Here is a look at recent tax-related happenings on the Hill, including the Senate Finance Committee advancing IRS chief counsel and U.S. Tax Court nominations.
Lately on the Hill
Russian Sanctions Law Expands Presidential Tariff Authority
President Donald Trump signed legislation (H.R. 5334) granting broad new tariff authority aimed at increasing pressure on Russia and countries that continue to support its energy exports.1 The law allows the administration to impose tariffs of up to 500% on Russian imports and up to 100% on goods imported from certain countries that purchase Russian energy products or facilitate sanctions evasion.
The legislation specifically targets the five largest importers of Russian-origin crude oil and natural gas, as well as the top five countries facilitating Russian oil sanctions evasion and requires periodic reviews to reassess which countries are subject to the duties. The law also authorized the U.S. Trade Representative to adjust the tariff rate, up to 100%, based on whether a country increases or decreases its purchases of Russian energy, while preserving presidential authority to waive the duties when deemed in the national interest. The tariff provisions are scheduled to take effect within 30 days of enactment, giving the administration until October 18, 2026 to implement the duties.
Senate Committee Sends IRS Chief Counsel, Tax Court Nominations to Full Senate
The Senate Finance Committee voted 14 to 13 on September 24 to advance Trump’s nominations of James Gadwood for IRS chief counsel and Andrew De Mello for a vacancy on the U.S. Tax Court to the full Senate for consideration.2 The action moves forward two key tax administration nominations, including a candidate for the IRS’ top legal position and a nominee to fill the remaining vacancy in the Tax Court.
From the Courts
Court Vacates EPA Termination of Solar for All Program
In Rhode Island AFL-CIO v. U.S. Environmental Protection Agency (EPA), the U.S. District Court for the District of Rhode Island held that the EPA unlawfully terminated the Solar for All program after enactment of the One Big Beautiful Bill Act (OB3). The court found that Congress intended previously obligated grants to remain in place despite repealing the underlying statutory authority and rescinding unobligated funds and concluded that the EPA exceeded its statutory authority by terminating the program and existing grants. Accordingly, the court granted summary judgment for the plaintiffs, declared the determination unlawful under the Administrative Procedure Act, and vacated the agency’s decision.
CBP Reports Continued Progress on IEEPA Tariff Refund Processing
In a filing submitted to the U.S. Court of International Trade, U.S. Customs and Border Protection (CBP) reported continued progress in processing refund claims related to duties imposed under the International Emergency Economic Powers Act (IEEPA) through its Consolidated Administration and Processing of Entries (CAPE) system. As of September 11, approximately $134.7 billion in potential and certified refunds had been accepted for processing, with roughly $122 billion in refunds certified and sent to the U.S. Department of the Treasury for disbursement. CBP also announced that CAPE Phase 3, which will cover certain finally liquidated entries for plaintiffs subject to the Court of International Trade’s order of reliquidation, is scheduled to be deployed on October 6, 2026.
From Treasury & the IRS
International Tax Guidance Projects Advance
Treasury and IRS officials recently provided updates on several international tax guidance projects. Treasury is considering revisions to the dual consolidated loss regulations to address concerns that a partial foreign use of a loss can trigger recapture of the entire loss amount,3 while the IRS indicated guidance on the new foreign sourcing rules for U.S.-produced inventory sold abroad could be issued by year-end.4
Separately, an IRS official suggested Treasury is unlikely to adopt tracing or extraordinary item approaches for allocating controlled foreign corporation (CFC) income under rules enacted by the OB3, although additional guidance is expected regarding basis adjustments for midyear transfers of CFC interests.5
IRS Warns Against Fake Tribal Tax Credit Schemes
The IRS warned taxpayers, tribal communities, businesses, and tax professionals about promoters marketing nonexistent “Tribal Tax Credits” that falsely claim to reduce federal tax liabilities or generate refunds. The agency emphasized that no such federal tax credits exist and that taxpayers who claim them could face additional tax, penalties, interest, and potential civil or criminal consequences.
