Before leaving town for an extended recess ending after the November 8th elections, Congress approved a short-term funding bill for the federal government.  The same issues must be addressed in a lame duck session in December but with uncertainty as to how they will be resolved pending the outcome of the elections. The Treasury Department issued final debt-equity regulations under Code section 385 to address “earnings stripping,” with the final regulations significantly narrower in scope than the proposed regulations reflecting changes that respond to comments received by the Government from taxpayers.

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