OMB’s Office of Information and Regulatory Affairs (OIRA) reported it has completed review of proposed regulations concerning the treatment of payments made to charitable entities in return for consideration, pursuant to provisions enacted by the 2017 U.S. tax law (Pub. L. No. 115-97) (the law that is commonly referred to as the “Tax Cuts and Jobs Act” (TCJA)).
According to OIRA, review of the following proposed regulations was completed on December 4, 2019.
The regulations are described by OIRA as follows:
The [proposed regulations provide] proposed amendments to the regulations under sections 162, 164, and 170. First, the proposed amendments provide safe harbors under section 162 for certain payments made by business entities to or for the use of an entity described in section 170(c) if the business entity receives, or expects to receive, a state or local tax credit in return. Second, the proposed amendments provide a safe harbor under section 164 for payments made to an entity described in section 170(c) by individuals who itemize deductions and receive or expect to receive a state or local tax credit in return. Third, the proposed amendments clarify the application of the quid pro quo principle under section 170 to benefits received or expected to be received by a donor from a third party.
Treasury regulations that are identified as “major” regulations are subject to review by OMB’s OIRA before being issued, pursuant to Executive Order 13771. Now that OIRA review has been completed, Treasury and the IRS can be expected to release these proposed regulations for publication in the Federal Register—the exact date of publication not being known.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.