Treasury Department Gets Rid Of Tax Rules That Would Have Cost Small Businesses $18 Billion
Last week, the U.S. Treasury Department formally recommended withdrawing the Section 2704 regulations on family business valuation. The department said it plans to soon publish formal withdrawal orders in the Federal Register.
In a statement Treasury Secretary Steve Mnuchin said, “This is only the beginning of our efforts to reduce the burden of tax regulations. Our tax code has been broken for too long, and this retrospective review, along with our efforts on tax reform, will ensure that we have a tax system that fosters economic growth.” The Treasury Department’s full report is available here.
Withdrawal of these regulations is a significant victory for small businesses in the industrial metals industry since the regulations would have increased the estate tax burden on family businesses by at least $18 billion. The Metals Service Center Institute is part of the Family Business Coalition, which advocated on behalf of MSCI and other trade associations for withdrawal of the rules.
The Treasury Department report comes in response to President Donald Trump’s executive order calling for an end to the Section 2704 provision.