Treasury Asked to Scrap Stock Buyback Tax's Funding Rule

Tax attorney Joshua Odintz was quoted in a Law360 article raising concerns that the U.S. Department of the Treasury's funding rule on the stock buyback tax overshoots Congress' intent as outlined in a 2022 climate and tax law. He argued that the rule unjustly expands the tax's reach to include U.S. subsidiaries funding their foreign parent's stock repurchases, a substantial departure from the law's original language. Mr. Odintz indicated that this broadened interpretation could unfairly impact numerous companies with pre-existing stock buyback programs.

"This is an extreme leap from the statutory language of Section 4501 … given the fact that many publicly traded companies have long-term stock buyback programs in place at the parent level," he said. 

READ: Treasury Asked to Scrap Stock Buyback Tax's Funding Rule