• Fiscal Year Taxpayers Reminded about Blended Corporate Tax Rate
  • April 19, 2018
  • Notice 2018-38, released April 16, reminds fiscal year taxpayers about the requirement to apply a blended tax rate under Section 15 of the Code to their taxable year that includes January 1, 2018. The Tax Cuts & Jobs Act (the “TCJA”) changed the corporate tax rate, effective for taxable years beginning after December 31, 2017, in the middle of fiscal year taxpayers’ tax year. Under Section 15(a) of the Code, a corporation with a tax year that includes January 1, 2018, but does not start on that day, must apply a blended tax rate, calculated by applying the rates before and after the TCJA to the proportional sum of days in each period. The Notice confirms the requirement to use this modified rate, as well as provides examples of computing a corporation’s corporate tax rate and resulting AMT from before the enactment of the TCJA (as the TCJA repealed the AMT for corporations).

    Read the notice Here