Even though a valid extension was filed timely, or returns that have been filed timely, IRS is sending FALSE CP 59 notices for the 2024 tax year. The IRS has acknowledged that mostly due to processing delays, the notices have been issued. Clients should check to make sure the extension, or a timely return has been filed. They can accomplish this by accessing their online account to confirm the extension or that the return has been filed.
Unfortunately, clients that disagree must respond with Form 15103 – Form 1040 Return Delinquency, and mail or fax or submit online. Part of the form is below. Responding promptly to avoid future confusion or penalties is necessary. CP 59 may only be a sign of delayed processing rather than an unfiled tax return.
These milestones come just two months after Commissioner Frank J. Bisignano was sworn in as SSA’s 18th Senate-confirmed leader, with a vision to transform the agency into a premier service organization. Since his appointment, Commissioner Bisignano has engaged directly with employees across the country to understand their challenges and drive immediate improvements.
SSA has faced significant challenges in recent years, including service backlogs, long wait times, and low employee morale. The agency has ranked last among large federal agencies in employee satisfaction for three consecutive years.
Under Commissioner Bisignano’s leadership, SSA is working to reverse this trend by equipping employees with the tools and resources they need to improve performance across all operations. Central to this transformation is SSA’s commitment to becoming a digital-first, technology-driven organization.
IRS released some preliminary guidance on July 15 concerning some of the new issues facing us from H.R.1 the One Big Beautiful Bill
Below are descriptions of new provisions from the One Big Beautiful Bill Act, signed into law on July 4, 2025, as Public Law 119-21, that go into effect for 2025.
New deduction: Effective for 2025 through 2028, individuals may deduct interest paid on a loan used to purchase a qualified vehicle, provided the vehicle is purchased for personal use and meets other eligibility criteria. (Lease payments do not qualify.)
- Maximum annual deduction is $10,000.
- Deduction phases out for taxpayers with modified adjusted gross income over $100,000 ($200,000 for joint filers).
Qualified interest: To qualify for the deduction, the interest must be paid on a loan that is:
- originated after December 31, 2024,
- used to purchase a vehicle, the original use of which starts with the taxpayer (used vehicles do not qualify),
- for a personal use vehicle (not for business or commercial use) and
- secured by a lien on the vehicle.
If a qualifying vehicle loan is later refinanced, interest paid on the refinanced amount is generally eligible for the deduction.
Qualified vehicle: A qualified vehicle is a car, minivan, van, SUV, pick-up truck or motorcycle, with a gross vehicle weight rating of less than 14,000 pounds, and that has undergone final assembly in the United States.
Taxpayer eligibility: Deduction is available for both itemizing and non-itemizing taxpayers.
- The taxpayer must include the Vehicle Identification Number (VIN) of the qualified vehicle on the tax return for any year in which the deduction is claimed.
Reporting: Lenders or other recipients of qualified interest must file information returns with the IRS and furnish statements to taxpayers showing the total amount of interest received during the taxable year.
Guidance: The IRS will provide transition relief for tax year 2025 for interest recipients subject to the new reporting requirements.
New deduction: Effective for 2025 through 2028, individuals who are age 65 and older may claim an additional deduction of $6,000. This new deduction is in addition to the current additional standard deduction for seniors under existing law.
- The $6,000 senior deduction is per eligible individual (i.e., $12,000 total for a married couple where both spouses qualify).
- Deduction phases out for taxpayers with modified adjusted gross income over $75,000 ($150,000 for joint filers).
Qualifying taxpayers: To qualify for the additional deduction, a taxpayer must attain age 65 on or before the last day of the taxable year.
Taxpayer eligibility: Deduction is available for both itemizing and non-itemizing taxpayers.
Taxpayers must:
- include the Social Security Number of the qualifying individual(s) on the return, and
- file jointly if married, to claim the deduction.
Issue 3 - New ID.me PTIN Registration Sign-In Process
Please note changes to PTIN Registration Sign-in Process
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Dear Tax Professional:
Why we're contacting you
We have updated the Tax Professional PTIN System sign-in process for tax return preparers who have a Social Security number (SSN).
- You will now sign in using ID.me, a technology provider that conducts identity verification and credential management for access to IRS online services.
- In the near future, the existing sign-in method of using a Username and Password will no longer be supported for tax return preparers with a SSN.
