Understanding the Stock Buyback Excise TaxPDF
As part of the Inflation Reduction Act (P.L. 117-169), Congress introduced a 1% excise tax on all stock buybacks occurring after December 31, 2022. However, Internal Revenue Code section 4501, which imposes the excise tax, left many questions unanswered. On December 27, 2022, Treasury issued Notice 2023-2, clarifying some of these uncertainties.