IRS and Treasury’s Proposed Section 385 Regulations

What you need to know for your business


US Treasury and the IRS released final and temporary Section 385 regulations, which address whether certain instruments between related parties are treated as debt or equity. 

The government made significant changes in the final regulations in response to taxpayer comments, dramatically narrowing the application of the rules to better focus on related party financings that have potential to erode the US tax base. 

Contact us

David Schenck
US Insurance Tax Leader
Tel: +1 (202) 549 9412

Peter Frank
Tel: +1 (646) 471 2787

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