RELIEF FROM RETROACTIVE APPUCATION OF TREASURY DEPARTMENT REGULATIONS.

Sec. 1101. RELIEF FROM RETROACTIVE APPUCATION OF TREASURY DEPARTMENT REGULATIONS. (a) In general.— Subsection (b) of section 7805 (relating to rules and regulations) is amended to read as follows: “(b) Retroactivity of Regulations.— “(1) In general.— Except as otherwise provided in this subsection, no temporary, proposed, or final regulation relating to the internal revenue laws shall apply to any taxable period ending before the earliest of the following dates: 110 STAT. 1469 “(A) the date on which such regulation is filed with the Federal Register. “(B) in the case of any final regulation, the date on which any proposed or temporary regulation to which such final regulation relates was filed with the Federal Register. “(C) the date on which any notice substantially describing the expected contents of any temporary, proposed, or final regulation is issued to the public. “(2) Exception for Promptly Issued Regulations.— Paragraph (1) shall not apply to regulations filed or issued within 18 months of the date of the enactment of the statutory provision to which the regulation relates. “(3) Prevention of Abuse.— The Secretary may provide that any regulation may take effect or apply retroactively to prevent abuse. “(4) Correction of Procedural Defects.— The Secretary may provide that any regulation may apply retroactively to correct a procedural defect in the issuance of any prior regulation. “(5) Internal Regulations.— The limitation of paragraph (1) shall not apply to any regulation relating to internal Treasury Department policies, practices, or procedures. “(6) Congressional Authorization.— The limitation of paragraph (1) may be superseded by a legislative grant from Congress authorizing the Secretary to prescribe the effective date with respect to any regulation. “(7) Election to Apply Retroactively.— The Secretary may provide for any taxpayer to elect to apply any regulation before the dates specified in paragraph (1). “(8) Application to Rulings.— The Secretary may prescribe the extent, if any, to which any ruling (including any judicial decision or any administrative determination other than by regulation) relating to the internal revenue laws shall be applied without retroactive effect.”. (b) Effective Date.— The amendment made by subsection (a) shall apply with respect to regulations which relate to statutory provisions enacted on or after the date of the enactment of this Act.