Excise Tax


On August 16, 2022, President Biden signed the Inflation Reduction Act (“IRA”) into law. One of the new provisions the IRA introduced is the stock buyback excise tax under Code section 4501, which applies as of January 1, 2023 and was designed to target large corporations that implement stock buybacks. Background Code section 4501 imposes a 1% excise tax on the value of covered corporation stock that is repurchased by the covered corporation or a…