The Treasury Department this morning released a report proposing the revocation or revision of eight significant Obama-era regulations. Among other proposals, the Treasury Department is considering revoking the “documentation rule” promulgated under Section 385 and the regulations changing the allocation of partnership liabilities for purposes of determining whether a disguised sale has occurred. The “bottom dollar” guarantee rules for partnership liabilities would be retained, however, as would the “per se” rule of the Section 385 regulations, at least for now, pending tax reform. Additional proposals include providing an exception to the new Section 367 regulations for transfers of foreign goodwill and going concern value in situations unlikely to be abusive and providing additional time and flexibility for the implementation of new rules under Section 987. Continue Reading
President-elect Trump and Congressional Republicans have pledged to aggressively roll back regulations issued by the Obama Administration, including tax rules. In this post, we consider the paths Republicans might take in pursuing their agenda. In general, alternatives for repeal will depend on how recently rules were issued and whether such rules are regulations or less formal guidance.
Final regulations not yet published in Federal Register. Final regulations do not become effective until they are published in the Federal Register, and publication typically does not occur until weeks after regulations are approved by the relevant agency. Shortly after assuming office, an incoming President typically issues an executive order suspending all unpublished final regulations for review by the new administration. Continue Reading
Tax reform will be one of the top priorities for the 115th Congress. Hopes for pursuing tax reform to a successful conclusion are high, given one-party control of the government (and exuberant campaign promises). Following the 2016 election, Davis Polk laid out the background and context in which tax reform measures will be considered, with links to summaries of the leading proposals and details on the politics of tax reform. Although life in Washington has moved forward since this memo was published, the key points and players remain the same. Read on for things to watch.