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Stock buyback tax - Final procedural regulations released.

Published by Baker Tilly

The IRS finalized regulations on June 28, 2024, for reporting and paying the IRC section 4501 excise tax on repurchased corporate stock by publicly traded corporations. These regulations apply to returns required after June 28, 2024, for taxable years ending after that date. The final rules, largely adopting the proposed ones, clarify that returns should only be filed in years with taxable stock repurchases. They exempt Regulated Investment Companies (RICs) and Real Estate Investment Trusts (REITs) from filing but require recordkeeping. Returns must be filed with Form 720 and, where applicable, Form 7208 attached.

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