The IRS issued proposed regulations providing that Sec. 956, which requires an income inclusion by U.S. shareholders of controlled foreign corporations (CFCs) that invest in U.S. property, should not apply to corporate shareholders.
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International Tax
Offshore account holders should beware: The IRS is still coming
Taxpayers with undisclosed offshore accounts would be wise to take advantage of the lesser known IRS voluntary disclosure process.
Association addresses digital economy tax issues
The Association of International Certified Professional Accountants released a policy paper urging global solutions to the tax treatment of transactions in the digital economy, emphasizing its own Guiding Principles of Good Tax Policy.
Tax reform: Individual taxpayers and the Sec. 962 election
The new “repatriation tax” under the TCJA may cause individual partners and shareholders of flowthrough entities to obtain a deferred tax rate benefit by making this election.
Reassessing the tax benefits of IC-DISCs
Due to TCJA tax rate differential changes, taxpayers may find that the tax benefits of using an IC-DISC
no longer outweigh the compliance and maintenance costs.
IRS issues Sec. 965 transition tax regs.
The IRS issued proposed regulations on the Sec. 965 transition tax that requires U.S. shareholders of deferred foreign income corporations to pay tax on post-1986 deferred income.
An old friend reconsidered: Post-TCJA Sec. 338(g) elections for foreign targets
the TCJA’s implementation of a hybrid territorial international tax regime mitigates the benefit of the election and may induce taxpayers to not make the election to avoid additional tax liability on the eventual sale of foreign target shares.
Different SALT flavors of mandatory deemed repatriation under Sec. 965
This item discusses new trends in states’ conformity with or decoupling from Sec. 965.
Regulatory fatigue? FATCA inaction may risk noncompliance
Financial institutions need to remain vigilant and periodically update their compliance systems to ensure they remain fully compliant with the law.
IRS issues proposed regs. for GILTI inclusions
The IRS issued proposed regulations implementing Sec. 951A’s global intangible low-taxed income provision, which requires a US shareholder of a controlled foreign corporation to include this income in the shareholder’s gross income.
Researchers and scholars claim tax treaty benefits
Three recent cases provide tips to decide if it’s worth the time and effort to appeal to the Tax Court.
IRS gives taxpayers penalty and late-election relief for Sec. 965 transition tax
The IRS announced relief from late-payment penalties and that it will allow late elections for taxpayers subject to the new Sec. 965 transition tax on deemed repatriated foreign earnings.
Foreign-derived intangible income deduction: Tax reform’s overlooked new benefit for U.S. corporate exporters
One new opportunity created by the TCJA is the foreign-derived intangible income deduction in Sec. 250(a).
Proposed regs. address several transition tax issues
The IRS issued proposed regulations on the Sec. 965 transition tax that requires U.S. shareholders of deferred foreign income corporations to pay tax on post-1986 deferred income.
The carrot-and-stick approach to on-shoring intangible value
This item discusses provisions of the TCJA that seek to curb the erosion of the U.S. tax base.
Amended Sec. 965 may provide a Sec. 382 benefit: Deemed repatriation and RBIG
This item explores whether the toll charge might
be treated as a recognized built-in gain under Sec. 382(h).
Tax reform legislation narrows insurance PFIC exception
A change to the Code limits the ability of shareholders of certain foreign insurance companies to avoid being subject to antideferral rules that apply to passive foreign investment companies.
New Sec. 960 ‘properly attributable to’ standard raises questions for Sec. 956 inclusions
Determining how to “properly attribute” a foreign
income tax to an income inclusion is unclear, particularly with respect to Sec. 956 inclusions.
‘Toll charge’ guidance may trigger capital gain on PTI distributions
This item discusses uncertainties regarding the
consequences of a midyear distribution
of PTI by a CFC.
Sec. 263A considerations when determining cost of goods sold excludable from BEAT
Appropriately capitalizable costs under Sec. 263A generally are not considered base-erosion payments
for purposes of the BEAT.
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.
