Treasury and IRS Release Final and Proposed Regulations on Downward Attribution under Section 958(b)

On September 21, the Department of the Treasury and the Internal Revenue Service released final and proposed regulations addressing the repeal of section 958(b)(4) by the Tax Cuts and Jobs Act (TCJA). Prior to the TJCA, section 958(b)(4) provided that section 318(a)(3) (downward attribution) did not apply to treat a US person as owning stock owned by a person who is a not a US person. The final regulations generally modify provisions of the Code outside of subpart F and are intended to ensure that the provisions operate in a manner consistent with their operation prior to the repeal of section 958(b)(4). The proposed regulations modify the provisions of section 367(a) (transfers to a foreign corporation) and section 954(c)(6) (subpart F look-through rule) to generally apply the provisions in the same manner in which they applied prior to the repeal of section 958(b)(4).

Read More: Final Regulations

Read More: Proposed Regulations

Read More: 2019 Proposed Regulations

Back to top