The proposed regulations for the stock repurchase excise tax have been analyzed by KPMG. The report provides an overview of the regulations and their potential impact on companies. It also highlights key considerations for companies to keep in mind when planning for stock repurchases.
The U.S. Treasury Department and IRS on April 9, 2024, released two sets of proposed regulations (REG-115710-22 and REG-118499-23) addressing the non-deductible 1% excise tax on repurchases of corporate stock under section 4501. The proposed regulations largely follow the approach of Notice 2023-2, which provided initial guidance regarding the application of the stock repurchase excise tax (read TaxNewsFlash), but the proposed regulations provide rules for the application of the excise tax to U.S. subsidiaries of publicly traded foreign corporate parents that differ from those contemplated by Notice 2023-2.
Read an April 2024 report prepared by KPMG LLP that provides initial analysis of the proposed regulations
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