IRS Announces New Mobile App
The IRS debuted a new mobile app that replaces IRS2Go and provides secure access to selected Individual Online Account features, including refund tracking, payments, notices, transcripts, and Identity Protection PINs. The agency stated the app is part of its ongoing effort to expand digital services and improve taxpayer access to IRS tools through mobile devices.
Released Guidance
Estate Tax Closing Letter Fee: Final regulations (T.D. 10055) increase the user fee for requesting an estate tax closing letter from $56 to $76. The final regulations adopt the proposed rules without change and apply to requests received by the IRS after October 25, 2026.
Farmland Tax Deferral: Proposed regulations (REG-117095-25) under Internal Revenue Code (IRC) Section 1062 detail how taxpayers can elect to pay, over four annual installments, the tax attributable to gain from the sale of qualified farmland property to a qualified farmer. The proposed rules clarify eligibility requirements, election procedures, and the circumstances that can accelerate payment of the remaining tax liability.
Trump Accounts: Temporary regulations (T.D. 10056) and proposed regulations (CC-00226466-26) implement key Trump Account provisions, including automatic enrollment of eligible children into Treasury-created accounts and rules for government and charitable contributions, including certain qualified stock donations. The proposed regulations withdraw and replace previously issued proposed regulations (REG-117270-25). The guidance indicates Treasury will begin establishing auto accounts on or about October 1, 2026.
ETF Basis-Shifting Transactions: Revenue Ruling 2026-20 provides that certain transfers of appreciated securities to a newly formed exchange-traded fund (ETF) followed by a planned redemption involving an authorized participant will be recharacterized based on their substance rather than their form. As a result, the investor is treated as engaging in a taxable exchange under IRC §1001 and must recognize gain on the transferred securities.
In conjunction with this Revenue Ruling, the IRS issued Notice 2026-62 identifying several investment fund strategies it believes may produce tax results inconsistent with the intent of federal tax rules, including certain ETF, partnership, and financial product transactions. The notice requests public comments and signals that additional guidance or enforcement actions may be forthcoming.
Remittance Tax Penalty Relief: Notice 2026-52 extends penalty relief and related deposit safe harbor protections for remittance transfer providers subject to the IRC §4475 remittance transfer tax. The relief, which previously applied only through the third quarter of 2026, now applies to semimonthly periods ending before final regulations become applicable, provided taxpayers make timely deposits and satisfy specified underpayment requirements.
Opportunity Zones: Notice 2026-55 requests comments on guidance needed to implement the amended Qualified Opportunity Zone rules under IRC §1400Z-2. The notice seeks input on issues including housing investment, the working capital safe harbor, operating businesses, investments held beyond 30 years, inclusion events, and investments in tribal and Alaska Native communities. Written comments should be submitted by November 23, 2026.
2026-2027 Per Diem Rates: Notice 2026-60 provides special per diem rates for substantiating business travel expenses and revised the localities eligible for enhanced travel allowances. The notice also identifies additions, removals, and other changes to the affected locations and generally applies to travel and per diem allowances paid on or after October 1, 2026.
Dividend Equivalent Transition Relief: Notice 2026-61 extends through 2028 transition relief for enforcing and administering the IRC §871(m) regulations governing dividend equivalent payments. The notice extends relief for certain non-delta-one transactions, combined transactions, qualified derivatives dealers, and qualified securities lenders, while keeping the anti-abuse rule in effect.
This newsletter features developing content that is subject to change at any time. It does not constitute legal or tax advice. Consult your professional advisors prior to acting on the information set forth herein.
- 1“Trump Signs Russia Sanctions Bill Granting New Tariff Powers,” news.bloombergtax.com, September 18, 2026.
- 2“Senate Panel Advances IRS Chief Counsel, Tax Court Nominees,” taxnotes.com, September 25, 2026.
- 3“Treasury Working on ‘All or Nothing’ Concern on Double-Dip Rules,” news.bloombergtax.com, September 18, 2026.
- 4“IRS Sees Guidance by Year’s End on US-Inventory Income Sourcing,” news.bloombergtax.com, September 18, 2026.
- 5“No Adjustment Expected for Bumpy CFC Income, IRS Official Says,” taxnotes.com, September 23, 2026.