024, an increase of $600 from the amount for tax year 2024.

Read more: IRS adjusts tax amounts for inflation for 2025

Facing a backlash from audit firms over its proposal to toughen the standards for failing to detect noncompliance with laws and regulations, the Public Company Accounting Oversight Board has decided to delay action on the standard this year.

The PCAOB proposed the so-called NOCLAR standard in June, with the goal of strengthening its requirements for auditors to identify, evaluate and communicate possible or actual noncompliance with laws and regulations, including fraud. However, the proposed standard provoked resistance from a number of auditing firms and state CPA societies like the Pennsylvania Institute of CPAs and spurred a comment letter-writing campaign organized by the Center for Audit Quality and the U.S. Chamber of Commerce that was supported by prominent business trade groups like the American Bankers Association, the Business Roundtable, the Retail Industry Leaders Association and more. 

Earlier this week, the PCAOB issued staff guidance outlining the existing responsibilities of auditors to detect, evaluate and communicate about illegal acts. The PCAOB was slated to finalize the NOCLAR standard by the end of this year, but after the election it has put the standard on hold for now, anticipating the upcoming change in the administration in Washington, D.C.

“Following the recent issuance of staff guidance, the PCAOB will not take additional action on NOCLAR this year,” said a PCAOB spokesperson. “We will continue engaging with stakeholders, including the SEC, as we determine potential next steps. As our process has demonstrated, the PCAOB is committed to listening to all stakeholders and getting it right.”

One reason for the change of plans is that the PCAOB anticipates changes in the regulatory environment under the Trump administration, especially in the Securities and Exchange Commission, which would have to approve the final standard before it could be adopted. The Trump administration is likely to replace SEC chairman Gary Gensler, who has spearheaded many of the increased regulatory efforts at the Commission and encouraged the PCAOB to update its older standards and take a tougher stance on enforcement and inspections. President-elect Trump, in contrast, has promised to eliminate regulations, and Gensler’s push for increased regulation has attracted the ire of many in the financial industry.

According to a person familiar with the PCAOB process, no further action is expected until further consultation with the SEC under the incoming administration can take place. 

Questions have arisen over whether the PCAOB might decide to repropose the standard with modifications given the amount of opposition it has attracted. That is to be determined pending review of the comment letters that have been received, as well as a roundtable from earlier this year, along with responses from targeted inquiries from firms in their approach relating to NOCLAR. 

PCAOB board members Christina Ho and George Botic were asked about the NOCLAR proposal on Wednesday at Financial Executives International’s Current Financial Reporting Insights Conference, and Ho acknowledged the pushback. 

“We’ve heard strong opposition from the auditing profession, public companies, audit committees, investors, academics and others,” said Ho. “The PCAOB has received 189 individualized comments to date on that proposal. This proposal now has the third highest number of comment letters in the history of PCAOB. That did get a lot of attention. Commenters overwhelmingly called for a reproposal or withdrawal of the proposed standard so that that is definitely something that I am looking at a lot, and I also voted against the proposal. I have spoken to various stakeholders, including investors, audit committee chairs and members, and some preparers as well. The question I got asked repeatedly was, what problem is PCAOB trying to solve? And the people I spoke to believe that there have been improvements in financial reporting quality over the past 20 years, and that obviously is consistent with the CAQ study noting a consistent decline in restatements. While there’s always room for improvement, they noted that a balance is necessary between increased investor protection and increased auditor implementation costs that are ultimately passed on to issuers, and that the NOCLAR proposal lacks such a balance. That is what I have heard from the comment letters, so that pretty much summarizes what I have seen, and I’m still obviously thinking about it.”

Botic noted that the proposal came before he joined the board, but he referred to the staff guidance that had been issued earlier in the week by the PCAOB on the existing requirements.

Last week, the PCAOB updated its standard-setting and rulemaking agendas before the outcome of the election was known. Now with the uncertainty over the regulatory environment, the PCAOB is mindful of the difficulty of having the SEC decide on whether to approve it, especially if the five-member commission becomes evenly split among two Republican members and the two Democrats if Gensler departs or is ousted. The PCAOB feels the SEC needs adequate time to review and educate itself on the proposed standard, rather than having to jam it through a two-two commission, especially with the amount of engagement that will need to take place given such an important standard, according to a person familiar with the matter.

The PCAOB expects it to remain on the docket for 2025 but doesn’t want to try to jam it through this year. However, the PCAOB announced Friday that it has scheduled an open board meeting next Thursday, Nov. 21, on another proposed standard on firm and engagement metrics, which has also provoked pushback from many commenters, but is still slated to be finalized this year.