TITLE: IRS 2026–2027 Priority Guidance Plan: What It Means for International Sellers
IRS Releases 2026–2027 Priority Guidance Plan
The Treasury Department and IRS have released the 2026–2027 Priority Guidance Plan, highlighting controlled foreign corporation reporting, foreign tax allocation, currency rules, withholding and digital assets.
For international sellers, this is an important compliance signal. The plan does not create a new filing deadline today. However, it shows where future IRS guidance may affect your existing records, calculations and returns.
This follows earlier September 2026 updates on Form 5472 penalty relief and the 1 October state sales tax changes. This article focuses on the new international reporting priorities without repeating those updates.
Understand what the new plan changes
The IRS Priority Guidance Plan contains 121 guidance projects. It sets priorities for Treasury and IRS resources. It does not guarantee that every project will be completed, and it does not set a deadline for completing any project.
From this plan year, the 12-month cycle aligns with the federal fiscal year:
- Starts: 1 October 2026
- Ends: 30 September 2027
- Current plan released: 29 September 2026
Treasury and the IRS expect to update the plan during the year. They have also indicated that further deregulatory items may be added.
The stated focus areas include:
- Continued implementation of the One, Big, Beautiful Bill Act
- Deregulation and burden reduction
- Tax-exempt organisations
- Tribal tax issues
- Digital assets
- Other tax administration priorities
For international sellers, the practical message is clear: maintain complete records now. Future guidance may change how existing income, foreign taxes, currency movements and digital asset transactions are calculated or reported.
Track the CFC and foreign tax projects closely
Several projects directly affect groups with foreign subsidiaries, CFC interests, foreign branches or cross-border inventory activity.
Review Subpart F and tested income calculations
The plan includes final regulations under sections 951 and 951A, together with related provisions covering a US shareholder’s pro rata share of:
- Subpart F income
- Net CFC tested income
- Stock-basis adjustments
- Section 1248 calculations where a shareholder sells a CFC interest during the year
Notice 2025-75 was published on 22 December 2025. Proposed regulations were published on 26 August 2026, with comments due by 26 October 2026.
An IRS official has indicated that the government does not intend to adopt a transaction-specific, holding-period approach. The expected clarification of stock basis and section 1248 calculations could still affect year-end work for groups buying, selling or restructuring foreign subsidiaries.
Action: Keep ownership charts, acquisition records, stock basis schedules, earnings and profits calculations and Subpart F workings together. This will reduce the risk of rebuilding historic data when final regulations are issued.
Prepare for changes to foreign tax allocation
The plan also includes final regulations under section 898(c) concerning taxable years of specified foreign corporations and the allocation of foreign taxes following repeal of the section 898(c)(2) one-month deferral election.
Relevant notices were issued in December 2025, and proposed regulations were published on 3 August 2026.
Further projects under sections 250 and 904 address the allocation and apportionment of expenses. Proposed regulations were published on 11 September 2026, with comments due by 10 November 2026.
The IRS also plans guidance under section 904 covering the source of certain income from inventory produced in the United States and sold outside the United States through a foreign branch.
Action: Reconcile foreign tax accruals, expense allocations, inventory movements and branch-level income monthly. Clear records will help you support foreign tax credit calculations and sourcing positions.
Do not overlook currency and investment rules
The plan includes further regulations under section 987, covering currency gain or loss relating to qualified business units. Notice 2026-17 was published on 16 March 2026, and additional proposed regulations followed on 14 August 2026.
Other listed projects include:
- Final regulations under section 897(h) for domestically controlled qualified investment entities
- Regulations under sections 1297 and 1298 concerning passive foreign investment companies
- Further regulations and guidance under section 871(m) concerning dividend equivalents
These areas may be particularly relevant where a group uses foreign branches, holds investments through multiple jurisdictions or receives US-source investment income.
Apply the section 871(m) relief correctly
Notice 2026-61, issued on 21 September 2026, extended existing section 871(m) transition relief by two years.
The notice postpones the application of certain rules to non-delta-one transactions issued before 1 January 2029. The IRS will continue to consider good-faith compliance efforts when enforcing the rules for:
- Delta-one transactions through 2028
- Covered non-delta-one transactions in 2029
The notice also extends through 2028:
- The simplified standard for identifying combined transactions
- Certain relief for qualified derivatives dealers
- The deferral of the net delta exposure calculation requirement
- Relief from certain QDD review and reporting obligations
Withholding agents may continue applying qualified securities lender transition rules for payments made in 2027 and 2028.
The anti-abuse rule remains applicable throughout the extended transition period. Taxpayers and withholding agents may rely on the notice while regulatory amendments are pending.
Action: If you receive US-source dividend equivalents or operate as a withholding agent, update your 2027 and 2028 procedures. Do not treat transition relief as a permanent exemption. Maintain transaction classifications, withholding statements and documentation supporting good-faith compliance.
Keep crypto records ready for the next phase
Digital assets are a specific focus of the new plan. The listed projects include:
- Guidance on transactions involving digital assets, including wrapping
- Electronic furnishing of information returns
- Section 6045 rules for electronic payee statements relating to digital asset sales
- Information reporting under amendments introduced by the Infrastructure Investment and Jobs Act
- Section 6045 regulations for US brokers reporting certain digital asset transactions of foreign persons under the OECD Crypto-Asset Reporting Framework
The CARF project remains proposed guidance, not final law. The United States has signalled an intention to move towards the first exchanges of crypto information by 2029. CARF reporting is not already in force.
Existing broker reporting is already developing. Form 1099-DA provides gross proceeds reporting for transactions on or after 1 January 2025, with basis reporting phased in during 2026.
Action: Reconcile the following records every month:
- Wallet addresse
