RP-18-12, Continuity Of Interest requirement Safe Harbor

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IRS GuideWire

January 23, 2018

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Issue Number: RP-2018-12

Inside This Issue

Revenue Procedure 2018-12 provides safe harbors that taxpayers may use to value stock for purposes of the COI requirement. If the conditions set forth in the revenue procedure are met, taxpayers may use the average of the daily volume weighted average prices, the average of the average high-low daily prices, or the average of the daily closing prices of stock trading on certain stock exchanges in order to determine whether the COI requirement has been satisfied under the signing date rule or the closing date rule. The revenue procedure also clarifies that the IRS will entertain requests for rulings and determination letters regarding transactions and legal issues to which the safe harbors in the revenue procedure do not apply and regarding the applicability of the safe harbor set forth in this revenue procedure.

Revenue Procedure 2018-12 will be in IRB 2018-06, dated 2/5/2018.

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