The Office of Management and Budget Received Draft Transition Tax Regulations
Posted on Jul 17, 2018 in International Tax, News
On July 13, the Office of Management and Budget’s Office of Information and Regulatory Affairs (OIRA) acknowledged receipt on its website of proposed rules under section 965. The rules are currently under review, but OIRA has indicated that they are not economically significant, and therefore the normal 45-day review timeline (subject to extension) applies. Read more: Transition Tax...
Tax Reform 2.0 Not Expected to Address International Provisions
According to Republican Congressman Carlos Curbelo, tax reform 2.0 will not address international tax provisions, such as BEAT or GILTI. Instead, the next round of tax legislation is projected to focus on making the individual provisions permanent. The excluded provisions are expected to be addressed in a future, separate technical corrections bill. Curbelo also noted that the draft...Vote on Technical Corrections Bill Not Expected Until After Midterm Elections
Posted on Jul 13, 2018 in Individual Taxation, News
While House Republicans are in the process of drafting a technical corrections bill, House Republican leaders do not expect vote a on the bill until after the midterm elections in November. The technical corrections bill would be separate from the “phase 2” tax legislation that would make the individual tax cuts implemented by the 2017 tax act permanent. Kevin Brady, chairman of the...
European Commission Discussing Implementation of the TCJA with U.S. Officials
Posted on Jul 13, 2018 in Individual Taxation, News
According to Valdis Dombrovskis, a European Commissioner, the European Commission is speaking with U.S. officials about the Commission’s concerns with the 2017 tax act. European finance ministers have claimed that some provisions of the act violate international norms and double taxation treaties, especially the Base Erosion and Anti-Abuse Tax (or BEAT), which some commentators claim...
The White House Office of Management and Budget Has Not Yet Reviewed any New Tax Law Rules
Based on a new arrangement between the White House Office of Management and Budget (OMB) and Treasury, regulations and other guidance that have policy or economic significance will undergo a compliance review by the OMB. A senior administration official recently stated that Treasury and IRS have not yet sent any new tax regulations or guidance to the OMB for review, despite officials...Legislative Changes to the International TCJA Provisions to Be Considered
Posted on Jul 11, 2018 in Individual Taxation, News
In a recent interview, Kevin Brady, chairman of the House Ways and Means Committee, stated that legislative changes to the international provisions of the TJCA are in the works and that these changes may be included in the legislation associated with phase 2 of tax reform, which Brady indicated would be reviewed by House Republicans in July. President Trump has also weighed in on the...
LB&I Division Announces Campaign Targeting Transition Tax Compliance
Posted on Jul 5, 2018 in International Tax, News
On July 2, 2018, the Internal Revenue Service’s Large Business and International Division announced a compliance campaign focused on the transition tax provisions of section 965, enacted by the 2017 Tax Act. Section 965 generally requires that U.S. shareholders pay a tax on the untaxed foreign earnings of certain specified foreign corporations. The compliance campaign serves as a...
Six Main Areas Identified For TCJA International Guidance
Posted on Jul 5, 2018 in International Tax, News
In anticipation of tax reform 2.0, six major international areas have been identified as prime for regulatory focus and guidance: the allocation of expenses to GILTI income; the application of the accumulated earnings tax under section 531 to GILTI; treatment of consolidated tax return filers for GILTI purposes; potential carve-outs to the base erosion and anti-abuse tax (or BEAT);...
Phase Two of Tax Reform Will Retain Pretax Benefits of 401(k) Plans
Posted on Jul 5, 2018 in Employee Benefits, News
A spokesperson from the House Ways and Means Committee recently stated that the new tax proposals will not revise the pretax treatment of 401(k) savings plans. House Ways and Means Committee Chairman Brady previously stated, in an interview, that the phase 2 tax proposal might address retirement and include a savings element. Read More: Ways & Means Quashes Rothification Concerns...
Trump Anticipates Tax Reform 2.0 in October
Posted on Jul 2, 2018 in News
President Trump, during an interview with Fox Business Network’s Maria Bartiromo, stated that he expects another tax overhaul to be proposed in October. As part of the reform plan, President Trump is considering a further reduction of the recently enacted 21 percent corporate tax rate, to 20 percent. Read more here: Trump expects another tax overhaul, says ‘probably in...
Proposed Regulations and Guidance on Sections 199A and 163(j) Will Draw on Existing Regulations
Posted on Jun 29, 2018 in News, Pass-through Taxation
The IRS is incorporating relevant existing regulations in drafting the proposed regulations for sections 199A and guidance for section 163(j). However, as noted by Holly Porter, acting IRS associate chief counsel, there are limitations to the degree to which application of these two sections can rely on regulations already existing under other sections due to the differences in nature...
Brady Anticipates Legislative Outline of Tax Reform 2.0 in Early August
Posted on Jun 27, 2018 in Individual Taxation, News
House Ways and Means Committee Chairman Kevin Brady, at a Washington Post event held on June 26th, stated that Committee Republicans would begin circulating a draft of the next tax package after the July 4th holiday, followed by the release of an outline of the tax cut package in early August and a vote in the fall. Brady sees the next round of tax cuts as a package of multiple bills...
Proposed Regulations Related to Previously Taxed Income (PTI) Are Expected This Year
Posted on Jun 26, 2018 in International Tax, News
Marjorie Rollinson, IRS Associate Chief Counsel International, has indicated that issuing new proposed PTI regulations is a priority for the IRS this year. The new PTI regulations would address issues related to the global intangible low-taxed income (GILTI) and deemed repatriation provisions of the Tax Cuts and Jobs Act, specifically, how to allocate deductions against tested income...
Markup for Legislation for Phase 2 of Tax Reform Is Expected After August
Posted on Jun 26, 2018 in Individual Taxation, News
House Ways and Means Committee Chair Kevin Brady indicated that a new tax bill may be marked up after the August recess, a date later than his previous estimate. Brady also noted that parts of the phase 2 legislation may be pulled from previous Senate and House proposals. Read More: Phase 2 Markup Likely Delayed Until After August Recess
Congress Unlikely to Act on Technical Corrections until after November Elections
Posted on Jun 26, 2018 in Individual Taxation, News
Congress appears unlikely to pass a technical corrections bill for the Tax Cuts and Jobs Act prior to the November elections. Senate Majority Whip John Cornyn stated that the corrections are not imminent, and as an indication of further delay, Kevin Brady, Chair of the House Ways and Means Committee, has stated that any technical corrections will be affected by the guidance released by...