Treasury, IRS issue interim guidance on new corporate alternative minimum tax
【《We Chinese in America》Media Editor Tang Zhao, December 28, 2022】As a valuable service to We Chinese in America website readers, We Chinese in America website posts English and Chinese versions of “IRS News Release” and “IRS Fact Sheets” directly received from IRS Media Relations Office in Washington, D.C.. We are pleased to take on this important role partnering with IRS to better inform the public.
Treasury, IRS issue interim guidance on new corporate alternative minimum tax
IR-2022-229, Dec. 27, 2022
WASHINGTON — The Treasury Department and the Internal Revenue Service today issued Notice 2023-7, which provides interim guidance regarding the application of the new corporate alternative minimum tax (CAMT) until the issuance of proposed regulations.
The Inflation Reduction Act created the CAMT, which imposes a 15% minimum tax on the adjusted financial statement income of large corporations for taxable years beginning after December 31, 2022. The CAMT generally applies to large corporations with average annual financial statement income exceeding $1 billion. The Treasury Department and the IRS have issued Notice 2023-7 to provide certainty to taxpayers in advance of the CAMT effective date.
In particular, Notice 2023-7 clarifies which corporations the CAMT applies to and how the alternative minimum tax is calculated. It also provides taxpayers with answers to basic questions about how certain transactions may be treated and certain adjustments that may be taken into account for purposes of the alternative minimum tax, including adjustments for depreciation and certain tax credits. Critically, it also gives smaller corporations an easy method for determining that the new alternative minimum tax does not apply to them.
Notice 2023-7 also solicits comments on the rules contained in the notice and certain other issues under consideration. The Treasury Department and the IRS recommend that such comments be submitted within 60 days after the date on which Notice 2023-7 is published in the Internal Revenue Bulletin.
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