Proposed regulations would harmonize dual consolidated losses with the Organisation for Economic Co-operation and Development’s Global Anti-Base Erosion Model Rules.
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International Tax
IRS FAQ clarifies sunset of Notice 2010-46 credit forward framework
Frequently asked questions on Foreign Account Tax Compliance Act compliance now address a method for correcting overwithholding on dividends.
No Collection Due Process hearing for FBAR penalties
A hearing is available only for taxes imposed by Title 26, the Internal Revenue Code, as opposed to the taxpayers’ foreign bank account reporting penalties under U.S. Code Title 31, the Tax Court held.
New prop. regs. limit taxpayers’ foreign currency elections
The regulations would promote consistency with filing requirements for controlled foreign corporations and limit certain elections regarding foreign currency gains and losses.
CRFB leader: Tax policy may not be a Trump administration high priority
The head of the nonpartisan Committee for a Responsible Federal Budget told the AICPA & CIMA National Tax Conference that extending the Tax Cuts and Jobs Act would add $5 trillion to the national debt.
Sec. 245A dividends-received deduction allowed for Sec. 78 dividend
In Varian Medical Systems Inc., the Tax Court found the company eligible for the deduction for 2018 despite a disqualifying change in Sec. 78, due a mismatch between the change’s effective date versus the effective date of then-new Sec. 245A.
Implications of the Supreme Court’s Moore decision
The Moore decision could support other forms of recognition of undistributed earnings by entities to their shareholders or members, particularly in the international sphere, as well as new proposed taxes on other forms of wealth.
FBAR penalties can violate Excessive Fines Clause
Because penalties for failure to report foreign bank and financial accounts reports are punitive in nature, they can violate the clause in the Eighth Amendment, the Eleventh Circuit held in Schwartzbaum.
Capital gains treatment for dividends from foreign corporations
Determining qualified dividend income from foreign corporations may require examining tax treaties and U.S. statutory exclusions, as well as studying the potential effect of pending regulations.
Bidding farewell to US citizenship: Understanding the exit tax
Potentially costly and far-reaching tax liabilities of covered expatriates should give individuals pause before renouncing U.S. citizenship or permanent resident status.
Pillar Two and nonprofit organizations
Although the Organisation for Economic Co-operation and Development’s Inclusive Framework on Base Erosion and Profit Shifting excludes nonprofit organizations, they may be subject to the rules if a subsidiary or group member engages in a trade or business.
Mandatory repatriation tax is constitutional
In Moore, the Supreme Court rebuffed a challenge to the one-time Sec. 965 tax on undistributed earnings of controlled foreign corporations attributed to U.S. shareholders.
Regulations create a new approach to the creditability of foreign taxes
Despite foreign tax credit guidance in recent years, questions remain regarding the Organisation for Economic Co-operation and Development’s Pillar 2 top-up taxes and related concerns.
Foreign partnership reporting requirements
U.S. persons owning an interest in a foreign partnership may be required to file Form 8865, and the partnership may also face additional U.S. filings.
Revisiting FIRPTA and return-of-capital distributions
Although the Foreign Investment in Real Property Tax Act applies to foreign holders of U.S. real property interests, U.S. real property holding corporations also may find it advantageous to apply for a withholding certificate.
Supreme Court issues narrow opinion upholding Sec. 965 transition tax
The Supreme Court upheld the mandatory repatriation tax as a valid exercise of Congress’s taxing authority. The Court did not reach the question of whether income must be realized to be taxable.
Taxpayer-initiated transfer pricing adjustments in MAP
When multinational enterprises proactively initiate transfer pricing adjustments to avoid penalties or for other reasons, a tax treaty’s mutual agreement procedure (MAP) can help prevent double taxation, but additional issues should be considered.
IRS steps up enforcement of the individual expatriation tax
The Sec. 877A exit tax applies to specified expatriating U.S. citizens and long-term residents on gains from a deemed sale of assets. Expatriates’ numbers have risen, and the IRS is emphasizing compliance.
E-invoicing mandates and intercompany transactions
Value-added tax increasingly entails mandatory use of electronic invoicing and other “continuous transaction control” systems — even for intercompany transactions.
Trends in enforcement of VAT remote-seller rules
Guidelines have emerged for assessing value-added taxes in the global digital economy, although jurisdictions employ their own approaches to enforcing them.
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.
