On November 25, SFA submitted comments to the IRS and Treasury regarding their proposed Guidance on the Transition from Interbank Offered Rates to Other Reference Rates. The proposal provides guidance on the tax consequences of the transition to the use of reference rates other than interbank offered rates (IBORs) in debt instruments and non-debt contracts. SFA used the opportunity for comment to request that Treasury and the IRS provide further clarification regarding:

• Whether the activation of fallback rates will avoid taxable exchange treatment.
• Certain applications of the Substantial Equivalence Requirement.
• The character and source of one-time payments, and
• REMICs.

 If you are interested in joining SFA’s LIBOR Task Force or Tax Policy Committee, please contactthe SFA Team. 

To read SFA’s comments, click here.