applicable federal rates/AFRs Archives

IRS roundup: October 7 – October 23, 2025

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for October 7, 2025 – October 23, 2025.

October 7, 2025: The IRS issued Notice 2025-55, providing guidance on relief from failure to deposit penalties under Internal Revenue Code (Code) Section 6656 as it relates to a new excise tax being imposed on particular remittance transfers under Section 4475 for the first three quarters of 2026. The notice also includes guidance on the deposit safe harbor under Treas. Reg. § 40.6302(c)-1(b)(2), explaining that a remittance transfer provider will not be affected by failure to make deposits of the remittance transfer tax if they satisfy certain requirements.

October 16, 2025: The IRS issued Revenue Ruling 2025-21, providing various prescribed rates (for federal income tax purposes) for November 2025, including:

The short-, mid-, and long-term applicable federal rates (AFRs) for November 2025 as it relates to Section 1274(d).
The short-, mid-, and long-term adjusted AFRs for November 2025 as it relates to Section 1288(b).
The adjusted federal long-term rate and the long-term tax-exempt rate described in Section 382(f).

October 17, 2025: The IRS issued Revenue Procedure 2025-32, modifying certain sections of Revenue Procedure 2024-40 to reflect amendments resulting from the One Big Beautiful Bill Act (OBBBA). Revenue Procedure 2024-40, which displays IRS inflation-adjusted items for 2025, was specifically revised by removing the existing sections on standard deductions and the election to expense certain depreciable assets. Revenue Procedure 2025-32 also describes inflation-adjusted items for 2026 for various Code provisions.

October 21, 2025: The IRS issued Notice 2025-57, providing guidance on returns related to certain interest on specified passenger vehicle loans received in a trade or business from individuals, which are required to be filed under the new Section 6050AA as enacted in the OBBBA. Recognizing the need for efficient administration of Section 6050AA, Section 3 of Notice 2025-57 provides a means for interest recipients to report obligations under Section 6050AA.

October 22, 2025: The IRS issued frequently asked questions (FAQs) addressing Employee Retention Credits (ERC) under the ERC compliance provisions of the OBBBA. Although not final guidance, “a taxpayer who reasonably and in good faith relies on these FAQs will not be subject to a penalty that provides a reasonable cause standard for relief, including a negligence penalty or other accuracy-related penalty, to the extent that reliance results in an underpayment of tax.”

October 23, 2025: The IRS issued Notice 2025-63, announcing the US Department of the Treasury and IRS’s intentions to issue proposed regulations providing that certain borrow fees are sourced based on the recipient’s residence. Currently, neither the Code nor Treasury regulations specify how to determine borrow fees as they relate to securities lending transactions and sale-repurchase transactions. Thus, the Treasury and the IRS intend to clarify this in Notice 2025-63.

The IRS also released its weekly list of written determinations (e.g., Private [...]

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IRS roundup: August 12 – August 20, 2025

Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for August 12, 2025 – August 20, 2025.

IRS guidance

August 15, 2025: The IRS issued Notice 2025-42, providing guidance consistent with Executive Order 14315, Ending Market Distorting Subsidies for Unreliable, Foreign-Controlled Energy. This notice specifically provided guidance on when construction of an applicable wind facility or solar facility has begun, which determines whether that facility is subject to the credit termination provisions added to Internal Revenue Code §§ 45Y and 48E by §§ 70512 and 70513 of Public Law 119-21, also known as the One Big Beautiful Bill Act.

August 18, 2025: The IRS issued Notice 2025-43, providing guidance on the corporate bond monthly yield curve, corresponding spot segment rates in Code § 417(e)(3), and the 24-month average segment rate in Code § 430(h)(2). This notice also provides guidance on the interest rate on 30-year Treasury securities in Code § 417(e)(3)(A)(ii)(II) for plan years commencing prior to 2008, as well as the 30-year Treasury weighted average rate in Code § 431(c)(6)(E)(ii)(I).

August 18, 2025: The IRS issued Revenue Ruling 2025-17, providing prescribed rates for federal income tax for September 2025, including:

The short-, mid-, and long-term applicable federal rates (AFRs) for purposes of Code § 1274(d).

The short-, mid-, and long-term adjusted AFRs for purposes of Code § 1288(b).

The adjusted long-term rate and the long-term tax-exempt rate from Code § 382(f).

The appropriate percentages for determining the low-income housing credit under Code § 42(b)(1) for buildings placed in service during September 2025.

The federal rate for determining the present value of an annuity, an interest for life, a term of years, or a remainder or a reversionary interest under Code § 7520.

August 19, 2025: The IRS issued Notice 2025-45, announcing its intent to issue proposed regulations under Code §§ 897(d) and (e), which would modify the application of Treas. Regs. §§ 1.897-5T and 1.897-6T to certain transactions involving the transfer of US real property interests. The proposed regulations would also revise rules applying to inbound asset reorganizations in Code § 368(a)(1)(F). This notice also announced the US Department of the Treasury and IRS’s intent to issue proposed regulations, revising Treas. Reg. § 1.368-2(m) and clarifying that qualification as a potential F reorganization under § 368(a)(1)(F) would not be affected by a disposition of stock.

August 20, 2025: The IRS issued Notice 2025-44, requesting comments on certain dual consolidated loss (DCL) rules and announcing its intent to issue proposed regulations removing (see our discussion of the notice in this On the Subject):