Infrastructure Investors ‘Make Out Like Bandits’ in IRS Guidance (1)

The IRS shielded public-private infrastructure partnerships from one of the 2017 tax overhaul’s less business-friendly provisions—and those projects’ investors are poised to rake in the benefits.

New Internal Revenue Service guidance spares those heavily debt-financed public-private partnerships, or P3s, from the restriction by classifying them as “real property trades or businesses.” The IRS released the guidance Nov. 26, along with more than 400 pages of proposed rules for the law’s limit on debt interest payment write-offs (REG-106089-18).

The move effectively keeps the cost of debt from rising under a tax law change for consortiums of ...