The Treasury Department has identified eight recent regulations for re-evaluation under Executive Order (EO) 13789, Identifying and Reducing Tax Regulatory Burdens. Treasury reported that it would propose reforms to these regs, which could include repeal, in a final report to the White House later this year.

"The notice reflects the list of major regulatory projects with which the general business communities was at odds, such as the final regulations under Section 385, as well as an under-the-radar project, like the final regulations under Section 7602. Notably, Treasury acknowledges that the IRS did not overstep its regulatory authority on any of these eight regulatory projects, and rather, the regulations were chosen because they either impose an undue financial burden on U.S. taxpayers or an undue complexity to the tax law," Shamik Trivedi, Manager, Washington National Tax Office, Grant Thornton LLP, told Wolters Kluwer.

Treasury's roster includes Proposed Regulations under Section 103 on Definition of Political Subdivision (REG-129067-15). "This proposed regulation attempts to jettison long-standing guidance from 1944 and put in its place a new arbitrary standard for determining what entities can issue tax-exempt bonds for public infrastructure. The proposed changes are very disruptive to the market and have the potential to raise the costs of financing infrastructure at a critical time," Linda Schakel, Partner, Ballard Spahr LLP, Washington, D.C., told Wolters Kluwer.

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