Groups can effectively eliminate the intercompany gain in certain circumstances, thereby reducing the possibility of inadvertently triggering intercompany gain and freeing taxpayers from the need to plan transactions so as to avoid a trigger.
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Topics
Reporting & Filing Requirements
Timing of Deductions for Subsidiaries Joining a New Consolidated Return
Under the consolidated return rules, special considerations apply when a subsidiary member (Sub) joins or leaves a consolidated group during the tax year.
Bankruptcy and the Trust Fund Recovery Penalty
When a corporation fails to remit the withheld taxes to the government, the IRS looks through the corporation to the individual or individuals who are responsible for the failure.
Employment Tax Liability of Third-Party Agents Subject of Prop. Regs.
The IRS released proposed regulations under Sec. 3504 that would govern the liability for employment taxes when an employer designates an agent under a “service agreement” to pay its employees and to satisfy all employment tax obligations.
IRS Releases Final Regulations and Interim Guidance on Medical Device Excise Tax
Treasury published final regulations and additional interim guidance relating to the medical device excise tax.
Rev. Proc. Updates Guidance on Adequate Disclosure of Return Positions
The IRS released its annual update identifying when a taxpayer’s disclosure of an item or position in an income tax return is adequate for purposes of reducing the understatement of tax penalty and the tax return preparer penalty for understatement due to unreasonable positions.
Schedule UTP: IRS Findings
Recent data show what the IRS has found regarding Schedule UTP filings by corporations with $100 million or more of total assets on their tax return balance sheets, and what the IRS is doing with that information.
Application of the Consolidated Tax Return Rules to Insolvent Members
The tax treatment of an insolvent debtor realizing discharge of indebtedness income under the U.S. consolidated income tax return rules can vary considerably depending on the particular circumstances.
Preparing for the Medical Device Excise Tax
Taxpayers may face a number of unresolved issues in preparing to comply with the new excise tax on sales of medical devices.
Employment Tax Liabilities of Foreign Entities
A number of technical questions are involved in determining status as an employer for federal employment tax purposes when a foreign business sends individuals to work in the United States.
Sidestepping Deferred Intercompany Gain
This item illustrates how transfers of items outside a U.S. consolidated group can trigger a deferred intercompany gain and suggests ways to avoid that result in certain situations.
Section 530 Relief for Worker Classification Controversies
This article reviews the common law principles and authoritative guidance available to distinguish when workers are employees and the Section 530 safe-harbor provisions.
Flexibility for Intragroup Restructuring and Asset Transfers
Letter Ruling 201127004 reinforces the flexibility granted to taxpayers wishing to move assets around a qualified group without triggering gains or meeting the stringent qualifications of Sec. 355.
How Acquired Target Corporations Can Avoid Denial of Extension Requests
In some circumstances, C corporations can be surprised that the IRS denies their application for automatic extension of time to file when a consolidated return group parent company has acquired another consolidated return group.
Prop. Regs. Require NUBIG and NUBIL Redetermination for Consolidated Sec. 382 Purposes
The IRS recently proposed revisions to the consolidated return regulations on the application of Sec. 382 and calculation of net unrealized built-in gains and losses.
Annual Update on Adequate Disclosure of Return Positions Issued
The IRS released updated guidance identifying when a taxpayer’s disclosure of an item or position in an income tax return is adequate for purposes of reducing the understatement of tax penalty and the tax return preparer penalty for understatement due to unreasonable positions.
Final Regs. Simplify Reduced Research Credit Election
The IRS released final regulations (T.D. 9539) that further simplify an election method by which taxpayers may use a standard rate to reduce a research credit under Sec. 41 in lieu of reducing their research expense deductions. The final regulations also clarify how members of a controlled group may make the election. The final regulations adopt with some modification proposed regulations issued in 2009 (REG-130200-08).
Dispute Resolution Process for the 2011 Prescription Drug Annual Fee
This item describes the exclusive process available to covered entities to dispute the preliminary calculations of the annual fee on branded prescription drugs and obtain any change to data that would be reflected in the final fee allocation.
Employment Tax Consequences of a Corporate Change of Control Event
This item examines the employment tax consequences related to a corporate change of control event. Those consequences generally depend on the type of event, namely whether there is an asset purchase, a merger, or a stock acquisition.
IRS Applies Reverse Acquisition Regulations: A Substance-over-Form Approach
Determining whether a transaction is characterized as a reverse acquisition under the consolidated return regulations can be challenging. This item focuses on tax implications of reverse acquisitions and reviews recent private letter rulings in which the IRS applied substance-over-form principles.
INDIVIDUALS
Current Developments in Taxation of Individuals: Part 1
This update surveys recent federal tax developments involving individuals, including court cases, rulings, and guidance issued during the six months ending October 2025.
