Beginning in 2023, an excise tax of 1% will apply to public company stock buybacks and a 15% corporate minimum tax generally will apply to corporations with book income exceeding $1 billion.

Key Points:

..Public companies should consider the timing of stock buybacks and stock issuances in light of the excise tax.

..The excise tax is very broad in application, potentially applying to preferred stock, use of derivatives, mergers and acquisitions, and SPACs.

..Financial statement reporting will, for the first time in over 30 years, be an integral part of determining income taxes of corporations potentially subject to the minimum tax.

..US multinational corporations are more likely to bear the minimum tax due to lower taxed foreign income and permitted book income adjustment for accelerated tax depreciation, which reduces the potential of the tax being applied to US corporations with limited foreign activities.

..The statutory schemes of both the excise tax and the minimum tax rely heavily on future Treasury Regulations to provide more detailed rules.