IRS Tax: IRS announces 2009-2010 priority guidance projects

The Internal Revenue Service on November 24 released its long-delayed annual Priority Guidance Plan listing the 315 projects it expects to complete between July 2009 and June 2010. Projects in this year's plan – the first under the Obama administration – cover a wide range of areas including recent legislation, the current economic environment, and international issues.


Notable projects include:

Consolidated returns
- Regulations on the application of the corporate equity reduction interest loss rules under section 172(h) to a consolidated group;
- Regulations on allocation of tax benefits under section 1561; and
- Guidance on the consolidated return aspects of the election to defer recognition of cancellation of indebtedness income (COI) under section 108(i).

Corporations
- Regulations on the continuity of interest requirement for tax-free reorganizations;
- Guidance on all cash "D" reorganizations;
- Guidance under section 362(e) on the importation or duplication of losses;
- Regulations on transactions involving the transfer or receipt of no net equity value;
- Guidance on the effects of fluctuations in the relative values of different classes of stock on the determination of ownership changes;
- Guidance on the estimation of stock basis in certain nonrecognition stock-for-stock exchanges; and
- Guidance on the application of section 108(i) COI income deferral to corporations.

Employee benefits
- Guidance on various international tax issues related to tax-favored retirement plans;
- Guidance on the definition of readily tradable securities for ESOPs;
- Final regulations on the diversification requirements under section 401(a)(35);
- Final regulations on the suspension or reduction of safe harbor nonelective contributions under section 401(k) and m);
- Guidance on section 403(b) plan terminations;
- Final regulations on cafeteria plans under section 125;
- Final regulations under section 274(i) on qualified nonpersonal-use vehicles; and
- Final regulations on income inclusion under section 409A.

International issues
- Regulations under section 954 and other guidance under subpart F;
- Guidance relating to tiered investments and other guidance relating to passive foreign investment companies;
- Guidance under section 1441 on qualified intermediaries and other withholding issues;
- Guidance under section 367, including guidance on repatriation transactions;
- Guidance on issues relating to the foreign tax credit, such as treatment of foreign and domestic losses, the computation of earnings and profits, and final regulations under section 905(c) regarding foreign tax redeterminations;
- Transfer pricing guidance under section 482, including regulations on global dealing; and
- Regulations or other guidance on source, such as income from mixed sources and final regulations for sourcing certain services compensation on an event basis.

There are also a significant number of projects related to federal tax accounting and general tax administration.