Speculation Continues Regarding Potential Proposed §2704 Regulations

The general consensus among attorneys and accountants had been that the Treasury hoped to issue new proposed regulations under Section 2704(b) prior to this fall's tax section meeting of the ABA, which was September 17 through 19. Those dates passed without new regulations being issued. Now, the speculation is that new regulations won't be released until the end of 2015.¹

The concern that many have is that the new regulations will place stringent limitations on, or completely eliminate, the use of valuation discounts in family-controlled entity transactions. Those wanting to take advantage of valuation discounts in such situations should keep these potential regulations in mind.

No one knows if the soon-to-be-issued Proposed Regulations will be effective as of the date of the Proposed Regulations (this is not usually the case), or as of the date of issuance of the Final Regulations (which can be years after the issuance of the Proposed Regulations). One possibility