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One Extenders Deal Put Off After Veto Threat, 2014 Extension Vote May Be Coming Soon

For a few hours last week, it appeared that there was a bipartisan agreement on expiring tax provisions, but shortly after press reports on the deal, the agreement fell apart under threat of a White House veto.  In a surprise to many, about 10 expiring tax provisions would have been made permanent under the agreement, including the research credit and expanded section 179 expensing. ...

Treasury Dropping Hints on Earnings Stripping

Treasury Department officials are stating publicly the potential methods it is considering to reduce the benefit of inversion transactions through so-called “earnings stripping.”  According to reports of an October 29 panel discussion, Treasury is considering cutting back on interest deductions under section 163(j), or treating certain instruments as equity rather than debt...

The “Very Near Future” is Now: Treasury and IRS Release Anti-Inversion Notice

After much anticipation, the Treasury Department and IRS released new “anti-inversion” guidance on September 22, in Notice 2014-52.  The Notice announces forthcoming regulations that are targeted at reducing some of the perceived economic benefits of inverting.  The forthcoming regulations would apply primarily to companies which complete inversions on or after September...

Schumer-Durbin Target Earnings Stripping

The change from summer to fall did nothing to alter the focus of the Congressional tax debate – inversions.  To that end, two Senators have introduced a new bill on “earnings stripping.” Senators Charles Schumer (D-NY) and Dick Durbin (D-Ill.) introduced new legislation on September 11 that would significantly limit earnings stripping by inverted companies.  The...

State Legislators Getting in on Inversion Game

With numerous Congressional legislative proposals, and increasingly heated and political rhetoric, regarding corporate inversions, it was probably only a matter of time before state legislators entered the political fray. New Jersey state senator Shirley Turner (D-Mercer, Hunterdon) has proposed legislation which would deny certain state benefits to companies that have taken part in...

Repatriation Holiday in the Driver’s Seat?

Senator Harry Reid (D-Nev.) and Sen. Rand Paul (R.-Ky.) are in negotiations on a one-time repatriation “holiday,” which would allow U.S. corporations to repatriate foreign earnings at a special reduced rate.  No proposal has formally been released, but reports on the negotiations say that the rate would be between 5 percent and 9.5 percent.  The short-term revenue increase...

The Topsy Turvy Status of Inversions – Levins Move Forward, Wyden and Pfizer Move Back

Senator Carl Levin (D-Mich.) and 13 other Senate Democrats introduced legislation on May 20th that would significantly reduce the ability of U.S. companies to expatriate.  The Stop Corporate Inversions Act of 2014 would generally enact President Obama’s budget proposal targeting corporate inversions (see our prior post) by reducing from 80% to 50% the post-inversion ownership...

Senate Extenders Legislative Language Released

Almost a month after the Senate Finance Committee approved legislation which would extend expired tax provisions (see our prior post), Chairman Ron Wyden (D-Ore.) finally introduced in the Senate the legislative language of the bill.  S. 2260, the Expiring Provisions Improvement, Reform, and Efficiency Act of 2014, or the EXPIRE Act, was introduced on April 28, and the text is...

OECD Releases Discussion Draft on Treaty Abuse

On March 14, the Organisation for Economic Cooperation and Development (OECD) released a public discussion draft on Action 6 of its Base Erosion and Profit Shifting (BEPS) project, on how to prevent treaty abuse.  The discussion draft covers many issues, but five key recommendations stand out.  The first four are changes to the OECD Model Tax Convention itself (the “Model...

The IRS: Taking the “Coin” Out of Bitcoin

The IRS released guidance on March 25 that Bitcoins and other virtual currency should be treated as property for U.S. federal income tax purposes, and not as a currency.  In addition to the determination that virtual currency is property, the IRS notice made clear that some of the typical rules on transactions in property apply to virtual currencies.  For example, the recipient of...

Energy Tax Reform: Current Updates And What It Means For Companies In The Energy Sector

Energy tax reform has been the subject of three recent, and very significant, administrative and legislative proposals: The President’s 2015 budget, released on March 4, 2014; The comprehensive tax reform plan released on February 26, 2014, by Representative Dave Camp (R-Mich.), chairman of the House Ways and Means Committee; and The energy tax discussion draft released on December...

President’s Budget Targets Inversions

The Obama Administration has corporate “inversions” in its sights.  On March 4, the Administration’s 2015 budget was released, and it includes a provision which would significantly lower the ownership thresholds to keep “inverted” companies within the U.S. taxing power. The budget would make changes to section 7874, which was enacted in 2003 and targets “inversion...

Camp Goes All-In with Comprehensive Tax Plan: Highlights, Tax Reform Status and Impact on Taxpayers

On February 26, Representative Dave Camp (R-Mich.), chairman of the House Ways and Means Committee, released his much-awaited comprehensive tax reform plan (the “Camp Proposal”).  That proposal seeks to cut marginal tax rates on individuals and corporations by dramatically reducing the number of available deductions and credits, and proposes significant other changes to the tax...

President’s 2015 Budget Includes New Tax Proposals

On March 4, the President released the 2015 annual budget, which included both new and old tax proposals.  We will be posting further on some of these proposals, and the Administration’s entire explanation of the revenue proposals, aka the Greenbook, can be found here.

Camp Releases Comprehensive Tax Reform Plan

Representative Dave Camp (R-Mich.) has released a comprehensive tax reform plan.  Links to key materials are included here. The legislative text The section-by-section summary The executive summary The press release The Joint Committee on Taxation...

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