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The government will continue its no-ruling policy on questions involving the rescission doctrine while it works on regulations in this area, a senior Treasury Department official says. The doctrine generally provides that transactions can be disregarded for federal income tax purposes if the parties return to the status quo in the same tax year, an idea that is of key interest to many in the tax community. “We are considering the rescission doctrine from the ground up,” Treasury Tax Legislative Counsel Lisa Zarlenga says in answer to a question at a tax conference. While that effort is ongoing, “We need to stop the ruling process,” she says.
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