IRS Sending Letters to Taxpayers Concerning Action Required for QOF Claims
The Internal Revenue Service (IRS) today announced that it is sending letters to inform taxpayers that they may need to take additional actions related to qualified opportunity funds (QOFs). The IRS said that taxpayers who attached a Form 8996 to a tax return or indicated that they did so may receive a letter that indicates that if they intend to self-certify as a QOF, they may need to take additional action. Those taxpayers should file an amended return or an administrative adjustment request (AAR). Other taxpayers may be notified that they may not have properly followed the instructions for Form 8949, Sales and Other Dispositions of Capital Assets or that they lack a gain that would make them eligible. Those taxpayers can also file an amended return or an AAR. The IRS said failure to act may result in their tax accounts being referred for examination and the possibility of taxes, interest and penalties on gains that were not properly deferred.