IRS Announces Non-Applicability of Excise Taxes to Conform with DOL Temporary Enforcement Policy on Fiduciary Duty Rule

The Internal Revenue Service (IRS) issued Announcement 2017-4 to provide relief from certain excise taxes under Internal Revenue Code (IRC) Section 4975, and any related reporting requirements, to conform to the temporary enforcement policy described by the Department of Labor (DOL) in Field Assistance Bulletin 2017-01 with respect to the final fiduciary duty rule.

Because the IRC and ERISA contemplate consistency in the enforcement of the prohibited transaction rules by the IRS and the DOL, the Treasury Department and IRS determined that it is appropriate to adopt a temporary excise tax non-applicability policy that conforms with the DOL’s temporary enforcement policy. The IRS will not apply Section 4975 and related reporting obligations with respect to any transaction or agreement to which the DOL’s temporary enforcement policy, or other subsequent related enforcement guidance, would apply.

Announcement 2017-4 will be published in Internal Revenue Bulletin 2017-16, dated April 17, 2017.​