The IRS released proposed regulations on December 16, 2019, which provide proposed rules with respect to changes made by the Tax Cuts and Jobs Act of 2017 to the Internal Revenue Code limitation on the deduction for executive compensation. Section 162(m) of the Code generally imposes a $1 million deductibility limit on compensation paid to “covered employees” of a “publicly held corporation” for any taxable year, unless an exception applies. Section 162(m) was significantly amended by the TCJA, which removed a long-standing exemption for certain performance-based compensation, expanded the definitions of “covered employee” and “publicly held corporation” and provided a transition rule applicable to certain arrangements outstanding as of November 2, 2017. The proposed regulations provide guidance on these provisions and propose additional changes to the application of Section 162(m). Notably, the proposed regulations would (1) eliminate the Section 162(m) IPO transition relief; (2) expand a corporation’s covered employee population to include covered employees of an acquired corporation; (3) provide that Section 162(m) applies to a corporation’s distributive share of a partnership’s deduction for compensation paid by a partnership; and (4) provide that Section 162(m) may apply to foreign private issuers.