President Joe Biden signed the Inflation Reduction Act (IRA) into law on August 16. As TEI members know, the IRA included two major “revenue raisers” of importance to the business tax community.
First, a new corporate alternative minimum tax (CAMT) imposing a fifteen percent tax on the “adjusted financial statement income” of “applicable corporations.” Second, a one percent excise tax on the fair market value net share repurchases by covered corporations. Both provisions are effective for taxable years beginning after December 31.
TEI filed comments about the CAMT on October 18. TEI’s CAMT comments addressed 1) transition rules for pre-CAMT items affecting post-CAMT years; 2) treatment of items subject to mark-to-market accounting for financial statement purposes but not for tax purposes; 3) relief from interest and penalties for post-CAMT effective date estimated tax payments; 4) the Section 243 dividends received deduction; 5) application of the CAMT to non-US businesses operating in the United States; and 6) treatment of financial statement consolidating entries when calculated adjusted financial statement income.
Drafting of TEI’s comments was led by the Tax Reform Task Force, chaired by Jason Weinstein of Amazon. Ben Shreck, TEI tax counsel, supported this initiative from the TEI staff. To get involved in TEI’s Tax Reform Task Force, please contact Shreck at firstname.lastname@example.org.