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.
International Tax
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.
Virtual currency update
Treasury takes a more aggressive stance on reporting of virtual currency transactions.
Penalty relief for Forms 5471, 5472, and 8865
Various options are available for mitigating penalties for noncompliance with foreign return filing requirements.
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.
Transfer pricing and sales/use tax
This discussion outlines the basics of sales and use tax and transfer pricing, considers how intercompany transfer pricing may unintentionally lead to sales tax exposure, and offers steps to avoid audit assessments and penalties.
IRS finalizes rules for 100% dividends-received deduction, GILTI
The IRS issued final rules on the Sec. 245A extraordinary disposition rule and the Sec. 951A disqualified basis and disqualified payment rules, as well as reporting requirements to facilitate the rules.
GILTI and Subpart F treatment of distributions of appreciated property
Under the Subpart F regime, income subject to the regime is initially defined by what it includes, while under the GILTI regime, income subject to the regime is initially defined by what it excludes. This article discusses the application of these different approaches in the context of nonliquidating distributions from a controlled foreign corporation to a U.S. shareholder.
Refundable credits and foreign tax credits
This item discusses how new rules would affect taxpayers’ ability to claim FTCs for foreign income taxes that are offset with refundable tax credits in a foreign jurisdiction.
Transfer pricing and the pandemic recession: What to do about it
MNEs will need to reevaluate their pre-pandemic transfer-pricing approach based on an updated application of the arm’s-length principle and be prepared to defend changes in the approach and results.
Bridging the gap: GILTI and AAA
IRS Notice 2020-69 provided a new entity election that allows an S corporation to compute the deemed inclusions at the entity level, as opposed to at the shareholder level. This item provides background on the new election, illustrates its effects, and highlights opportunities and traps to consider when contemplating the election.
IRS memorandum illustrates application of Sec. 704(c) anti-abuse rule
In FAA 20204201F, the IRS concluded that the Sec. 704(c) allocation method adopted by a partnership between a U.S. corporation and its domestic and foreign affiliates was unreasonable under the Sec. 704(c) anti-abuse rule.
Reducing the threat of double taxation from GILTI gap period rules
This discussion summarizes proposed regulations that would coordinate two sets of rules that apply to extraordinary dispositions and disqualified transfers of property.
