The IRS released Internal Revenue Bulletin 2026-39 with final and proposed regulations affecting individual taxpayers, tax-exempt organizations, and international tax provisions. Tax professionals should review these updates to stay informed about changes involving deductions, reporting requirements, and tax administration.
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The Internal Revenue Bulletin (IRB) is the authoritative instrument for announcing official rulings and procedures of the IRS and for publishing Treasury Decisions, Executive Orders, Tax Conventions, legislation, court decisions, and other items of general interest.
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ADMINISTRATIVE, INCOME TAX
T.D. 10054, page 372.
This document contains final regulations regarding the deduction for certain taxpayers for an amount up to $10,000 of qualified passenger vehicle loan interest. This document also contains final regulations regarding new information reporting requirements for certain persons who, in a trade or business, receive from any individual interest aggregating $600 or more for any calendar year on a specified passenger vehicle loan, including applicable penalties for failures to file information returns or furnish payee statements as required. These regulations affect taxpayers that may deduct qualified passenger vehicle loan interest, and also persons subject to these information reporting requirements.
EXEMPT ORGANIZATIONS
Announcement 2026-16, page 413.
Revocation of IRC 501(c)(3) Organizations for failure to meet the code section requirements. Contributions made to the organizations by individual donors are no longer deductible under IRC 170(b)(1)(A).
REG-119986-25, page 440.
This document contains proposed regulations providing that a school cannot qualify for tax-exempt status as a charitable organization under § 501(c)(3) if it maintains racially discriminatory practices or policies. The IRS has taken this position in sub-regulatory guidance for several decades. The proposed rules would further state that racial discrimination is incompatible with charitable tax-exempt status regardless of the purpose behind that discrimination. The proposed regulations would affect tax-exempt private schools, including primary and secondary schools, colleges, universities, and professional or trade schools.
INCOME TAX
REG-115646-25, page 414.
These proposed regulations would provide rules for determining a United States shareholder’s pro rata share of subpart F income, tested income, or tested loss of a controlled foreign corporation that reflect amendments made by Public Law 119- 21, 139 Stat. 72 (July 4, 2025), commonly known as the One, Big, Beautiful Bill Act (OBBBA). The proposed regulations would also modify certain information reporting requirements and the applicability dates of certain related rules. Additionally, the proposed regulations include the rules described in Notice 2025- 75 regarding the transition rule contained in section 70354(c) (2) of the OBBBA.
Revenue Procedure 2026-32 provides procedures under § 446 of the Internal Revenue Code and § 1.446-1(e) for obtaining automatic consent of the Commissioner of Internal Revenue to change methods of accounting for research or experimental expenditures (i) to comply with § 174, as in effect after amendment by § 13206(a) of Public Law 115- 97, 131 Stat 2054 (Dec. 22, 2017), commonly known as the Tax Cuts and Jobs Act (TCJA), and prior to amendment by § 70302(b)(1) of Public Law 119-21, 139 Stat. 189, 239 (July 4, 2025), commonly known as the One, Big, Beautiful Bill Act (OBBBA), and (ii) to comply with §§ 174 and 174A, as amended and enacted by the OBBBA, respectively. Revenue Procedure 2026-32 also provides procedures under § 446 and § 1.446-1(e) for obtaining automatic consent of the Commissioner to change methods of accounting for contracts entered into in taxable years beginning after July 4, 2025, to comply with § 460(e), as amended by the OBBBA.