IRS EXEMPTS LIHTC AND NMTC TRANSACTIONS FROM REPORTABLE TRANSACTION DISCLOSURE RULES

Friday, January 26, 2007 - 7:15am

In Revenue Procedure 2007-20, the Internal Revenue Service exempts certain transactions with contractual protection from the disclosure rules under § 1.6011-4(b)(4) of the Income Tax Regulations. The American Jobs Creation Act (AJCA), which became effective October 22, 2004, included important changes to the Internal Revenue Code that had potentially chilling effects on general partners and/or developers of low-income housing tax credit (LIHTC), historic rehabilitation tax credit (HTC) or new markets tax credit (NMTC) partnerships, or properties that previously were thought exempt from reporting as tax shelters under IRC § 6111. Rev. Proc. 2007-20 exempts LIHTC and NMTC transactions, but HTC transactions were not exempted. This revenue procedure also applies for purposes of IRC § 4965.

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