- You cannot access the Tax Professional PTIN System without an ID.me account.
- Tax preparers who do not have a SSN will continue using their current sign-in process.
Existing ID.me users
- If you have an ID.me account from a state government or another federal agency, you can sign in without re-verifying your identity.
- If you’re a new user, you will have to create a new ID.me account.
- Your ID.me credentials enable access to various IRS online services including the Tax Professional PTIN System, Tax Pro Account, Business Tax Account, Individual Online Account, and more.
New ID.me users
- Users who don’t currently have an account will be required to create one with ID.me to access the PTIN Online Registration System.
- To create a new ID.me account for access to the Tax Professional PTIN System, users will need a government-issued photo ID, an email address, and a camera enabled computer or mobile device.
- ID.me offers multiple registration options and 24/7 customer assistance.
More information
Additional information can be found by visiting the following resources:
Sincerely,  Kimberly D. Rogers
Director, Return Preparer Office
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Issue 4 - IRS Asked to Explore Direct File Alternatives
The tax bill known as One Big Beautiful Bill Act, recently signed into law by President Trump, appropriates $15 million to the Treasury Department to deliver a report to Congress on the cost and feasibility of a new free direct e-file tax return system.
§ 70607 📌 of the legislation calls for the creation of a task force on the replacement of the IRS’s Direct File program to provide information on:
- The cost of establishing public-private partnerships providing free tax filing for up to 70% of taxpayers, and to replace any direct e-file programs run by the IRS.
- Taxpayer opinions and preferences regarding a taxpayer-funded, government-run service or free service provided by the private sector.
- Assess the feasibility of a new approach that provides consistent, simple options for taxpayers and addresses taxpayer needs.
- The cost of developing and running a free direct e-file tax return system.
The IRS will end its
Direct File 📌 free e-filing program Oct. 15. It was only available to taxpayers nationwide for the 2025 filing season.
Issue 5 - Electronic Tax Administration Advisory Committee issues 2025 Annual report
The IRS Electronic Tax Administration Advisory Committee released its
2025 Annual Report 📌 with recommendations to Congress and the IRS.
Recommendations for the IRS are to update tax return forms to enhance security and combat fraud and identity theft, review and update the current list of Modernized e-File reject codes and explanations, promote greater information sharing between the IRS, states and industry partners, and build on current IRS efforts to transition taxpayers to digital interactions.
The Committee is also requesting that Congress consider tax simplification when implementing tax policy goals, authority for the IRS to regulate non-credentialed tax return preparers, predictable funding of the IRS for efficient and effective taxpayer service and prioritizing continued technology modernization enhancements.
Issue 6 - Filing Information Returns Electronically (FIRE) System Target Retirement Date
Tax Year 2026/Filing Season 2027 is the target date for the retirement of the Filing Information Returns Electronic (FIRE) system. FIRE will not be available for submissions in Filing Season 2027. The Information Returns Intake System (IRIS) will be the only intake system for information returns currently received through FIRE.
IRS encourages practitioners to complete the IRIS Application for TCC and begin transitioning to IRIS to ensure you are ready for the 2027 filing season.
IRIS Working Group meetings are held the second Wednesday of every month. Attendees must register each month to receive the meeting link. Working group notifications are sent out to subscribers of Information Returns Intake System (IRIS) QuickAlerts. Attendees can also complete the registration on the
IRIS working group meetings and notes page 📌 located on irs.gov/IRIS.
Issue 7 - IRS Allows Churches to Endorse Candidates
The IRS will now allow houses of worship to endorse or oppose political candidates without endangering their status as tax-exempt nonprofits. The agency said in a court filing that traditional religious communications are exempt from the Johnson Amendment, which was added to the U.S. tax code in 1954 to bar 501(c)(3) organizations from endorsing or opposing candidates.
The court filing resolved a lawsuit brought by the National Religious Broadcasters Association and two Texas churches, which claimed the Johnson Amendment violated their First Amendment rights.
Issue 8 - Funding for Tax Aide Program
This was a question asked from one of our webinars. A Grant notice was posted as of May 1, 2025, for the 2026 tax season. Applications closed on May 31, 2025. Estimated funding was listed as $30,000,000.
