OIRA Receives Foreign Partner Sales Regulations
Posted on Dec 5, 2018
On December 4th the Office of Information and Regulatory Affairs (OIRA) received regulations pertaining to the treatment of foreign partners’ gains on the sale of a U.S. partnership. The regulations will provide guidance on section 864(c)(8), enacted by the Tax Cuts and Jobs Act, which treats gain from the sale of an interest in a partnership engaged in the conduct of a U.S. trade or business as effectively connected with the conduct of that business, overriding the Tax Court’s decision in Grecian Magnesite Mining. The regulations are anticipated to address treatment of partial sales of...
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IRS Releases Proposed Foreign Tax Credit Regulations
Posted on Nov 29, 2018
On November 28, the IRS released proposed regulations (REG-105600-18) concerning the treatment of foreign tax credits and related issues taking into account the changes made by under the Tax Cuts and Jobs Act (TCJA). Foreign tax provisions under the TCJA modified the method for calculating taxable income for purposes of the foreign tax credit limitation; added two additional foreign tax credit limitation categories, for amounts includible under the new Global Intangible Low-Taxed Income (GILTI) provisions of the TCJA and foreign branch income; and repealed the pooling concept for computing...
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House Republicans Release Tax Package
Posted on Nov 28, 2018
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 technical corrections included in the legislation would address legal expenses incurred by sexual harassment victims; provide guidance on the effective date of net operating loss provision modifications; address the...
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IRS Releases Business Interest Expense Proposed Regulations
Posted on Nov 27, 2018
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 calculating the business interest expense limitations in international, partnership, and consolidated group contexts, among other items. The proposed regulations further provide that certain trades and businesses,...
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OIRA Receives Section 267A Regulations for Review
Posted on Nov 16, 2018
The IRS on November 13th submitted its proposed section 267A anti-hybrid regulations to the Office of Information and Regulatory Affairs for expedited review. Section 267A of the Tax Cuts and Jobs Act, eliminates deductions for any “disqualified related party amount” paid or accrued through a related hybrid entity or transaction. The regulations are expected to address such issues as conduit arrangements, multiple tax residences, structured transactions, and payments subject to a preferential tax regime or participation exemption system. Read more: Proposed Regulations on Hybrid Mismatches...
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Single Entity Can Apply 199A De Minimis Rule Multiple Times, According to IRS Official
Posted on Nov 15, 2018
Speaking at the American Institute of CPAs Fall Tax Division Meeting in Washington, D.C. on November 14, IRS associate chief counsel Holly Porter stated that the section 199A de minimis test applied to identify specified service businesses could apply multiple times for the same entity if separate businesses are being operated. Enacted by the Tax Cuts and Jobs Act (TCJA), section 199A allows for a 20 percent deduction for certain passthrough business owners. Porter explained that one passthrough could maintain separate records for each business within the entity and apply the de minimis...
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Eversheds Sutherland Seattle CPE Day – Navigating The Changing World of Tax – Day 2, November 7, 2018
Posted on Nov 15, 2018
Please view our presentations from day 2 of our Seattle CPE Day on federal and international tax planning. Hard Knock Life: The New Worldwide Territoriality and the Continuing Significance of the Foreign Tax Credit in the US – Speakers, Randy Buchanan and Robb Chase On to the Next One: The Increasing Importance of Destination in Tax Regimes – Speakers, Michele Borens, Randy Buchanan and Daniel Nicholas Encore: Marketplace Collection – All Things Marketplace Plus the Kitchen Sink – Speaker, Michele Borens
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Eversheds Sutherland Seattle CPE Day – Navigating The Changing World of Tax – Day 1, November 6, 2018
Posted on Nov 15, 2018
Please view our presentations from our Seattle CPE Day on federal and international tax planning. 99 Problems: Planning in a Time of Tax Uncertainty – Speakers, Robb Chase, Randy Buchanan, Mary Monahan and Stefanie Wood Empire State of Mind: International M&A Post Tax Reform – Speakers, Daniel Nicholas and Jed Rogers Can’t Knock the Hustle: The Implications of International Reforms for Audit and Controversy – Speakers, Robb Chase, Randy Buchanan and Mary Monahan Dirt Off Your Shoulder: Addressing Ethics in a Time of Uncertainty – Speakers, Mary Monahan and Daniel...
