Treasury and the IRS Release Interim Guidance on the One-Percent Excise Tax on Stock Repurchases by Publicly Traded Companies

The “Inflation Reduction Act” introduced Section 4501, which contains a new percent excise on certain stock repurchases and economically similar transactions undertaken by publicly traded U.S. corporations and certain foreign corporations (referred to as “covered corporations”). The excise tax generally applies to transactions effected on or after January 1, 2023, and the applicable tax base is reduced by the fair market value of stock issuances made by covered corporations during the taxable year (referred to as the “netting rule”).
Source: Treasury and the IRS Release Interim Guidance on the One-Percent Excise Tax on Stock Repurchases by Publicly Traded Companies