Treasury Rolls Back Eight Tax Regulations

Treasury Department, Second Report to the President on Identifying and Reducing Tax Regulatory Burdens (Executive Order 13789) (Oct. 2, 2017) (press release):

This Second Report recommends actions to eliminate, and in other cases mitigate, consistent with law, the burdens imposed on taxpayers by eight regulations that the Department of the Treasury (Treasury) has identified for review under Executive Order 13789. As stated in the order, it is the policy of the President that tax regulations provide clarity and useful guidance. Recent regulations, however, have increased tax burdens and impeded economic growth. The order therefore calls for immediate action to reduce tax regulatory burdens and provide useful and simplified tax guidance.

The order directed the Secretary of the Treasury to identify significant tax regulations issued on or after January 1, 2016, that (i) impose an undue financial burden on U.S. taxpayers, (ii) add undue complexity to the Federal tax laws, or (iii) exceed the statutory authority of the Internal Revenue Service (IRS). In an interim Report to the President dated June 22, 2017 (the “June 22 Report”), Treasury identified eight such regulations. Executive Order 13789 further directs the Secretary to submit to the President a report recommending “specific actions to mitigate the burden imposed by regulations identified in the interim report.”

This Second Report sets forth the Secretary’s recommendations. Treasury expects to issue additional reports on reducing tax regulatory burdens, including, as directed in the order, the status of Treasury’s actions recommended in this Second Report. ...

Proposed Regulations to be Withdrawn Entirely
1. Proposed Regulations under Section 2704 on Restrictions on Liquidation of an Interest for Estate, Gift and Generation-Skipping Transfer Taxes
2. Proposed Regulations under Section 103 on Definition of Political Subdivision

Regulations to Consider Revoking in Part
3. Final Regulations under Section 7602 on the Participation of a Person Described in Section 6103(n) in a Summons Interview
4. Regulations under Section 707 and Section 752 on Treatment of Partnership Liabilities
5. Final and Temporary Regulations under Section 385 on the Treatment of Certain Interests in Corporations as Stock or Indebtedness

Regulations to Consider Substantially Revising
6. Final Regulations under Section 367 on the Treatment of Certain Transfers of Property to Foreign Corporations
7. Temporary Regulations under Section 337(d) on Certain Transfers of Property to Regulated Investment Companies (RICs) and Real Estate Investment Trusts (REITs)
8. Final Regulations under Section 987 on Income and Currency Gain or Loss With Respect to a Section 987 Qualified Business Unit

• Accounting Today, Treasury Rolls Back Some Tax Regulations
• Forbes, Treasury To Withdraw Hated Estate Tax Valuation Rules
• The Hill, Treasury to Withdraw Proposed Estate Tax Rules
• Wall Street Journal, U.S. Treasury to Withdraw Proposed Tax Rules on ‘Valuation Discounts’
• Washington Examiner, Treasury Moves to Undo Obama Tax Rules, Including Anti-Inversions Regulation