Story perspectives

Investment Firm Urges Treasury: Regulate, Don’t Ban Section 351 Conversions

6/9/2026

Summary

Story summary

The Investment Company Institute asked the U.S. Treasury for guidance on Section 351 conversions that avoid capital-gains taxes.
ICI submitted a comment letter and met with Treasury officials, who discussed possibly shutting the practice and are evaluating a “transaction of interest” label, but have not issued final action.
ICI emphasized the non-tax benefits of the conversions and urged regulators to target only abusive cases rather than ban the practice.

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Story summary

The Investment Company Institute asked the U.S. Treasury for guidance on Section 351 conversions that avoid capital-gains taxes.
ICI submitted a comment letter and met with Treasury officials, who discussed possibly shutting the practice and are evaluating a “transaction of interest” label, but have not issued final action.
ICI emphasized the non-tax benefits of the conversions and urged regulators to target only abusive cases rather than ban the practice.