Summary of Notice 2026-7: Additional Interim CAMT Guidance
Attached is Capitol Tax Partners' summary of interim guidance released by the Treasury Department and the Internal Revenue Service (IRS) on February 18 regarding the application of the corporate alternative minimum tax (CAMT). Notice 2026-07 (the "Notice") provides guidance related to the interaction of the CAMT rules and (i) the treatment of repairs and maintenance expenses under section 162; (ii) adjustments to adjusted financial statement income (AFSI) for section 197 amortization attributable to certain intangibles; (iii) the treatment of research and experimental (R&E) expenditures under section 174 and section 174A, as enacted by P.L. 119-21 (the One Big Beautiful Bill Act (OBBBA)); (iv) the treatment of certain qualified production expenses under section 181; (v) adjustments to AFSI for certain low acquisition cost tangible property treated as materials and supplies; (vi) the treatment of financially troubled companies; (vii) anti-abuse rules related to certain covered transactions; and (viii) transactions involving intangible property subject to section 367(b).
Continuing the trend observed with recent CAMT guidance, the Notice, on initial review, appears to be entirely taxpayer favorable, incorporating positive changes that respond to issues taxpayers have identified since before the proposed CAMT regulations were released.