IRS to Propose Reporting of Uncertain Tax Positions With Returns

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IRS Commissioner Shulman unveils a proposal for a tax schedule that would require large business taxpayers, for the first time, to proactively report their uncertain tax positions and the associated dollar amounts at the time they file their returns. Calling the proposal “a major step toward transparency,” Shulman says IRS is working on a schedule that taxpayers would be required to submit with their Forms 1120. IRS Announcement 2010-9 details plans for the new schedule. Reporting would be mandatory for those who have a financial statement prepared under FIN 48 or other similar accounting standards, reflecting uncertain tax positions, and assets over $10 million. Shulman stresses the government is looking only for a brief description of the issue and the maximum amount of U.S. tax exposure, and does not ask taxpayers to disclose how strong or weak they believe their positions are, or the amounts they reserved on the books for those positions.

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