Effective for tax years beginning on or after January 5, 2016, the Illinois Department of Revenue adopted amendments to 86 Ill. Adm. Code Sec. 100.3380 that establish special rules for the inclusion in the Illinois sales factor of certain (1) income, gains and losses from hedging transactions; and (2) gains and losses from foreign currency exchanges. First, the Department’s amended regulation generally provides that taxpayers must exclude from the numerator and denominator of the Illinois sales factor any income, gain or loss from a transaction identified as a “hedge” for federal income tax purposes, notwithstanding a taxpayer’s facts and circumstances. Borrowing from federal income tax concepts, the amended regulation also establishes several exceptions to this general rule of exclusion for certain “identified” or “integrated” hedging transactions. Second, the Department establishes special rules in the amended regulation with respect to foreign currency gains and losses, i.e., Internal Revenue Code § 988 transactions. Under the new rules, a taxpayer may include a foreign currency gain or loss in its Illinois sales factor only if the income to which the foreign currency gain or loss relates is also included in the sales factor. However, the amended regulation concludes that taxpayers shall exclude from their Illinois sales factors any foreign currency gains and losses “with respect to expense.”