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Legal Alert: Warren bill fundamentally changes financial account reporting requirements and substantially increases IRS funding

On May 24, 2021, Sen. Warren introduced Senate Bill 1788, the “Restoring the IRS Act” (the Proposed Legislation). The Proposed Legislation generally (1) imposes new information reporting obligations on financial institutions relating to various types of transaction information associated with an account of an individual or business at that institution, (2) provides for significantly...

Legal Alert: Rev. Proc. 2021-26 provides accounting method change procedures for CFCs seeking to use the alternative depreciation system

Recently released Revenue Procedure 2021-26 (the Revenue Procedure) provides taxpayers with guidance regarding accounting method changes made on behalf of foreign corporations. The Revenue Procedure: Allows controlled foreign corporations (CFCs) to obtain automatic consent to change depreciation methods to use the alternative depreciation system under section 168(g) (ADS) (or...

State of play: A May methods update

At last week’s ABA May Tax Meeting, government attorneys from both the Internal Revenue Service National Office Income Tax & Accounting division (IT&A) and the Department of the Treasury provided updates to taxpayers and practitioners on the status of guidance projects, and offered clarification regarding certain recent legislative proposals. IT&A leadership acknowledged...

Treasury and IRS Release Final Regulations under Section 451

On December 22, the Department of the Treasury and the Internal Revenue Service released final regulations under section 451(b) and (c). Section 451(b) generally provides that a taxpayer must recognize income no later than when the taxpayer takes the income into account on its applicable financial statement, and section 451(c) provides rules regarding the timing of the recognition of...

Treasury and IRS Release Final Regulations on Full Expensing under Section 168(k)

On September 21, the Department of the Treasury and the Internal Revenue Service released final regulations under section 168(k). Amended by the Tax Cuts and Jobs Act, section 168(k) generally allows full expensing of certain depreciable property. The final regulations generally finalize proposed regulations released in 2019 that address the requirements to qualify for the additional...

Bill to Correct Qualified Improvement Property Glitch Fails to Gain Traction in the House

On Nov. 20, the House of Representatives failed to approve a motion that would have attached the Restoring Investment in Improvement Act (H.R. 1869) to the Workplace Violence Prevention for Health Care and Social Service Workers Act (H.R. 1309). H.R. 1869 would correct a drafting error in the Tax Cuts and Jobs Act changes to section 168 that prevents qualified improvement property from...

IRS Releases Final Regulations under Section 168(k)

Today, Treasury and the IRS released final regulations under section 168(k). Amended by the Tax Cuts and Jobs Act, section 168(k) generally allows full expensing of certain depreciable property. The final regulations address the requirements to qualify for the additional depreciation deduction and elections related to the deduction. Read the final regulations: TD 9874 Read the proposed...

OIRA Completes Review of Second Set of Proposed Regulations under Section 168(k)

The Office of Information and Regulatory Affairs (OIRA) recently completed its review of a second set of proposed regulations under section 168(k). Amended by the Tax Cuts and Jobs Act, section 168(k) generally allows full expensing of certain depreciable property. OIRA has not released information as to the contents of the proposed regulations, and the release of this set of proposed...

IRS Releases Proposed Regulations under Section 451

The IRS has released proposed regulations under section 451(b) and (c), which were amended by the Tax Cuts and Jobs Act. Section 451(b) generally provides that a taxpayer must recognize income no later than when the taxpayer takes the income into account on its applicable financial statement, and section 451(c) provides rules regarding the timing of the recognition of advance payments....

Treasury Releases Final and Proposed GILTI Regulations and Temporary Section 245A Regulations

On June 14, Treasury and the IRS (the Service) released final and proposed regulations on the new global intangible low-taxed income provisions, or GILTI, that were introduced under the Tax Cuts and Jobs Act. Along with finalizing regulations related to determining a US shareholder’s GILTI inclusion and their pro rata share of a CFC’s subpart F income, the regulations also address the...

Passthrough Regulations and Guidance Released

Final section 199A regulations and additional proposed rules concerning passthrough deductions were released on January 18. The final regulations concern the 20 percent business income deduction available to passthrough owners meeting certain income thresholds that was introduced under the Tax Cuts and Jobs Act (TCJA). Included in the final regulations are a technical definition of...

IRS Issues Final Transition Tax Regulations

On January 15, 2019, the IRS and Treasury released final regulations on the section 965 transition tax. The final regulations largely adopt the basic approach and the structure of the proposed regulations (REG-104226-18) issued on August 9, 2018 but with some changes, including modifications to the election to reallocate basis to reflect the offset of positive earnings with deficits...

Joint Committee on Taxation Releases Blue Book of TCJA

The General Explanation of Public Law 115-97, prepared by the staff of the Joint Committee on Taxation in consultation with the staffs of the House Committee on Ways and Means, the Senate Committee on Finance, and the Treasury Department’s Office of Tax Policy, was released this week. The explanation provides a discussion of the Tax Cuts and Jobs Act (TCJA) including a description of...

House Republicans Release Tax Package

House Republicans released a 297 page tax bill on the evening of November 26, with the possibility of voting on the proposed bill as soon as this week. The legislation includes a number of “extenders,” which would renew certain tax provisions set to expire; tax breaks for smaller businesses; and technical corrections to the Tax Cuts and Jobs Act (TCJA) passed in 2017. The five...

IRS Releases Business Interest Expense Proposed Regulations

The IRS has released proposed regulations (REG-106089-18) concerning the business interest expense deduction limits applied to certain taxpayers. As amended by the Tax Cuts and Jobs Act (TCJA), section 163(j) generally places a limit on the amount of deductible business interest expenses in a current taxable year. The proposed regulations, released on November 26, provide rules for...


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