The IRS yesterday announced:
• IRS Tightens Position on Abusive Tax Shelter Settlement Terms (IR-2004-128):

Under the new guidelines, the IRS will not settle unless taxpayers concede 100% of the claimed losses or deductions, reduced by only the amount of transaction costs up to 10% of the claimed losses or deductions. Furthermore, taxpayers must concede 50% of the accuracy-related penalty at issue. If both the 40% gross valuation misstatement penalty and the 20% substantial understatement penalty were asserted, then the settlement will apply to the gross valuation misstatement penalty. To settle these cases, taxpayers must enter into a closing agreement with the IRS. IRS agents will be able to accept these proposed agreements if they conform to the revised settlement guidelines issued by Appeals.

• IRS Announces Pension Plan Limitations for 2005 (IR-2004-127)

• 401(k)s, 403(b)(7)s, etc: Annual contribution limit: $14,000 ($13,000 in 2004)
• Maximum annual benefits: $170,000 ($165,000 in 2004)