The controversial proposed Section 2704 regs have appeared in a list of regulations the Treasury says can be streamlined or withdrawn. This list is included in Notice 2017-28, which is in response to President Trump’s Executive Order 13789, a directive designed to reduce tax regulatory burdens. Comments on the notice are due by Aug. 7, 2017.
Big fight: The proposed regs drew a firestorm of criticism from the business valuation community as well as attorneys and estate planners. An unprecedented number of speakers testified at an IRS hearing to fight the proposed regs that are designed to curb estate valuation discounts for minority interests. Almost 29,000 comments are now included on the IRS docket page, many of which call for the rules to be withdrawn permanently. The American Society of Appraisers has issued a comment letter on the new notice calling for full withdrawal of the proposed regs, according to a news release.
The next step is for the Treasury and IRS to submit a final report by Sept. 18, 2017, to recommend their proposed reforms for the regulations identified in the notice (eight in all). This could range from modification to full repeal of the regulations.
What to do: Submit your comments to Notice 2017-28 by August 7—instructions to do so are in the notice. This is not over yet—voices still need to be heard!
For background, see Proposed IRC Section 2704: Potential Impacts on Estate and Gift Valuations, a BVR special report. It sheds light on the proposed regulations and helps appraisers navigate the possible implications on the valuation of private-business entity interests for transfer tax (estate, gift, and generation-skipping) purposes.