Taxpayers subject to government fines and penalties received guidance on when those payments are deductible or not deductible under final regulations posted by the IRS on Tuesday, Jan. 12.
The final regulations (T.D. 9946) provide guidance on Sec. 162(f) and on information reporting requirements under Sec. 6050X.
The final regulations define “restitution,” “remediation” and “paid to come into compliance with a law” for purposes of Sec. 162(f). They also define which nongovernmental entities are treated as governmental entities subject to the Sec. 6050X reporting requirements. Learn more.