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05 March 2026

IRS proposes removing final regulations on partnership related-party basis adjustment transactions

The IRS on March 5, 2026, issued proposed regulations (REG-108921-25) that would remove regulations that identify certain partnership related-party basis adjustment transactions as transactions of interest under Treas. Reg. Section 1.6011-18, which must be reported by taxpayers and material advisors (see Tax Alert 2025-0360). The proposed removal would be retroactively effective to January 14, 2025, the date the TOI regulations became effective. Treasury and the IRS had announced in Notice 2025-23 on April 17, 2025, that they intended to withdraw the final regulations and would not impose penalties for failure to report the transactions on Form 8886, Reportable Transaction Disclosure Statement, and Form 8918, Material Advisor Disclosure Statement, retroactive to January 14, 2025 (see Tax Alert 2025-0957). A Tax Alert is forthcoming.

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Published by NTD’s Tax Technical Knowledge Services group; Chris DeZinno, legal editor

Document ID: 2026-0576

 

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