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Resignation of Treasury Official Expected to Result in Guidance Delays

Treasury Deputy Assistant Secretary of Tax Policy Dana Trier stepped down from his position on February 23. Trier’s role focused on developing guidance on various aspects of the new tax reform law, including the partnership and international tax provisions. Practitioners have expressed concern that his departure will result in delays in issuing regulations, which could result in...

Treasury Considering Treatment of Foreign Taxes Under Transition Tax

Under the new Tax Act, U.S. shareholders are charged a one-time tax on deferred foreign earnings of their foreign subsidiaries; these earnings and profits are measured as of November 2 if the amount is greater than on December 31.  Taxpayers have brought to Treasury’s attention that the use of the November 2 date can result in an overstatement of earnings because foreign taxes...

The Treasury Department Anticipates Releasing a Notice on IRC 163(j) in the Near Future

Krishna Vallabhaneni, Treasury deputy tax legislative counsel, recently stated that the Treasury Department plans on issuing a notice in the coming weeks to address some of the recent issues related to amended IRC 163(j) (interest expense deductions). Some of the specific issues the notice will address include the treatment of carryovers and limitations under the previous section...

EU Finance Ministers Debate the EU’s Response to the 2017 Tax Act

Finance ministers from key EU countries, including France, Germany and Italy, are questioning whether some of the provisions of the 2017 tax act are contrary to World Trade Organization (WTO) rules. The finance ministers are currently reviewing whether to file a complaint with the WTO out of concern that the tax act will spark a race to the bottom with respect to tax rates. EU finance...

Eversheds Sutherland Releases Videocast on the Interest Deduction Limitation under Section 163(j)

Eversheds Sutherland (US) LLP recently released a videocast covering the broadly applicable limitation on the ability to deduct interest under Section 163(j), enacted as part of the recent tax act. This short video includes an overview of the limitation, the differences between the current and prior limitation, and the exceptions to the limitation. Listen to the video:  The Interest...

Eighteen Guidance Priorities and New Projects Released in Second Quarter Update to Priority Guidance Plan

The second quarter update to the 2017-2018 Priority Guidance Plan was released by the Treasury and IRS this past Wednesday. It sets forth eighteen priorities for guidance on tax issues stemming from the Tax Act, including for new sections 965 and 163(j), and other international sections. The update also contains projects that are hoped to be completed through June 30, 2018. These...

Videocast: Eversheds Sutherland Releases Videocast on the new BEAT provision

Eversheds Sutherland (US) LLP recently released a videocast, discussing the new Base Erosion and Anti-Abuse Tax (“BEAT”). This brief video walks through an example of how BEAT would be calculated. View it here: Tax Reform: Base Erosion and Anti-Abuse Tax (BEAT)...

Eversheds Sutherland Releases Videocast Providing a Basic Overview of International Tax Provisions

Eversheds Sutherland (US) LLP recently released a videocast which provides a brief overview of the impact of international tax provisions. This short video provides a concise overview of various international provisions in the recent legislation formerly known as the Tax Cuts and Jobs Act, including those related to the reduced corporate tax rate, the shift to a hybrid...

White House Requests $90 Million Funding for Implementation of Tax Cuts and Jobs Act

Congress is expected vote on a funding bill this week to avoid a government shutdown. President Trump has requested that $90 million be added to the bill to fund the IRS’s implementation of the Tax Cuts and Jobs Act. This amount falls short of the $397 million that the Treasury Department had estimated it would cost for the IRS to respond to the Act. Read more:  House GOP Scrambles to...

Regulations and Notices to Provide Guidance on New Tax Bill

As the early guidance period for the new tax bill continues, the Treasury and IRS plan to shift to focusing on developing regulations over the next six months. A less notice-oriented approach is expected, with only five to ten limited-scope notices addressing basic questions, such as section 163(j) business interest issues, anticipated. IRS and Treasury tax reform projects will be...

Chamber of Commerce Provides Feedback on Notice 2018-07

The U.S. Chamber of Commerce recently released recommendations for further guidance in response to Notice 2018-07, which provides guidance related to section 965 (the transition tax on deferred foreign earnings). The recommendations include excluding short-term loans from foreign affiliates to a U.S. parent from aggregate foreign cash if they have previously triggered a taxable...

Treasury Department Releases Notice 2018-13, Providing Additional Guidance on Section 965

The IRS and Treasury Department have issued additional guidance regarding the transition tax imposed by the tax law’s new section 965. In addition to providing background information on section 965, Notice 2018-13 states that future regulations will be introduced to address: factors for determining a specified foreign corporation; an alternative method for calculating post-1986...

Speaker Ryan Foresees only Technical Corrections to the Tax Reform Bill, Rather Than Major Changes

In an interview with C-SPAN, House Speaker Paul Ryan stated that the bill previously known as the Tax Cuts and Jobs Act would require some technical corrections, such as in the area of international taxation, though he did not offer further details. He anticipates that any corrections to the bill would be small changes. House Ways and Means Committee Chair Keven Brady has also stated...

Broad Scope of “Cash” for Tax on Deferred Foreign Income Impacts Financial Sector

The new provision requiring that U.S. companies pay a 15.5 percent tax on deferred foreign earnings to the extent of cash and cash equivalents and a 8 percent tax on additional untaxed foreign earnings produces complications for the financial sector. Companies are reporting that the repatriation tax imposes a heavier burden on the financial sector because such companies typically hold...

CRS Report Analyzes 2017 Federal Tax System In Anticipation of Tax Bill Changes

The Congressional Research Service (CRS) published Report 7-5700 on December 26, 2017, which provides an overview of the federal tax system as in effect through 2017. The report notes that the new tax bill, H.R. 1, will generate broad changes for individuals (personal exemptions; standard deduction) and businesses (different tax rate for pass-through business income; territorial tax...


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