This item provides an overview of E&P of foreign corporations and several common misconceptions that directly affect E&P.
The regulations limit the application of the “active rents and royalties” exception to foreign personal holding company income, expanding the instances in which a controlled foreign corporation will be treated as holding U.S. property.
The IRS issued temporary and proposed regulations governing the treatment of property held by a controlled foreign corporation in connection with certain transactions involving partnerships.
Application of PTI rules to partnerships can be tricky, in part because domestic partnerships are treated as U.S. persons, but foreign partnerships are not. Therefore, a domestic partnership can be a U.S. shareholder of a CFC and entitled to a Sec. 961(a) basis adjustment for the CFC stock it owns, but a foreign partnership, even if owned by U.S. persons, is not so entitled.
Should gain recognized on a sale of a partnership that owns CFC stock be treated as capital gain or ordinary income?
The IRS issued final and proposed regulations amending the rules for filing Form 5472.
Previously taxed income rules were designed to prevent double taxation of a controlled foreign corporation's earnings. Keeping track of a foreign corporation's earings and profits under the rules can be complicated.
The IRS is amending the rules for filing Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business.
Foreign Corporations: Procedures and Pitfalls in Adopting and Changing Methods of Accounting for Purposes of Determining E&P
This item provides a high-level discussion of the general timing for certain foreign corporations’ adoption of methods of accounting for purposes of determining E&P, the procedural rules regarding how such foreign corporations change their method of accounting, and the importance of understanding when and how a method is adopted in light of the increased limitations such foreign corporations may face in changing methods.
The IRS addressed whether rental income from software leasing to third parties outside the country of a controlled foreign corporation is foreign personal holding company income.
The IRS late last year released final regulations on the rules for foreign base company sales income (FBCSI) under Sec. 954(a)(2) and Regs. Sec. 1.954-3(b).
The IRS issued temporary regulations relating to the treatment of upfront payments made pursuant to certain notional principal contracts for U.S. federal income tax purposes.
When a controlled foreign corporation (CFC) sells property used in its active business, any gain generally is not treated as subpart F income includible in its U.S. shareholders’ taxable income.
The IRS issued temporary regulations relating to the treatment of upfront payments made pursuant to certain notional principal contracts for federal income tax purposes.
When a U.S. company wants to reorganize a worldwide structure that includes Chinese entities, tax issues should be carefully considered to avoid any unforeseen Chinese tax liability.
This item examines the controlled foreign corporation (CFC) lookthrough rule.
The IRS issued temporary and proposed regulations to remove the duplicate filing requirement for Form 5472, Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business.
This article explores the tax consequences of using an offshore company to make more significant investments in foreign businesses, including situations in which the use of an offshore holding company may be consistent with bona fide U.S. federal income tax planning objectives.
This article provides an overview of the controlled foreign corporation anti-deferral regime as it relates to “portfolio-type investments” through a foreign holding company structure and the statutory deterrents to using such a structure.