Daily Tax Update - September 19, 2016: Tax Court Rules Exelon Transactions are Loans

Tax Court Rules Exelon Transactions are Loans:  Today, the US Tax Court ruled against Exelon Corporation, an energy utilities company, holding that certain agreements were not true leases but rather properly characterized as loans under the substance over form doctrine.  Exelon sought to offset gain from the sale of several fossil fuel power plants in 1999 through a series of like-kind exchanges employing sale-leaseback strategies with tax-exempt public utilities.  The court also held that the agreements did not meet the requirements for a like-kind exchange because Exelon exchanged power plants for an interest in financial instruments. 

IRS Extends Temporary Nondiscrimination Relief for Closed Defined Benefit Plans:  Today, the IRS released Notice 2016-57, which extends the temporary nondiscrimination relief for closed defined benefit plans provided in Notice 2014-5 by making that relief available for plan years beginning before 2018 if the conditions of Notice 2014-5 are satisfied.