Anti-splitter rules finalized


The IRS issued regulations under Sec. 909 regarding the foreign tax credit splitter rules. Under Sec. 909, if a foreign tax credit splitting event occurs with respect to a foreign income tax paid or accrued by a taxpayer, the taxpayer cannot take the foreign tax into account for federal income tax purposes before the tax year in which the taxpayer takes the related income into account (T.D. 9710). The new regulations finalize with a few minor clarifications the temporary regulations issued under Sec. 909 in 2012.

Included in the clarifications are changes to the definitions of reverse-hybrid splitter arrangements, loss-sharing splitter arrangements, and hybrid-instrument splitter arrangements and to the interim mechanical rules for tracking split taxes and related income. The preamble to the regulations notes that the regulations do not address other mechanical issues and that the IRS is still considering these issues and will address them in future guidance.

These final rules apply to tax years ending after Feb. 9, 2015.

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100th ANNIVERSARY

Black CPA Centennial, 1921–2021

With 2021 marking the 100th anniversary of the first Black licensed CPA in the United States, a yearlong campaign kicked off to recognize the nation’s Black CPAs and encourage greater progress in diversity, inclusion, and equity in the CPA profession.