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December 29, 2022

BREAKING TAX NEWS | IRS issues interim guidance on application of the new corporate alternative minimum tax

The IRS has issued interim guidance (Notice 2023-7) addressing the application of the corporate alternative minimum tax (CAMT), enacted under the Inflation Reduction Act of 2022. Notice 2023-7 describes rules that the IRS intends to include in proposed regulations pertaining to: certain issues regarding IRC subchapters C and K; "troubled corporations"; groups of corporations that file consolidated returns; depreciation of IRC Section 168 property; and the treatment of certain federal income tax credits under the CAMT. Taxpayers may rely on the interim guidance pending the release of proposed regulations.

Additionally, Notice 2023-7 provides a simplified method for determining whether an entity constitutes an "applicable corporation" and notes that further interim guidance may be forthcoming and may be oriented toward particular industries encountering unintended adverse consequences under the CAMT. The IRS invites written comments on any (1) questions arising from Notice 2023-7 and (2) issues that should be addressed in future guidance, including which guidance “is needed most quickly.” Interested parties should submit written comments to the IRS electronically within 60 days after Notice 2023-7 is published in the Federal Register. A Tax Alert is forthcoming.

Published by NTD's Tax Technical Knowledge Services group; Carolyn Wright, legal editor