The IRS gets granular on new Section 864(c)(8), created by the Tax Cuts and Jobs Act. Our International Tax Group examines the implications of the newest proposed regulations brought on by tax reform. How Section 864(c)(8) codifies longstanding IRS principles on effectively connected income The proposed regulations’ complex formula for deemed partnership asset sales Application to tiered partnerships and treaties Read the full advisory here. [...]Read more
Our Unclaimed Property Group takes stock of the reprieve granted by the IRS in delaying new withholding and reporting requirements on IRAs remitted to states as unclaimed property. Effective date delayed until January 2020 Logistical and practical compliance issues A holiday treat for the financial services sector Read the full advisory here. [...]Read more
Our International Tax Group takes stock of new proposed regulations that try to keep Section 956 relevant despite the Tax Cuts and Jobs Act. Many were left scratching their heads “A result directly at odds with the manifest purpose of Section 956” Impact of the proposed regulations Read the full advisory here. [...]Read more
Some antique weapons are still dangerous; Section 269 could be one of them. Our Federal Tax Group explains why taxpayers facing Section 269 on audit should treat it seriously and what it reveals about the IRS’s hand. The three-part test Old, convoluted court opinions Is it as useful as the economic substance doctrine? Read the full advisory here. [...]Read more
The IRS’s opening salvo of proposed regulations under the Tax Cuts and Jobs Act’s global intangible low-taxed income is as complex as you would think. Our International Tax Group cuts through the clutter to address the key takeaways: Computation of GILTI inclusion Anti-abuse rules GILTI guidance still to come Read the full advisory here. [...]Read more
There is a disconnect between the statute and the regulation that impose penalties for violating FBAR filing requirements. Our International Tax Group covers the bases of the three court cases that have the IRS batting just 1 for 3. The 2004 statute can impose a penalty greater than $100,000 The regulation, which wasn’t updated, limits penalties to $100,000 Two courts favor the regulation; one the statute Read the full advisory here. [...]Read more
Our Federal Tax Group highlights Section 199A and the IRS’s new proposed regulations that allow pass-through businesses to deduct up to 20% of their qualified business income.
- Certain banks qualify for the deduction
- LLCs, partnerships, and S corporations can benefit
- Only productive businesses can take advantage
- Anti-abuse rules are built in
Read full advisory here.
Our International Tax Group discusses a recent case that offers a cautionary tale on statutory limitations periods and shows how even seemingly straightforward provisions are open to interpretation. 10 years vs. three years vs. two years? When is a refund “attributable to” foreign taxes? What does it mean to “pay” taxes? Read the full advisory here. [...]Read more
Many states have begun to treat IRAs as unclaimed property even before the owner can take a tax-free distribution. But now the IRS has ruled that escheatment is equivalent to a distribution and subject to federal income tax withholding and reporting requirements. Our Unclaimed Property Group dives into this dilemma for holders, owners, and states alike. Revenue Ruling 2018-17 concludes that escheatment of an IRA is a designated distribution Holders must honor federal tax withholding and reporting rules upon escheat States are aggressively auditing IRAs Potential negative impact on [...]Read more