MFA sent a letter to the Department of the Treasury and the Internal Revenue Service recommending targeted changes to proposed regulations under Section 892.
MFA recommended that Treasury and the IRS:
- Preserve the longstanding presumption that loans and other debt investments are not commercial activities.
- Clearly distinguish traditional banking activities from nonbank investment activities.
- Confirm that secondary-market debt purchases by nondealers constitute investment activity.
- Protect existing investments by providing transition relief for loan modifications and draws under revolving credit facilities and delayed-draw term loans.
