The IRS today released an advance version of Rev. Proc. 2020-50 as guidance for taxpayers that want to apply Reg. sections 1.168(k)-2 and 1.1502-68, or to rely on 2019 proposed regulations under section 168(k) for:
Read Rev. Proc.2020-50 [PDF 198 KB] (56 pages)
Today’s revenue procedure allows a taxpayer to make a late election—or to revoke an election—for the tax year ending on or after September 28, 2017.
Specifically, Rev. Proc. 2020-50 provides that if the taxpayer retroactively applies Reg. sections 1.168(k)-2 and 1.1502-68, or relies on the 2019 proposed regulations:
The Treasury Department and IRS yesterday afternoon released for publication in the Federal Register final regulations adopting the 2019 proposed regulations (but with certain modifications). Read TaxNewsFlash
For example, modifications made by the 2020 final regulations in adopting the 2019 proposed regulations concern the rules regarding:
The 2020 final regulations also do not retain the rules regarding a partner’s prior depreciable interest in property held by a partnership. Under a separate notice of withdrawal of proposed regulations, these rules will be withdrawn effective January 11, 2021.
The rules in the 2020 final regulations regarding whether the taxpayer or a predecessor previously had a depreciable interest in property acquired by a consolidated group have been moved from Reg. section 1.168(k)-2 to Reg. section 1.1502-68.
The 2020 final regulations also reflect other modifications to the 2019 final regulations. For example, the 2020 final regulations:
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