ABA Banking Journal
No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
SUBSCRIBE
ABA Banking Journal
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
No Result
View All Result
No Result
View All Result
ADVERTISEMENT
Home Newsbytes

Treasury Issues Controversial ‘Interest Stripping’ Final Rule

October 14, 2016
Reading Time: 2 mins read

In response to comments from American Bankers Association and other groups, banks scored a win yesterday when the Treasury Department issued a revised final rule to address alleged “interest stripping” that carved out debt instruments issued by most financial institutions from an important portion of the rule. The Treasury proposal was targeted at transactions that use inter-affiliate debt to take deductions in a higher-tax jurisdiction and receive the income in a no- or low-tax jurisdiction, but ABA noted that it was far broader than headlines implied, with implications for ordinary operations of banks of all sizes.

In response to comments from ABA and others about the comprehensive regulatory and audit regime to which banks are subject, Treasury carved out an exception to the rule for debt instruments issued by an “excepted regulated financial company,” including insured depository institutions, bank holding companies and certain savings and loan holding companies. Treasury did not lift documentation requirements for regulated entities, but S corporations are exempt from all aspects of the final rule.

ABA’s request for a less punitive approach to documentation errors was acknowledged. Documentation under the final rule is treated as timely so long as it is prepared by the time the filer’s federal income tax return is filed. The final rule also provides a rebuttable presumption for documentation errors provided that covered entities are otherwise in compliance, instead of per se re-characterization of the debt to equity as proposed.

Treasury also delayed the implementation date, with the final rule coming into force only for debt instruments issued on or after Jan. 1, 2018. ABA staff will continue to review the 518-page final rule and provide analysis as needed. For more information, contact ABA’s John Kinsella.

ADVERTISEMENT
Tags: IRS
ShareTweetPin

Related Posts

ABA, associations urge lawmakers to finalize deal on debt ceiling

House passes ABA-backed ‘trigger leads’ bill

Mortgage
June 23, 2025

The House passed by voice vote legislation prohibiting credit reporting firms from selling mortgage applicant information to lenders who then barrage those same consumers with unwanted solicitations.

Senate bill would remove reputational risk from bank supervision

Fed removes reputational risk from bank exams

Compliance and Risk
June 23, 2025

The Fed has started the process of removing references to reputation and reputational risk from its supervisory materials, “and, where appropriate, replacing those references with more specific discussions of financial risk.”

Americans cite branch availability as reason for bank choice

OCC: Bank trading revenue $15B in Q1 2025

Economy
June 23, 2025

The cumulative trading revenue of U.S. commercial banks and savings associations was $15 billion in the first quarter of 2025, the Office of the Comptroller of the Currency reported.

White House pushes state policymakers to restrict ‘junk fees’

Trump signs resolution overturning OCC bank merger rule

Newsbytes
June 23, 2025

President Trump signed into law a joint resolution overturning a rule that changed how the OCC reviews proposed bank mergers.

OCC to merge community bank, large bank supervision departments

OCC to outline process for criminal referrals

Compliance and Risk
June 23, 2025

The OCC will issue a report detailing which regulatory violations can be referred to the Department of Justice for criminal prosecution, part of a larger effort to combat alleged overcriminalization of federal regulations.

Fed’s Bowman to keynote ABA Conference for Community Bankers

Bowman: Time to rethink leverage ratios

Newsbytes
June 23, 2025

The time has come for the federal banking agencies to revisit leverage ratios and their effects on Treasury markets, Federal Reserve Vice Chair for Supervision Michelle Bowman said.

NEWSBYTES

House passes ABA-backed ‘trigger leads’ bill

June 23, 2025

Fed removes reputational risk from bank exams

June 23, 2025

OCC: Bank trading revenue $15B in Q1 2025

June 23, 2025

SPONSORED CONTENT

AI Compliance and Regulation: What Financial Institutions Need to Know

Unlocking Deposit Growth: How Financial Institutions Can Activate Data for Precision Cross-Sell

June 1, 2025
Choosing the Right Account Opening Platform: 10 Key Considerations for Long-Term Success

Choosing the Right Account Opening Platform: 10 Key Considerations for Long-Term Success

April 25, 2025
Outsourcing: Getting to Go/No-Go

Outsourcing: Getting to Go/No-Go

April 5, 2025
Six Payments Trends Driving the Future of Transactions

Six Payments Trends Driving the Future of Transactions

March 15, 2025

PODCASTS

Podcast: Staying close to clients amid tariff-driven volatility

June 18, 2025

Podcast: Old National’s Jim Ryan on the things that really matter

June 12, 2025

Podcast: What bankers need to know about ‘First Amendment audits’

June 5, 2025
ADVERTISEMENT

American Bankers Association
1333 New Hampshire Ave NW
Washington, DC 20036
1-800-BANKERS (800-226-5377)
www.aba.com
About ABA
Privacy Policy
Contact ABA

ABA Banking Journal
About ABA Banking Journal
Media Kit
Advertising
Subscribe

© 2025 American Bankers Association. All rights reserved.

No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive

© 2025 American Bankers Association. All rights reserved.