On October 9, 2019, the United States Treasury Department
published proposed regulations that address the federal tax
consequences of the expected phase-out of the London interbank
offered rate (LIBOR) after 2021 and possible elimination of all
interbank offered rates (IBORs). The intent of these regulations
generally is to provide federal tax relief that minimizes the
economic impact of the elimination of IBORs, including LIBOR.
The proposed regulations address both debt instruments and other
financial instruments (such as derivatives) that reference an IBOR,
such as a debt instrument providing for interest based on U.S.
dollar LIBOR.
Immediate Application Permitted
The proposed regulations can be applied immediately and
regardless of whether, or when, LIBOR is actually phased out. They
provide relief for debt instruments and other financial instruments
that are changed from IBOR-referencing rates in anticipation of the
expected phase out. Moreover, they provide
