Stock Buyback Tax Rules Proposed by Treasury Department (2)

The Treasury Department has proposed regulations on how the new stock-buyback tax will be imposed and administered.

Treasury issued the proposed rules (REG-115710-22, RIN 1545-BQ59 and REG-118499-23, RIN 1545-BQ60) Tuesday. They would formalize and enact the planned guidance that Treasury announced in December 2022 (Notice 2023-2) to implement the 1% excise tax on corporate stock repurchases, which was enacted as part of the so-called 2022 Inflation Reduction Act and took effect at the start of 2023.

The proposed rules detail what kinds of transactions are and aren’t subject to the new tax and give procedural guidance ...