Issue 9 - EA Letters Concerning Renewal Out to Certain Tax Professionals – Applies to EA with the last digits in their Social Security Number are – 4,5,6.
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Dear Enrolled Agent,
Your renewal application will be due by January 31, 2026. Please be advised that we will begin accepting Enrolled Agent renewal applications in October, one month earlier than previous years.
Processing of your renewal application may be delayed if you have insufficient continuing education (CE) or incomplete documentation of valid CE. To ensure timely processing of your renewal application, please check your online PTIN account ( IRS.gov/ptin) 📌 to verify that all CE hours are accurately reported. Continuing Education Requirements:
- Obtain 72 hours (66 hours tax-related CE and 6 hours ethics) every three years, based on your renewal cycle.
- EXCEPTION: If this is your first renewal, you must complete 2 hours of tax-related CE for each month of your enrollment, including 2 hours of ethics each year.
- Obtain a minimum of 16 hours per year (2 of which must be ethics)
- CE hours from courses that were taken before you became an Enrolled Agent are not applicable.
- Excess hours in ethics cannot be applied toward your federal tax/federal tax law CE requirement.
- CE must be obtained through an IRS-approved continuing education provider. 📌 {Basics & Beyond listed on pg. 4}
If you have completed IRS-approved courses that are not posted on your IRS PTIN account, contact your CE provider for assistance.
Additional information:
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Issue 10 - IRS Forms 709 and 709-NA Now Electronic
Individuals may now electronically file Forms 709, United States Gift (and Generation-Skipping Transfer) Tax Return, and 709-NA, United States Gift (and Generation-Skipping Transfer) Tax Return of Nonresident Not a Citizen of the United States. Specific exclusion amounts for the current year and instructions can be found on IRS.gov.
Issue 11 - Snapshot Report: IRS Workforce Reductions as of May 2025 July 18, 2025, Report Number: 2025-IE-R027
As part of its efforts to reduce the size of the federal government’s workforce, the IRS offered deferred resignation programs (DRP). These programs allowed federal employees to resign with pay through September 30, 2025, or later, if the employee’s retirement date was between October 1 and December 31, 2025
The IRS also offered Voluntary Early Retirement Authority (VERA) and Voluntary Separation Incentive Payment (VSIP) to encourage employees to leave federal service
Additionally, in April 2025, the IRS began Reduction in Force (RIF) actions to further reduce its workforce. TIGTA initiated this review to provide an update to our previous report on the IRS’s efforts to reduce its workforce. This report provides a snapshot of IRS business units and positions impacted, as of May 2025.
- According to IRS records, 25,386 employees separated, took a DRP offer, or used some other incentive to leave
- Another 294 employees were sent termination notices due to RIF actions.
These departures represent 25 % of the IRS’s workforce and impact certain business units more than others. Additionally, the separations impacts employees in certain positions (e.g., job series).
For example, approximately 27% of tax examiners separated, while 26 % of revenue agents separated. Tax examiners are responsible for reviewing and processing federal tax returns to ensure compliance and accuracy. Revenue agents conduct examinations (audits) by reviewing financial records of individuals and businesses to verify what is reported.
Deferred Resignation Program (DRP) – 4,575 employees
Treasury Deferred Resignation Program (TDRP) – 17,071 employees
Voluntary Separation Incentive Payment (VSIP) – 776 employees
Other Separations – 3,093 employees
Issue 12 - People Paying Disability-Related Expenses Consider an ABLE Savings Account and Saver’s Credit
People with disabilities and their families can use
Achieving a Better Life Experience accounts 📌 to help pay for qualified disability-related expenses. ABLE accounts are savings accounts that don't affect eligibility for government assistance programs. Here are some key things people should know about these accounts.
Contribution limits
The contribution limit for 2025 is $19,000. Certain employed ABLE account beneficiaries may make an additional contribution. The additional amount is the designated beneficiary's compensation for the tax year or, for 2025, the amount of $15,650 for residents in the continental U.S., $19,550 in Alaska and $17,990 in Hawaii.
Saver's Credit
ABLE account designated beneficiaries may be eligible to claim the
Saver's Credit 📌 for a percentage of their contributions. This is a non-refundable credit for people who meet all the following criteria:
- Are at least 18 years old at the close of the taxable year
- Are not a dependent or a full-time student
- Meet the income requirements.