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Eversheds Sutherland Year-End Tax Seminar – Navigating the Changing World of Tax, November 14, 2018, Philadelphia, PA
Posted on Nov 14, 2018
Please view our presentations from Eversheds Sutherland’s year-end tax seminar on federal and international tax planning. 99 Problems: Addressing Risk in a Time of Tax Uncertainty – Speakers, Ellen McElroy, Karl Zeswitz and Michael Resnick Can’t Knock the Hustle: The Implications of International Reforms for Audit and Controversy – Speakers, Mary Monahan and Robb Chase Holy Grail: Section 199A and Opportunity Zones – Speakers, Jamie Null and Karl Zeswitz Empire State of Mind: International M&A Post Tax Reform – Speakers, Taylor Kiessig and Jed Rogers Hard...
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IRS to Consider Changing Section 199A Aggregation Rules Based on Comments
Posted on Nov 13, 2018
IRS official Benjamin Weaver stated that the IRS is open to changing the aggregation rules set forth in the proposed section 199A pass-through deduction regulations since they are not “statutorily derived.” Weaver stated that the IRS has received numerous comments on the proposed regulations, particularly on the requirement that attributes of multiple businesses be aggregated at the individual level rather than the entity level. Weaver did not confirm that the IRS and Treasury would definitely revise the proposed regulations but stated that it will be “an area of focus” as they finalized the...
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IRS Releases Priority Guidance Plan for 2018-2019
Posted on Nov 9, 2018
On November 8, the IRS and Treasury Department released their priority guidance plan (PGP) for 2018-2019, which includes a number of projects concerning the implementation of the Tax Cuts and Jobs Act. Planned projects include finalizing regulations under sections 199A (the 20% deduction for qualifying business income) and 951A (global intangible low-taxed income) and issuing regulations for section 163(j) (the interest deduction limitation); sections 959 and 961 (previously taxed earnings and profits); and sections 901, 960, and 78 (foreign tax credits). In total, the PGP includes 239...
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BEAT Regulations submitted to OMB
Posted on Nov 7, 2018
The IRS has submitted its proposed base erosion and anti-abuse tax (BEAT) regulations to the U.S. Office of Management and Budget for review. Under section 59A of the Tax Cuts and Jobs Act (TCJA), the BEAT is an alternative minimum tax on income with deductions for payments between U.S. corporations and their foreign affiliates added back, which is designed to limit shifting of corporate income overseas through intangible property transfers. The regulations are expected to provide guidance on certain exclusions applicable to BEAT calculations, including the cost of goods sold exception and...
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OMB Receives Proposed Foreign Tax Credit Regs for Review
Posted on Nov 7, 2018
The Office of Management and Budget (OMB) received proposed foreign tax regulations for review on November 7. The regulations include guidance on allocation of expenses to the section 951A Global Intangible Low-Taxed Income (GILTI) basket for purposes of determining the foreign tax credit limitation, as well as transition rules for excess foreign tax credit carryforwards. The regulations are to receive expedited review, according to a Treasury official. Read more: Proposed U.S. Foreign Tax Credit Regs Submitted for OMB Review
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Treasury and IRS Issue Proposed Regulations for Section 956
Posted on Oct 31, 2018
Treasury and the IRS have issued proposed regulations (REG-114540-18) that would reduce the inclusion determined under section 956 for certain domestic corporations that own stock in controlled foreign corporations. The proposed regulations are intended to harmonize the application of section 956 and the participation exemption system (section 245A) enacted under the Tax Cuts and Jobs Act. Public comments on the proposed regulations are due within 30 days of their publication in the Federal Register. Read Proposed Regulations: REG-114540-18: Amount Determined Under Section 956 for...
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OIRA Receives Proposed Section 163(j) Regulations for Review
Posted on Oct 26, 2018
The Office of Information and Regulatory Affairs (OIRA) received draft proposed regulations under section 163(j), addressing the limitation on business interest deductions, on October 25, according to the Office of Management and Budget’s website. As amended by the Tax Cuts and Jobs Act (TCJA), section 163(j) generally limits business interest expense deductions to the sum of business interest income, 30% of adjusted taxable income, and floor plan financing interest. Existing questions regarding section 163(j) include how to allocate business interest between businesses that are exempt and...
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