The IRS on Tuesday, Sept. 15, issued final regulations regarding the treatment of eligible terminated S corporations (ETSCs).
The regulations (T.D. 9914) provide guidance on the definition of an ETSC and rules relating to distributions of money by such a corporation after its post-termination transition period (PTTP).
The final rules also amend the regulations under Sec. 1371(f) to extend the treatment of distributions of money during the PTTP to all shareholders of the corporation and clarify the allocation of current earnings and profits to distributions of money and other property.
The regulations go into effect after their publication in the Federal Register and apply to tax years beginning after that date. The IRS has not yet scheduled a date for publication. Learn more.