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OMB Begins Review of Final Regulations Regarding the GILTI High-Tax Exclusion

On June 16, Treasury submitted final regulations with respect to the proposed high-tax exclusion for global intangible low-taxed income (GILTI) under section 951A, as well as proposed regulations under section 954(b)(4) relating to high-taxed subpart F income, to the Office of Management and Budget (OMB) for review. Among other items, the proposed version of the regulations offered...

OMB Begins Review of Proposed and Final Regulations Under Section 163(j)

On June 15, Treasury submitted final and proposed regulations to the Office of Management and Budget (OMB) for review. The IRS had indicated that the modifications to the regulations since OMB’s last review of the package reflect changes made to section 163(j) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Among other provisions, the CARES Act amended section...

IRS Releases Proposed Regulations on Like-Kind Exchanges

Today, the IRS released proposed regulations under section 1031, which provides nonrecognition treatment for certain like-kind exchanges of property. The Tax Cuts and Jobs Act (TCJA) limited the application of the provision to exchanges of real property. The proposed regulations would update the existing regulations under section 1031 to take into account the changes made to the...

IRS Issues Guidance on CARES Act changes to Section 163(j)

The IRS has issued Rev. Proc. 2020-22 to provide guidance to taxpayers applying the provisions of section 163(j), as amended by the CARES Act. Among other provisions, the CARES Act amended section 163(j) to allow taxpayers to deduct up to 50% of their adjusted taxable income (up from 30%), plus interest income and floor plan financing income, for taxable years beginning in either 2019...

CARES Act Amends TCJA Provisions

On March 27, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act. While the Act is primarily focused on the coronavirus epidemic, the Act made a few significant changes to provisions enacted by the Tax Cuts and Jobs Act (TCJA). The Act: • Allows net operating losses (NOLs) arising in 2018, 2019, or 2020 to be carried back five years and exempts NOLs from the...

OMB Completes its Review of Proposed Regulations under Section 163(j)

The Office of Management and Budget (OMB) has completed its review of proposed regulations under section 163(j). Section 163(j) generally limits a taxpayer’s interest deduction to the sum of its business interest income, floor plan financing interest, and 30% of its adjusted taxable income. The IRS had previously stated that the proposed section 163(j) regulations would likely be...

OIRA Completes Its Review of Final 163(j) Regulations

On January 31, the Office of Management and Budget (OMB) completed its review of final regulations under section 163(j). Section 163(j) generally limits a taxpayer’s interest deduction to the sum of its business interest income, floor plan financing interest, and 30% of its adjusted taxable income. The IRS had previously stated that the final regulations would likely be released along...

Treasury and IRS Issue Final Regulations on Investing in Qualified Opportunity Funds

On December 19, Treasury and the IRS released final regulations regarding investments in opportunity zones under section 1400Z-2. Opportunity zones were created by the Tax Cuts and Jobs Act and allow tax benefits for investments in low-income communities, through what are termed qualified opportunity funds (“QOF”). The final regulations provide guidance on the ability of taxpayers to...

OMB Begins Review of Final Section 163(j) Regulations

The Office of Management and Budget (OMB) received final regulations under section 163(j) on December 17. Section 163(j) generally limits a taxpayer’s interest deduction to the sum of its business interest income, floor plan financing interest, and 30% of its adjusted taxable income. While the OMB website does not state whether the regulations are subject to expedited review, IRS...

Treasury and IRS Allow Domestic Partnerships and S Corporations to Apply Certain Proposed GILTI Regulations to Taxable Years Ending Before June 22, 2019

The Department of the Treasury (Treasury) and the IRS recently released Notice 2019-46.  The notice allows a domestic partnership or S corporation to apply Prop. Treas. Reg. § 1.951A-5 to taxable years ending before June 22, 2019, so long as the domestic partnership or S corporation meets the notification and reporting requirements described in the notice.  Prop. Treas. Reg. § 1.951A-5...

IRS Allows Election Relief for Bonus Depreciation

On July 31, 2019, the IRS issued Rev. Proc. 2019-33, which allows taxpayers to change their elections regarding bonus depreciation for property acquired after September 27, 2017 and placed in service during the taxpayer’s 2016 or 2017 taxable year. Under the revenue procedure, a taxpayer may make late elections to use bonus depreciation on such property or revoke its election to use...

OIRA Receives Proposed and Final Regulations under Section 168(k)

On July 25, 2019, the Department of Treasury and the Internal Revenue Service submitted final and proposed regulations under section 168(k) to OIRA (the Office of Information and Regulatory Affairs), which is part of the OMB (Office of Management and Budget). Amended by the Tax Cuts and Jobs Act, section 168(k) generally allows full expensing of certain depreciable property. The...

IRS Releases Proposed Regulations Addressing the Excise Tax on Certain Educational Institutions Under Section 4968

On June 28, 2019, the IRS released proposed regulations under section 4968. Section 4968 was added to the Code by the Tax Cuts and Jobs Act and generally imposes an excise tax of 1.4% on the net investment income of applicable educational institutions that have at least 500 tuition-paying students (of which more than 50% are located in the United States) and that have assets of at...

IRS Releases Proposed Regulations Addressing the FDII and GILTI Deduction under Section 250

On March 4, 2019, the IRS released proposed regulations under section 250. Section 250 generally allows a domestic corporation a deduction for its foreign-derived intangible income (FDII) and its global intangible low-taxed income (GILTI). The proposed regulations provide rules for determining the amount of the deduction, including guidance related to the provision’s taxable income...

Hearing on Proposed Regulations for Limitation on Deduction for Business Interest Expense – Treasury and IRS Hear Targeted, Industry-Specific Requests

On February 27, 2019, the Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) held a hearing on the proposed regulations for the section 163(j) limitation on deduction for business interest expense (the Proposed Regulations), which were released on November 28, 2018. Nine witnesses, including Eversheds Sutherland Partner Wes Sheumaker, provided a variety of...


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