Background
On May 6, 2015, the Internal Revenue Service issued proposed regulations providing guidance on the activities related to minerals and natural resources that will generate qualifying income under section 7704(d)(1)(E) of the tax code. While welcoming the much-needed clarity that the proposed regulations would provide in this area, MLPA had significant concerns with some aspects of the Proposed Regulations, particularly the attempt to provide an exclusive list of the operations that will constitute qualifying activities and the narrowness with which some activities are defined.
Final regulations were issued on January 19, 2017 and published in the Federal Register on January 24, 2017. Although not all the suggested changes were adopted, many were, and the final regulations overall are a great improvement over the Proposed Regulations. In particular, the “exclusive list” concept has been eliminated.
Additional Materials
- On August 4, 2015, MLPA (then NAPTP) submitted detailed comments on the proposed regulations and requested that the IRS hold a hearing on them.
- Click here for the text of the Proposed Regulations.
- Click here for MLPA’s comments on the Proposed Regulations, submitted to the IRS August 4, 2015.
- Click here for a summary of MLPA’s comments.
- .Click here for the text of the final regulations.
Panelists from Andrews Kurth, Baker Botts, Latham & Watkins and Vinson & Elkins analyzed the final regulations during webcasts on February 8, 2017 and May 9, 2017. The webcasts were recorded and are available for viewing, and the February 8 slides may be downloaded. Please click on the link below to access the recorded version of the webcast.
- Click here to view the February 8 webcast
- Click here to download the February 8 slides
- Click here for the May 9 webcast.
If you registered prior to the webcast, please click on the link and input your email address. Unless you pre-registered before the webcast, please register first, then you will be able to launch the webcast archive.