Trump executive orders to be reflected in Priority Guidance Plan

In Notice 2017-28 released April 21, the IRS requested recommendations of items for inclusion in the 2017—2018 Priority Guidance Plan, the updated annual list of tax issues that the Service should address through regulations and other published administrative guidance. As it did the previous year (Notice 2016-26), the IRS stated that in selecting projects for inclusion, it will consider whether the recommended guidance involves significant issues relevant to many taxpayers; reduces controversy and lessens taxpayer and administrative burdens; promotes sound tax administration; can be administered uniformly; can be drafted in a way that taxpayers can easily understand and apply; and targets for change or withdrawal existing guidance that is outdated, unnecessary, ineffective, insufficient, or overly burdensome. This year, however, an added criterion is whether the recommended guidance would be in accordance with Executive Orders 13771, 13777, or others issued by President Donald Trump.

Executive Order 13771 generally requires for fiscal year 2017 that federal agencies identify at least two existing regulations to be repealed for every new one proposed and that the “incremental cost” of all new regulations finalized in fiscal year 2017, including repealed regulations, be no greater than zero. Executive Order 13777 establishes agency “regulatory reform task forces” to review existing regulations and make recommendations for repealing or modifying regulations that “eliminate jobs, or inhibit job creation” or “impose costs that exceed benefits,” among other criteria.

Not mentioned specifically in Notice 2017-28 but issued the same day and likely among the “other recent executive orders that may affect the number or type of guidance projects that can be issued” was Executive Order 13789, in which Trump directed Treasury to identify and “mitigate the burden” of Treasury regulations issued since the beginning of 2016 that impose an undue financial burden on taxpayers, add undue complexity to federal tax laws, or exceed the IRS’s statutory authority (see “Treasury Ordered to Review 2016 Tax Regulations,” The Tax Adviser online). In May, the AICPA in a letter to Treasury Secretary Steven Mnuchin submitted its recommendations for review of six proposed and final regulatory items issued during the period (the letter is available at aicpa.org).

Recommendations for the 2017—2018 Priority Guidance Plan were requested by June 1, but the IRS noted that taxpayers may submit recommendations throughout the year that may be included in interim updates.

• Notice 2017-28

—By Paul Bonner, a JofA senior editor.