Notice 2026-7: Additional interim guidance on application of CAMT
Proposed regulations will be published prior to publication of any final regulations relating to CAMT.
The IRS today released Notice 2026-7 providing additional interim guidance regarding the application of the corporate alternative minimum tax (CAMT).
Prior to the publication of any final regulations relating to the CAMT, Treasury and the IRS intend to issue proposed regulations (forthcoming proposed regulations) that are anticipated to include rules similar to the interim guidance provided in sections 3 through 10 of today’s notice (described below), as well as to the interim guidance previously provided in Notice 2025-27 (read TaxNewsFlash), Notice 2025-28 (read TaxNewsFlash), Notice 2025-46, and Notice 2025-49 (read TaxNewsFlash).
- Section 3 of today’s notice modifies the interim guidance provided in section 4 of Notice 2025-49 and addresses an adjustment to adjusted financial statement income (AFSI) for tax-deductible repairs with respect to section 168 property.
- Section 4 modifies the interim guidance provided in section 9 of Notice 2025-49 and addresses an adjustment to AFSI for section 197 amortization attributable to certain intangibles.
- Section 5 addresses an adjustment to AFSI for amortization of domestic research or experimental (R&E) expenditures.
- Section 6 addresses an adjustment to AFSI for certain production costs attributable to film, television, live theatrical, and sound recording productions.
- Section 7 addresses an adjustment to AFSI for certain low acquisition cost tangible property treated as materials and supplies.
- Section 8 clarifies and modifies the interim guidance for financially troubled companies provided in section 4 of Notice 2025-46.
- Section 9 modifies the anti-abuse rule in Prop. Treas. Reg. § 1.56A-4 that would apply to certain covered asset transactions.
- Section 10 addresses certain CAMT consequences of transactions involving intangible property subject to section 367(d).
Notice 2026-7 states that the forthcoming proposed regulations will be proposed to apply to tax years beginning on or after the date the regulations are finalized, but taxpayers generally may rely on the guidance in Notice 2026-7 for tax years beginning before that date (subject to certain consistency and other requirements).
A KPMG report with initial impressions and analysis of the guidance in Notice 2026-7 will soon be provided in a follow-up edition of TaxNewsFlash.