In Notice 2026-7, the IRS outlined additional interim guidance on the corporate alternative minimum tax (CAMT) and modified certain provisions of the previously issued interim CAMT guidance.  Notice 2026-7 would allow taxpayers to adjust applicable financial statement income (AFSI) for certain domestic research amortization claimed in tax years beginning after December 31, 2024. It also would modify previous CAMT guidance to allow all taxpayers (regardless of industry) to make AFSI adjustments for deductible tax repairs related to IRC Section 168 property and amortization under IRC Section 197 attributable to goodwill and certain other intangibles (regardless of their acquisition date).  Additionally, Notice 2026-7 would allow AFSI adjustments for qualified production costs under IRC Section 181 and certain materials and supplies that are deducted for regular tax purposes but depreciated for financial reporting purposes.

Notice 2026-7 modifies the guidance in Section 4 of Notice 2025-46 for financially troubled companies and would modify the anti-avoidance rules in Prop. Reg. Section 1.56A-4 (regarding certain foreign transactions). It also provides guidance on the CAMT consequences of transactions involving intangible property subject to IRC Section 367(d).

The forthcoming CAMT proposed regulations are anticipated to include proposed rules consistent with the interim guidance in Notice 2026-7.  Subject to certain exceptions and special rules, taxpayers may generally rely on the guidance in Notice 2026-7 for tax years beginning before the proposed regulations are published in the Federal Register.

A Tax Alert is forthcoming.