IRS heads toward deregulation
In a significant move towards deregulation, the Internal Revenue Service (IRS) and Treasury Department have announced plans to eliminate a variety of guidance documents and regulations. These changes are part of the Trump administration’s broader agenda to reduce federal overreach and streamline the regulatory environment for businesses, particularly small businesses. The key points and implications impacting businesses are summarized below.
Nine IRS guidance documents to be eliminated
On April 14, 2025, the IRS released Notice 2025-22, identifying nine “extraneous and unnecessary” guidance documents that will be eliminated. In partnership with the Department of Government Efficiency (DOGE) and the Office of Management and Budget (OMB), the IRS expects the regulatory culling of hundreds of other similar guidance documents in the near future.
- Listing Notice Basket Option Contracts, 2015-46 IRB 660, Notice 2015-73
- Guidance Under 409A(a)(2)(A)(v) on Certain Transactions Pursuant to the Emergency Economic Stabilization Act of 2008, 2009-25 IRB 1093, Notice 2009-49
- Medical Device Excise Tax Deposit Penalty Relief, 2018-8 IRB 359, Notice 2018-10
- Taxable Medical Devices; Correction, 2013-16 IRB 940, 2013-23
- Taxable Medical Devices; Correction, 2013-14 IRB 760, 2013-19
- Excise Tax on High Cost Employer-Sponsored Health Coverage, 2015-10 IRB 732, Notice 2015-16
- Section 4980l Excise Tax on High Cost Employer Sponsored Health Coverage, 2015-35 IRB 227, Notice 2015-52
- Foreign Tax Credit and Other Guidance Under Section 965, 2005-36 IRB 471, Notice 2005-64
- Partnership Effectively Connected Income Lookthrough, 199-20 IRB 20, Rev Rul 91-32
Treasury’s regulatory trim
On the same day, the Treasury Department issued a direct final rule (the “Rule”) streamlining titles 12 and 31 of the Code of Federal Regulations by eliminating rules that have been identified as no longer necessary or no longer have current or future applicability.
Unless significant adverse feedback is received by May 15, 2025, the Rule will go into effect on June 15, 2025, repealing or revising the following financial, banking, and procedural regulations.
Treasury Secretary Scott Bessent has emphasized that these actions are part of President Trump’s agenda to unleash American prosperity by reining in burdensome regulations, particularly for small businesses.
Deregulation theme
Both the IRS and Treasury are committed to identifying and removing now-obsolete regulations dating back many years, as well as rules and guidance from the Biden administration. This continues the theme of deregulation aimed at reducing compliance burdens for businesses and taxpayers.
The Trump administration has already signed a joint resolution passed by Congress under the Congressional Review Act (CRA) to overturn a final IRS regulation established during the Biden administration. Known as the “DeFi” or “middleman” regs, the rule defined digital asset broker definitions for decentralized entities subject to broker reporting rules under the Infrastructure Investment and Jobs Act. With the president’s signature, the rule is no longer in effect and will be treated as if it never had been issued.
Implications for businesses
For businesses, particularly small enterprises, these deregulation moves mean less red tape and fewer compliance challenges. It’s essential to stay updated on the changes as the IRS and Treasury continue their reviews and eliminations.
As your Opportunity Advisors, we are closely monitoring these and other tax regulation changes. We will continue to provide you with updates to help you maximize tax planning and saving opportunities.
Regulation change questions specific to your business? Contact your Opportunity Advisor.
Source: Thomason Reuters/Tax & Accounting
