Heather Ripley is an associate in the firm’s Federal & International Tax Group. Her practice focuses on federal and international tax services for a range of clients, including domestic and international business entities and individuals. Read More →
On January 18, 2017, the IRS issued temporary and proposed regulations (T.D. 9814) under section 721(c) to address transfers of appreciated property by U.S. persons to partnerships with related foreign partners. With some alterations, these regulations deliver on guidance announced in Notice 2015-54, released in August 2015 (see our prior coverage of Notice 2015-54 here). The regulations incorporate a number of taxpayer-friendly updates in response to comments on the Notice. The prospect of further direction in this area, however, including guidance under Sections 482 and 6662 as described in the [...]Read more
Our International Tax Group explores the final debt-equity regulations under Section 385, highlighting significant modifications to the rules proposed last April. While the regulations remain controversial, the final version brings a number of taxpayer-friendly changes, including a reduction in scope and general delay in application.
A recent Tax Court case shows the government’s willingness and ability to attack financing arrangements that do not reflect arm’s-length debt standards, even without the forthcoming Section 385 regulations. Our International Tax Group analyzes that case and reviews the IRS’s decision to stop treating some FATCA intergovernmental agreements as “in effect.”
Just a few key differences between U.S. proposed regulations on country-by-country reporting and the OECD’s BEPS recommendations are causing administrative headaches. Our International Tax Group minds the gap and explains what it means for U.S. multinationals.
In the wake of the Panama Papers leak, the IRS and Treasury have announced proposed regulations to require significant reporting by foreign-owned domestic disregarded entities. Our International Tax Group considers the implications of this anticipated regulatory burden.
The Protecting Americans from Tax Hikes Act of 2015 (the “PATH Act”), signed December 18, 2015, introduces significant changes to the Foreign Investment in Real Property Tax Act (FIRPTA), particularly concerning REITs. The reforms are generally intended to make foreign investment in U.S. real estate more attractive, though some revenue-raising measures are thrown in the mix.
Among the PATH Act's taxpayer-friendly FIRPTA updates:
The ownership threshold for foreign “portfolio investors” in publicly traded REITs increases from 5% to 10%. These investors are exempt from FIRPTA tax [...]Read more
Citing aggressive taxpayer positions, recently proposed regulations do away with the foreign goodwill exception to gain or income recognition for outbound transfers under Section 367. The rules also restrict the type of property eligible for the active business exception.
Reasons for Change
Per the preamble, taxpayers interpret Section 367 and the regulations in one of two ways when claiming favorable treatment of foreign goodwill and going concern value. One interpretation argues that goodwill and going concern value are not IP within the meaning of Section 936(h)(3)(B) and thus not subject [...]Read more
Beginning with foreign bank account reports (FinCEN Form 114, known as the FBAR) for the 2016 calendar year, FBARs will be due on April 15 of the following year. A six-month extension to October 15 will be available upon request.
FBARs of U.S. citizens and residents living abroad will be due on June 15 – with an additional four-month extension available to October 15. No additional two-month extension to December 15 will be allowed, however, as is permitted for the tax returns of U.S. persons living abroad.
These changes were part of the Surface Transportation and Veterans Health Care Choice [...]Read more