These new rules aim to curtail an inverted company’s ability to access foreign subsidiaries’ earnings without paying U.S. tax.
Tax authorities in various countries announced the launch of investigations after 11.5 million documents were leaked from a Panamanian law firm that specializes in setting up offshore entities.
Heightened tax compliance efforts worldwide make this a good time to review the complicated rules that apply to reporting foreign accounts on FinCEN Form 114, Report of Foreign Bank and Financial Accounts, commonly known as FBAR.
This sidebar provides a brief explanation of the Internal Revenue Code’s effectively connected income (ECI) rules that may impose direct U.S. tax on certain income earned by any foreign corporation.
The much-anticipated rules, under which the US would adopt the Organisation for Economic Co-operation and Development’s country-by-country reporting regime, would require reporting by multinational enterprise groups with revenue of $850 million or more in the prior annual accounting period.
Proposed regulations under Sec. 2801 would impose a transfer tax on gifts or bequests from covered expatriates made on or after June 17, 2008.
Maximum penalties for willful failure to report foreign bank accounts on FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR), for multiple years are limited under new IRS procedures.
Refunds of tax withheld under chapters 3 and 4 will be limited to the amounts actually deposited.
Planning to lessen estate, gift, and generation-skipping transfer taxes increasingly requires considering clients’ foreign connections.
A taxpayer’s strong ties to the United States led to denial of the foreign earned income exclusion despite his spending half his time living and working overseas.
The IRS has proposed to amend its regulations to limit refunds paid to beneficial owners of withheld payments to amounts actually deposited by withholding agents.
The IRS issued regulations under Sec. 909 regarding the foreign tax credit splitter rules.
The regulations provide an exception for dual-resident taxpayers taxed as residents of a treaty partner country; IRS requests comments on virtual currency.
The IRS finalized temporary regulations issued in 2012, called anti-splitter rules because they aim to prevent foreign income from being inappropriately split from foreign tax in calculating the foreign tax credit.
The IRS stated that it intends to keep its Offshore Voluntary Disclosure Program open until it announces otherwise.
Final regulations issued on Thursday explain how taxpayers whose specified foreign financial assets are great enough to trigger the Sec. 6038D reporting requirement can comply with the rules.
Scam artists impersonating the IRS have been requesting foreign financial account holders’ personal and account information, the IRS warned in a news release.
Coming regulations will reduce tax benefits of inversions by preventing certain uses of controlled foreign corporations and closing loopholes in the Sec. 7874 anti-inversion provisions.
The IRS announced its intention in Notice 2014-59 to amend temporary regulations it issued under the Foreign Account Tax Compliance Act (FATCA) on March 6, 2014, to modify the effective dates of (1) the standards of knowledge that apply to a withholding certificate or documentary evidence to document a payee
The IRS updated its streamlined offshore compliance program to provide procedures taxpayers residing both inside and outside the United States should use to participate in the program. The streamlined offshore compliance program is for taxpayers whose failure to comply with requirements to report offshore assets is nonwillful. It is designed