I. Background and Overall Scope of Section 956 -
The overall purpose of section 956 is to tax investments made by CFCs in specified categories of “United States property” on a constructive dividend basis. The...more
The Federal Law No 376-FZ dated 24 November 2014 “Concerning the Introduction of Amendments to Parts One and Two of the Tax Code of the Russian Federation (Regarding the Taxation of the Profit of Controlled Foreign Companies...more
Last week, the Internal Revenue Service and Treasury Department announced a number of new regulations intended to make it more difficult to qualify for tax advantages associated with inversion transactions and reduce certain...more
The Internal Revenue Service (“IRS”) and Treasury Department issued Notice 2014-52 (the “Notice”) targeting corporate inversions on September 22, 2014 (the “Notice Date”) in the U.S. Tax considerations are important for...more
What is an inversion?
An inversion is a transaction that results in an existing U.S. company becoming a foreign company or becoming a subsidiary of a foreign parent. Historically, inversions involved U.S. companies...more
U.S. multinationals literally have trillions of dollars of untaxed earnings purportedly “trapped” offshore because of the associated high U.S. corporate income taxes that would be incurred if these earnings were repatriated...more
Each “U.S. Shareholder” of a controlled foreign corporation (“CFC”) is required to include in their gross income as a deemed distribution their pro rata share of the amount determined under section 956 for that year (i.e.,...more
Building on an undercover sting operation, the SEC filed an enforcement action against two individuals and their controlled entity. They are alleged to have conducted a business which helped shareholders conceal their...more
On August 26, Burger King announced that it entered into an agreement to acquire Tim Hortons, Inc., the Canadian coffee-and-doughnut chain, in a transaction that will be structured as an “inversion” (i.e., Burger King will...more
Converting Subpart F Income into Qualified Dividends -
U.S. shareholders of foreign corporations are generally not subject to tax on the earnings of such corporations until the earnings are repatriated to the...more
Federal appeals court provides a two-step “control” and “function” analysis for determining whether an entity qualifies as an “instrumentality” under the Foreign Corrupt Practices Act.
On May 16, the U.S. Court of...more
On May 16, 2014, a three-judge panel of the U.S. Court of Appeals for the Eleventh Circuit provided the first appellate court interpretation of the reach of the U.S. Foreign Corrupt Practices Act (FCPA) to conduct involving...more
A Match Made in Heaven -
U.S. shareholders of foreign corporations are generally not subject to U.S. federal income tax on the earnings of such corporations until those earnings are repatriated to the shareholders in...more
The following is a list of questions that should lead to the discovery of offshore assets, whether properly reported or not. If you answer yes to any of these questions, then you may have filing obligations and should seek...more
The IRS issued definitions and reporting requirements for shareholders of passive foreign investment companies (PFICs) effective December 31, 2013 for US tax returns for 2013 and onwards. The regulations provide guidance for...more
I am pleased to present to you DLA Piper’s “Doing Business in Japan” Guide.
Japan is the world’s third largest economy and remains cutting-edge in business. In 2012, 68 Global 500 Companies were headquartered in...more
A U.S. shareholder of a controlled foreign corporation (CFC) has gross income on its share of the CFC's subpart F income. This income includes “foreign base company sales income” or FBCSI. ...more
Proposed Regulations (REG-161948-05, 9/6/13) dealing with the importation of built-in loss properties under Sections 334(b)(1)(B) and Section 362(e)(1) are designed "to prevent erosion of the corporate tax base through the...more
The Commodity Futures Trading Commission’s Division of Swap Dealer and Intermediary Oversight (DSIO) has granted no-action relief from certain reporting obligations to commodity pool operators (CPOs) of registered investment...more
On September 5, the CFTC issued a no-action letter to commodity pool operators of registered funds that trade in commodity interest through wholly-owned controlled foreign corporations (CFCs)....more
Agency Template for Tailored Resolution Plans -
On September 3, the FDIC and the Fed released an optional model template for tailored resolution plans required to be submitted by the Dodd-Frank Act.
A recent private letter ruling illustrates how a non-U.S. procurement corporation can generate Subpart F income, but also illustrates an exception to the creation of that income....more
The New York State Bar Association’s Tax Section has recently published a report highlighting that, in a variety of commonplace circumstances where a controlled foreign corporation (CFC) engages in certain routine treasury...more
Back in 2011, we reviewed a Tax Court case that determined that income inclusion under the controlled foreign corporation (CFC) rules, while taxed like a dividend at ordinary income rates, could not qualify for the lower 15%...more
On January 1, 2013, the Senate passed the American Taxpayer Relief Act, H.R. 8 (the "Bill"), by a vote of 89 to 8. Later that same day, the House of Representatives approved the Bill by a vote of 257 to 167. On January 2,...more
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