Government Indicates Priorities for TCJA Guidance

The IRS has begun setting out priorities for guidance on provisions in the Tax Cuts and Jobs Act Guidance per a story posted today by Tax Analysts in Tax Notes Today[1].  The story was reporting on comments by Clifford Warren, special counsel to the IRS associate chief counsel (passthroughs and special industries) and Bryan Rimmke, attorney-adviser, Treasury Office of Tax Policy, given to the New York State Bar Association Tax Section annual meeting on January 23.

The IRS is moving first to deal with the guidance needed on the deemed repatriation provisions of the Tax Cuts and Jobs Act, having already released some guidance in this area.  As well, emergency guidance was issued in the form of Notice 2018-8, giving temporary relief for publicly traded partnerships from the special withholding rules imposed on buyers of certain partnership interests for interests purchased from foreign partners found in newly enacted IRC §§864(c)(8) and 1446(f).

The government representatives stated IRS is prioritizing guidance in two specific areas:

  • Section 199A Qualified Business Income Deduction
  • Section 163(j) Limits on the Deduction of Certain Business Interest.

A secondary priority is guidance on the provisions related to expanded bonus depreciation under IRC §168(k).

A much lower priority is guidance on the carried interest provisions of IRC §1061, noting that this provision affects far fewer taxpayers than the three provisions mentioned earlier.

Mr. Rimmke noted that a major area the IRS will be looking at in Section 199A will relate to how much of services that might appear to “specified services” will taint an otherwise qualified trade or business.

The government representatives also noted the guidance project for the business interest limitation planned to look the complexity of dealing with the interest limits determined at the partnership level.

[1] Emily Foster, “Tax Bill Triage Not Complete But Guidance Priorities Emerging,” Tax Notes Today, January 24, 2018, 2018 TNT 16-2