US Treasury and the IRS on August 27, published Final Regulations and 2020 Proposed Regulations under Section 245A, as enacted by the 2017 tax reform legislation (the Act), and Sections 954 and 6038. On June 18, 2019, Treasury and the IRS had published temporary regulations (2019 Temporary Regulations) and cross-referenced the proposed regulations under Sections 245A, 954, and 6038 (2019 Proposed Regulations). As of August 27, 2020, the 2019 Proposed Regulations are finalized, and the 2019 Temporary Regulations have been removed.
The Final Regulations provide clarifications of and revisions to certain rules in the 2019 Temporary and 2019 Proposed Regulations. For those taxpayers subject to the ED rules, the 2020 Proposed Regulations should be evaluated in detail to determine whether any potential reductions to ED accounts or disqualified basis in specified property may be available.