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Effective for tax years beginning after 31 December 2022, the corporate alternative minimum tax (CAMT) generally applies to “applicable corporations” with average annual adjusted financial statement income (AFSI) that exceeds $1 billion.

The IRS and Treasury recently released Notice 2023-42 (Notice), waiving the addition to tax under Section 6655(a) relating to the CAMT for a tax year that begins after 31 December 2022, and before 1 January 2024 (Covered CAMT Year). According to the IRS, in the interest of sound tax administration the Notice provides relief in light of uncertainty regarding a corporation’s status as an applicable corporation subject to the CAMT and the computation of a corporation’s CAMT liability under Section 55.