The Build Back Better Act contains a large number of tax provisions, ranging from an extension of the advance child tax credit, to a wide variety of green energy tax incentives, and a minimum tax on corporations.
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International Tax
IRS provides new guidance on accounting method changes for CFCs
For a limited time, the IRS is allowing automatic change procedures for CFCs changing to the ADS method and has clarified the process and certain aspects of audit protection.
Tax treaties do not provide a foreign tax credit against net investment income tax
A U.S. taxpayer living abroad was not entitled to take a foreign tax credit against her net investment income tax based on provisions in the United States–France and United States–Italy tax treaties.
Foreign taxes on PTEP can provide additional foreign tax credits
This item focuses on the potential increase in the Sec. 904(a) foreign tax credit limitation when PTEP
is distributed by a CFC to its corporate “U.S. shareholder.”
Penalty for failure to report distribution from foreign trust not reduced
The penalty for failure to report a distribution from a foreign trust is not reduced when the trust beneficiary is also the trust owner.
Automatic procedures to change a CFC’s depreciation method
The IRS issued Rev. Proc. 2021-26, which contains procedures for certain foreign corporations to obtain automatic consent to change their methods of accounting for depreciation to the alternative depreciation system.
Foreign notional interest regimes may hinder deductions of US subsidiaries
Inbound structures involving interest or royalty
payments by U.S. subsidiaries to foreign affiliates may trigger anti-avoidance rules where the foreign affiliates operate in countries that have notional interest deduction tax regimes.
Final regs. issued on qualified improvement property under FDII, GILTI
Final regulations clarify the treatment of qualified improvement property in FDII and GILTI, and foreign tax credit transition rules address post-2017 NOL carrybacks to pre-2018 tax years.
Foreign-derived intangible income: Issues and practical strategies
This article discusses issues that have evolved around FDII where there has been little guidance and outlines ways to better take advantage of the FDII regime.
Court says statutory language precludes substance-over-form analysis
The plain language of the statute allowed taxpayers to shelter income from all tax using a foreign sales
corporation and Roth IRAs.
PFIC considerations for non-US SPACs
As SPAC activity has increased, non-U.S.-domiciled
SPACs have become more prevalent and carry major U.S. tax-compliance ramifications due to their potential treatment as a PFIC for U.S. investors.
Failure-to-deposit penalty when tax is not withheld on payments of US-source income
This item provides an overview of potential penalties and presents an argument as to why the
Sec. 6656 failure-to-deposit penalty may not apply in some instances.
Penalty relief for Forms 5471, 5472, and 8865
Various options are available for mitigating penalties for noncompliance with foreign return filing requirements.
Virtual currency update
Treasury takes a more aggressive stance on reporting of virtual currency transactions.
Transfer price adjustments don’t necessarily increase import duty costs
Importers should consider transfer-pricing arrangements in advance, based on the totality of the circumstances, to assess any potential refund of duties on adjusted prices to imported goods.
Unintended consequences of foreign branch reporting
Certain U.S. citizens and U.S. residents doing business abroad can have surprising tax reporting obligations as a consequence of the IRS’s revised instructions to Form 8858.
Foreign financial asset filing requirements: Coming into compliance
This article summarizes the options available to taxpayers to come into compliance with FBAR and information reporting obligations.
Sec. 1446(f) regulations: The rules and unanswered questions
This article addresses certain aspects of the withholding rules of the final Sec. 1446(f) regulations, options to eliminate or reduce Sec. 1446(f) withholding, and some outstanding issues.
COD income and cross-border considerations
This item provides an overview of the federal tax rules that apply to debt modifications and restructurings, with a primary focus on how U.S. corporate shareholders of CFCs are affected.
Assessment statutes of limitation and the Sec. 965 transition tax
As the IRS focuses more attention on Sec. 965, it is vital that taxpayers with Sec. 965 tax liabilities and their advisers understand the potentially applicable periods of limitation on assessment.
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.
