IRS Releases Priority Guidance Plan for 2018-2019
Posted on Nov 9, 2018 in Individual Taxation, International Tax, Pass-through Taxation, Tax Accounting
On November 8, the IRS and Treasury Department released their priority guidance plan (PGP) for 2018-2019, which includes a number of projects concerning the implementation of the Tax Cuts and Jobs Act. Planned projects include finalizing regulations under sections 199A (the 20% deduction for qualifying business income) and 951A (global intangible low-taxed income) and issuing...
BEAT Regulations submitted to OMB
Posted on Nov 7, 2018 in International Tax
The IRS has submitted its proposed base erosion and anti-abuse tax (BEAT) regulations to the U.S. Office of Management and Budget for review. Under section 59A of the Tax Cuts and Jobs Act (TCJA), the BEAT is an alternative minimum tax on income with deductions for payments between U.S. corporations and their foreign affiliates added back, which is designed to limit shifting of...
OMB Receives Proposed Foreign Tax Credit Regs for Review
Posted on Nov 7, 2018 in International Tax
The Office of Management and Budget (OMB) received proposed foreign tax regulations for review on November 7. The regulations include guidance on allocation of expenses to the section 951A Global Intangible Low-Taxed Income (GILTI) basket for purposes of determining the foreign tax credit limitation, as well as transition rules for excess foreign tax credit carryforwards. The...
OIRA Receives Proposed Section 163(j) Regulations for Review
Posted on Oct 26, 2018 in Individual Taxation, International Tax, News, Pass-through Taxation, Tax Accounting
The Office of Information and Regulatory Affairs (OIRA) received draft proposed regulations under section 163(j), addressing the limitation on business interest deductions, on October 25, according to the Office of Management and Budget’s website. As amended by the Tax Cuts and Jobs Act (TCJA), section 163(j) generally limits business interest expense deductions to the sum of business...
IRS Releases Opportunity Zone Guidance
Posted on Oct 19, 2018 in Individual Taxation, Pass-through Taxation
On October 19, 2018, the IRS released proposed regulations (REG-115420-18) concerning opportunity zones (sections 1400Z-1 and 1400Z-2). Opportunity zones were created by the Tax Cuts and Jobs Act and allow tax benefits for investments in low-income communities, through what are termed qualified opportunity funds. Among other items, the proposed regulations provide taxpayers with...
Proposed Foreign Tax Credit and Section 163(j) Regulations to be sent to OIRA
Posted on Oct 19, 2018 in International Tax
On October 18, 2018, Lafayette G. Harter III, the deputy assistant secretary for international tax affairs for the Department of Treasury, announced that the proposed regulations focusing on foreign tax credits under section 904 are likely to be sent to the Office of Information and Regulatory Affairs (OIRA) for review on October 19 or the following week. Harter also announced that...
Treasury Confirms Issuance of Transition Tax Regulations by the End of the Year
Posted on Oct 11, 2018 in International Tax
Brenda Zendt, special adviser to the Treasury Office of International Tax Counsel, corroborated a prior report that the Treasury Department intends to issue final Section 965 regulations by the end of 2018. Treasury deputy assistant secretary for international tax affairs, Chip Harter, previously commented on the deadline while discussing Treasury’s goal to issue proposed regulations,...
Proposed GILTI Regulations to Be Published in Federal Register
Posted on Oct 8, 2018 in International Tax
The proposed regulations for the global intangible low-taxed income (“GILTI”) under section 951A (REG-104390-18) are set to be published in the Federal Register on October 10. Released on September 13, the regulations set forth new reporting requirements and rules for calculating GILTI inclusions. Public comments on the proposed GILTI regulations must be received by December 9. 2018,...
House Approves Three New Tax Bills
Posted on Sep 28, 2018 in Individual Taxation, News
On September 27, 2018, the House approved two bills that are part of a second package of tax law changes advanced by House Republicans (“Tax Reform 2.0”). The first bill would create universal savings accounts, expand the utility of section 529 education savings plans, and make the offering of employee retirement plans more accessible for small businesses. The second bill would provide...
Legal Alert: Real estate unlocked: Opportunity zones offer tax incentives to investors
Posted on Sep 7, 2018 in Legal Alerts, Uncategorized
As part of the Tax Cuts and Jobs Act of 2017, Congress added new rules to the Internal Revenue Code intended to promote investments in low-income communities designated as “qualified opportunity zones.” Deferral of tax on gains reinvested in Opportunity Funds and reduction or elimination of tax on such investments held for extended periods are the OZ Program’s carrots. Qualifying real...
Proposed GILTI Tax Regulations are Currently Under Review by the OMB
Posted on Aug 23, 2018 in International Tax, News
According to the Office of Budget and Management (OMB) website, the proposed regulations on section 951A were received on August 22, 2018 and are currently under review. Section 951A, a provision added by the Tax Cuts and Jobs Act, addresses the inclusion of global intangible low-taxed income by United States shareholders. Notice on OMB Website: Pending EO 12866 Regulatory...
Section 168(k) Administrative Solutions Possible for QIP Error; Partnership Remedial Allocations
On August 16, the Senate Finance Committee sent a letter to Treasury clarifying the drafting error in the Tax Cuts and Jobs Act that failed to make qualified improvement property (QIP) eligible for 100% bonus depreciation under section 168(k). Ellen Martin, a tax policy adviser in the Treasury Office of Tax Legislative Counsel, commented that the letter was welcome but may not be...IRS Releases Interim Guidance for Unrelated Business Taxable Income
Posted on Aug 21, 2018 in Individual Taxation, News
The IRS released Notice 2018-67, which provides interim guidance addressing section 512(a)(6). Section 512(a)(6), added by the Tax Cuts and Jobs Act, requires a taxpayer to calculate its unrelated business taxable income separately for each unrelated trade or business in which the taxpayer is engaged. In determining whether a taxpayer has more than one trade or business, the Notice...
Regulations on Bonus Depreciation Are Mostly as Expected
Posted on Aug 7, 2018 in News, Tax Accounting
The proposed regulations addressing section 168(k) bonus depreciation largely conform to expectations, however there were a few unanticipated elements. In her recent comments to the press, Ellen McElroy of Eversheds Sutherland (US) LLP highlighted the IRS’ failure to address the drafting error that left qualified improvement property ineligible for bonus depreciation. McElroy also...
Proposed Regulations on Contribution Limits for ABLE Act Anticipated
Posted on Aug 6, 2018 in Individual Taxation, News
According to recently released Notice 2018-62, the IRS and the Treasury will issue proposed regulations to clarify the new rules regarding the Achieving a Better Life Experience (ABLE) Act. The ABLE program provides tax-advantaged savings accounts for individuals with disabilities. The TCJA increased the contribution limit to ABLE accounts under certain circumstances. The proposed...