Treasury Issues Guidance on Units’ Currency Gains and Losses (1)

The Treasury Department issued guidance for a key change in regulations on how companies’ subsidiaries treat foreign-currency gains and losses.

Treasury said in a notice (Notice 2026-17) Wednesday that it would propose regulations under Section 987 making the change. A Treasury official had indicated in January that the change was planned.

The forthcoming proposed rules are intended to reduce compliance burdens, simplify how the Section 987 rules operate, and refine certain rules’ scope to limit their effect on routine transactions, Treasury said.

The guidance would essentially allow “qualified business units” to go back to using an old method, ...