IRS Delays Applicability of Proposed Section 382 Regulations
The IRS has issued new proposed regulations (REG-125710-18) that delay the applicability date of the September 2019 proposed Section 382 loss limitation rules. (Section references are to the Internal Revenue Code of 1986, as amended.) The new proposed regulations also provide transition relief and withdraw a portion of the September 2019 proposed regulations (see our prior coverage here). To address the concerns expressed about the September 2019 proposed regulations, the IRS has withdrawn the text of Proposed Regulations Sections 1.382-2(b)(4) and 1.382-7(g) as it appeared in the September 2019 proposed regulations and has proposed new text that (a) modifies the applicability date of the September 2019 proposed regulations, and (b) provides transition relief. Generally, the new text provides that the applicability date of the final regulations will be 30 days after the date the September 2019 proposed regulations are published as final (delayed applicability date). The IRS plans to finalize Proposed Regulation Section 1.382-7(d)(5) before the rest of the September 2019 proposed regulations as part of the final Section 163(j) regulations, and taxpayers will be permitted to apply that rule to prior periods. Proposed Regulation Section 1.382-7(d)(5), one of the September 2019 proposed regulations, would eliminate the possible duplicate application of Section 382 to certain disallowed business interest expense carryforwards.
IRS Issues Updated Form 1042-S Instructions
The IRS issued updated the Form 1042-S instructions to reflect changes made by proposed regulations issued in December 2018.
IRS Issues Guidance to Charities on Donations of Virtual Currency
The IRS has added two frequently asked questions (FAQs) to its virtual currency FAQ webpage that provide guidance to charities that receive donations of virtual currency.
New Jersey Enacts Alternative Pass-Through Tax
New Jersey has enacted legislation that creates an alternative pass-through tax. The legislation permits taxpayers to elect to have tax imposed on the pass-through entity rather than on the partner, member or shareholder.
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