Rollovers and transfers from Section 529 plans
Families may roll over funds from a 529 plan to another family member's ABLE account. The ABLE account must be for the same beneficiary as the 529 account or for a member of the same family as the 529 account holder. Rollovers from a Section 529 plan do count toward the annual contribution limit.
Rollovers from a 529 to an ABLE account, plus the annual contribution to the ABLE account, cannot exceed the maximum contribution amount for the year. For example, the $18,000 annual contribution limit for 2024 would be met by parents contributing $10,000 to their child's ABLE account and rolling over $8,000 from a 529 plan to the same ABLE account.
Qualified disability expenses
States can offer ABLE accounts to help people who become disabled before age 26 or if their families pay for disability-related expenses outlined in
Publication 907, Tax Highlights for Persons with Disabilities. 📌 Though contributions aren't deductible for federal tax purposes, distributions – including earnings – are tax-free to the beneficiary if the taxpayer pays for a qualified disability expense.
Issue 13 - The IRS Transferred Incorrect Federal Tax Information to the Department of Education for Federal Student Aid June 30, 2025, Report Number: 2025-2S0-029
TIGTA determined that 7.2 million FAFSA Form requests were potentially affected by the incorrect FTI.
In December 2019, the Fostering Undergraduate Talent by Unlocking Resources for Education (FUTURE) Act was signed into law, which amended the Internal Revenue Code to allow the IRS to disclose certain Federal Tax Information (FTI) to the Department of Education
The law streamlined the Free Application for Federal Student Aid (FAFSA) application process for students, parents, and borrowers by enabling them to request that the IRS disclose their tax information to the Department of Education when applying for federal student aid.
In April 2024, the Department of Education publicly announced the IRS was transferring incorrect taxpayer data to the FAFSA application system. This project was initiated to assess the IRS’s processes and procedures for disclosing taxpayer data to the Department of Education. Impact on Tax Administration.
The IRS’s data repositories are complex and contain sensitive taxpayer data that must be secure. This environment poses unique challenges when establishing accurate and secure data sharing agreements. The inaccurate data exchange to the Department of Education represented a fraction of taxpayers and was limited to tax information for education. A recent Executive Order aims to remove barriers and promote inter‑agency data sharing.
However, not every FAFSA Form request received by the IRS resulted in a federal student aid determination being reprocessed by the Department of Education.
When the Department of Education notified the IRS of the discrepancies, it requested that the IRS validate the FA-DDX data elements for FAFSA Form requests. The IRS confirmed that it transferred incorrect FTI for the education credit data element. For the remaining data elements, and according to the IRS, it confirmed that the FA-DDX system was programmed in accordance with its agreement with the Department of Education.
IRS document standards require that data specifications be created for data structures. Data structures consist of all files, records, groups, and items used by a system. These data details must be defined in a data dictionary. We determined that the IRS does not have a data dictionary for these data sources.
Without a reliable data dictionary, the IRS cannot ensure that programming errors are avoided. Considering increased efforts to promote inter-agency data sharing and the IRS’s current initiative to develop a unified application programming interface, we plan to continue performing reviews in these areas since they could have potentially profound consequences.
Issue 14 - Applicable Federal Rates for August 2025, Rev. Rul. 2025-14
REV. RUL. 2025-14 TABLE 5
Rate Under Section 7520 for August 2025 Applicable federal rate for determining the present value of an annuity, an interest for life or a term of years, or a remainder or reversionary interest 4.80%
FAQs - Frequently Asked Questions
Q1: What are CP59 notices and why are they being sent in error?
Q2: How do tax professionals register with the IRS now that ID.me is required?
ID.me is now the only supported method for PTIN sign-in. The prior Username/Password system will be phased out.
See Issue 3. 📌
Q3: What new deductions are available under the One Big Beautiful Bill?
Deductions include those for tips, overtime, car loan interest, and an additional deduction for seniors.
See Issue 2. 📌
Q4: When is the IRS Direct File program ending?
The Direct File program will sunset on October 15, 2025, with a task force evaluating future alternatives.
See Issue 4. 📌
Q5: What improvements has Social Security made to customer service?
The SSA reduced phone wait times, processed payments early, and launched a 24/7 online portal.
See Issue 1. 📌
