Here is a look at recent tax-related happenings on the Hill, including continued progress reported on International Emergency Economic Powers Act (IEEPA) refund processing.
Lately on the Hill
Congress in Recess
The House of Representatives and Senate are in recess until after the midterm elections. Both chambers are scheduled to return on November 9, 2026.
Executive Order Directs Temporary Diesel Tax Relief for Farmers & Truckers
On October 5, 2026, President Donald Trump issued an executive order providing temporary diesel fuel tax relief aimed at farmers, truckers, and other industries affected by higher fuel costs. The order allows certain diesel fuel excise taxes incurred between October 5, 2026 and December 31, 2026 to be deferred without penalties, interest, or additional tax. It also provides penalty relief for certain highway uses of dyed diesel fuel during the relief period.
From the Courts
CBP Reports Continued Progress on IEEPA Refund Processing
In an October 6 court filing, U.S. Customs and Border Protection (CBP) reported that, as of October 2, 2026, a total of 297,887 declarations had been submitted, with 209,262 passing file validations. The accepted declarations cover 27.4 million entries, and approximately $136.6 billion in potential and certified refunds have been accepted for processing.
CBP also reported that approximately $126 billion in refunds, including interest, had been certified and sent to the U.S Department of the Treasury for disbursement. In addition, 20,362 refunds totaling approximately $1.1 billion had not been transmitted because Automated Clearing House information had not been provided by the importer of record or its authorized designee.
From Treasury & the IRS
Treasury, IRS Officials Preview Regulatory Priorities
Treasury and IRS officials used the American Bar Association Section of Taxation Virtual 2026 Fall Tax Meeting and a program hosted by the Practising Law Institute to provide updates on several pending guidance projects and regulatory priorities.
- Saver’s Match: Treasury is reviewing comments and plans to issue proposed regulations as soon as possible. The program takes effect January 1, 2027 and provides a federal match of 50% of eligible retirement contributions, up to $1,000, for certain taxpayers.1 Treasury is also considering whether qualifying plans may accept Saver’s Match rollovers.
- Trump Accounts: Forthcoming final regulations may provide additional flexibility for correcting average benefits testing failures for employer contributions.2 Officials also said salary reduction contributions may be accepted before the end of 2026.
- One Big Beautiful Bill Act (OB3) implementation: Treasury expects proposed regulations under Internal Revenue Code (IRC) Sections 163(j), 168(n), 174, and 174A before year-end, providing guidance on business interest deductions, qualified production property depreciation, and research and experimental expense provisions.3
- Foreign-controlled foreign corporation rules: IRS officials said proposed regulations under IRC §951B are actively being drafted and could be released in the near term.4 The guidance is expected to address the new foreign-controlled foreign corporation rules enacted by the OB3, including operation of the substitution rule.
- Related party debt rules: Treasury is reconsidering the IRC §385 related party debt funding rule, citing concerns that it creates significant compliance burdens.5 Officials said proposed regulations are expected by September 2027.
- Donor-advised funds: IRS officials said guidance is expected soon to address concerns with proposed regulations under IRC §4966, particularly regarding the proposed applicability date and treatment of investment advisers as donor-advisers.5
- Inbound reorganizations: IRS officials said they are considering guidance under IRC §367(b) that could provide relief from income inclusion rules applicable to certain shareholders in inbound reorganizations.6
- Foreign government investment rules: IRS officials said guidance on the “effective control” provisions under IRC §892 is a higher priority than guidance on debt origination.7 Officials also indicated that typical minority investor protections generally were not intended to result in effective control.
- Foreign tax credits: Treasury and the IRS expect proposed regulations before year-end on IRC §904(b)(6), which allows up to 50% of income from certain sales of U.S. produced inventory through a foreign branch to be treated as foreign source income for federal tax credit limitation purposes.8
- International tax regulations: IRS officials said it is “critical” to finalize several proposed international tax regulations by January 4, 2027 to preserve the ability to apply them retroactively to the enactment of the OB3.9 The projects include guidance under IRC §§250, 898, 951(a), 960(d)(4), and 904(b)(5).
OIRA Reviews Institutional Investor Housing Rules
The Office of Information and Regulatory Affairs (OIRA) has completed its review of proposed regulations to implement new restrictions on large institutional investors purchasing single-family homes. Treasury generally releases the rules shortly following completion of the review.
Released Guidance
Digital Asset Trust Staking Rules: Revenue Procedure 2026-20 updates and expands the safe harbor for certain digital asset trusts that stake proof-of-stake digital assets while maintaining their status as investment trusts and grantor trusts for federal income tax purposes. The guidance is effective for tax years ending on or after October 6, 2026 and provides a six-month transition period for existing trusts to amend governing documents or revise procedures to comply with the updated requirements.
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“Treasury Reviewing Saver’s Match Comments Ahead of Proposed Rule,” news.bloombergtax.com, October 6, 2026.
- 2“Final Trump Account Rules for Employers Could Be More Flexible,” taxnotes.com, October 6, 2026.
- 3“Treasury Plans to Implement Next Three OBBBA Projects by Year-End,” taxnotes.com, October 7, 2026.
- 4“IRS, Treasury Advancing on Foreign Anti-Abuse, Debt-Equity Rules,” news.bloombergtax.com, October 6, 2026.
- 5“New Guidance on Donor-Advised Funds Coming Soon, Official Says,” taxnotes.com, October 7, 2026.
- 6“Time to Revisit Income Inclusion for Inbound Reorgs, IRS Says,” taxnotes.com, October 8, 2026.
- 7“IRS Prioritizing Foreign Government Effective Control Guidance,” taxnotes.com, October 8, 2026.
- 8“Guidance on New FTC Source Rule Expected by Year-End,” taxnotes.com, October 8, 2026.
- 9“IRS Says ‘Critical’ to Finalize Foreign Tax Rules by Jan. 4,” news.bloombergtax.com, October 7, 2026.