News & Analysis as of

Transfer of Interest Internal Revenue Service

Fenwick & West LLP

Rawat Creates a Ripple in Statutory Interpretation Principles

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Recently, in Rawat v. Commissioner, the D.C. Circuit reversed the Tax Court decision and held that a foreign partner would not be subject to U.S. tax on selling an interest in a partnership with “hot assets” subject to §...more

Womble Bond Dickinson

IRS Publishes Final Regulations for Transfer of Certain Credits

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The Inflation Reduction Act of 2022 added Section 6418 to the Internal Revenue Code (the “Code”) to allow taxpayers to sell certain Federal income tax credits....more

Holland & Knight LLP

Treasury Department and IRS Release Final Regulations on the Transfer of IRA Tax Credits

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As provided in the Inflation Reduction Act (IRA), eligible taxpayers may make a yearly election to transfer all (or any portion) of an eligible credit to an unrelated taxpayer under Section 6418 of the Internal Revenue Code,...more

Wilson Sonsini Goodrich & Rosati

Treasury and IRS Release Long-Awaited Proposed Regulations on Section 48 Investment Tax Credits

On November 17, 2023, the U.S. Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) issued a notice of proposed rulemaking (the Proposed Regulations) regarding the investment tax credit (ITC) under...more

Eversheds Sutherland (US) LLP

Directions regarding Direct Pay - Proposed Regulations Released on Elective Payment for Inflation Reduction Act Renewable Energy...

On June 14, 2023, the Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) issued guidance on several topics related to tax credit monetization under the Inflation Reduction Act of 2022 (IRA),...more

Eversheds Sutherland (US) LLP

Treasury and IRS release proposed regulations on transferability of IRA renewable energy credits

On June 14, 2023, the Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) issued guidance on several topics related to tax credit monetization under the Inflation Reduction Act of 2022 (IRA),...more

Latham & Watkins LLP

IRS Proposed Rules Explain How Taxpayers Can Buy and Sell Renewable Energy Tax Credits or Receive Cash Refunds

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The proposed rules for monetizing tax credits should catalyze energy transition markets and offer an alternative to tax equity transactions. On June 14, 2023, the IRS issued proposed rules for how it intends to administer...more

Paul Hastings LLP

Treasury and IRS Issue Long-Awaited Guidance on Energy Tax Credit Transfers

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The Inflation Reduction Act of 2022 added Section 6418 to the Internal Revenue Code of 1986, as amended (the “Code”), which allows taxpayers to elect to transfer all or any portion of certain energy tax credits to an...more

Holland & Knight LLP

Inflation Reduction Act: Answers to Key Questions on Direct Pay and Transferability

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The U.S. Department of the Treasury (Treasury Department) and Internal Revenue Service (IRS) released much-anticipated guidance in the form of two notices of proposed rulemaking (NOPRs) regarding the direct payment of tax...more

BakerHostetler

Overview of the Proposed Regulations Addressing Transferring Renewable Credits

BakerHostetler on

As covered in our prior alerts, the Inflation Reduction Act modified and reinstated existing renewable energy credits, enacted new renewable energy credits and enacted under § 6418 an election that allows eligible taxpayers...more

Eversheds Sutherland (US) LLP

Treasury and the IRS release much-anticipated guidance, including with respect to the monetization of energy tax credits

On June 14, 2023, the Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) released a package of much-awaited guidance (the Guidance) consisting of (i) proposed regulations addressing the tax credit...more

Holland & Knight LLP

Treasury Department and IRS Release Direct Pay and Transferability Guidance

Holland & Knight LLP on

The U.S. Department of the Treasury and IRS on June 14, 2023, released two notices of proposed rulemaking (NOPRs) regarding the direct payment of tax credits under Section 6417 of the Internal Revenue Code (Elective Payment...more

BCLP

The Transferability of Tax Credits: the Creation of Secondary Market Under the Inflation Reduction Act

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The Inflation Reduction Act of 2022 (the “IRA”) represents the largest investment in clean energy and climate change in the history of the United States, with over $370 billion of funding to provide tax credits for clean...more

Akin Gump Strauss Hauer & Feld LLP

Secondary U.S. Withholding for Transfers in Private Investment Funds Delayed Until January 1, 2023

Key Points - Fund-level liability for a buyer’s failure to withhold upon secondary market transfer of an LP interest in a fund with ECI assets will apply only for transfers on or after January 1, 2023. Certain...more

K&L Gates LLP

IRS Issues Section 1446(f) Final Regulations

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On 7 October 2020, the Treasury Department and the Internal Revenue Service (IRS) released final regulations under Code Section 1446(f) (the Final Regulations), which clarify aspects of the withholding requirements with...more

McDermott Will & Emery

IRS Issues Final Regulations Concerning Withholding on Partnership Interest Transfers

McDermott Will & Emery on

The US Department of the Treasury and Internal Revenue Service (IRS) recently issued final regulations under section 1446(f), a provision enacted as part of the Tax Cuts and Jobs Act of 2017 (TCJA) that generally imposes a...more

Hogan Lovells

Final regulations – U.S. withholding tax on transfers of partnership interests

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Since 2018, the buyers, sellers, and partnerships engaging in secondary and other transactions involving partnership interest transfers have been navigating complicated U.S. tax and related withholding obligations that apply...more

Hogan Lovells

Final regulations - Foreign partner's U.S. tax liability on transfer of partnership interest

Hogan Lovells on

Given the overall development of the secondaries market and the increasing volume and size of secondary funds, the U.S. tax and withholding regime that applies to a foreign partner transferring an interest in a partnership...more

McDermott Will & Emery

Gift of a Remainder Interest in a Personal Residence or Farm to Charity – Why Now?

McDermott Will & Emery on

The Gift of a Remainder Interest in a Personal Residence Or Farm to Charity is a special technique that fits a small set of charitable donors. For those to whom it does apply, historically low interest rates make now the time...more

Hogan Lovells

Secondary Transactions: ECI Withholding Amount and Partnership Liabilities

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Proposed regulations have recently been issued by the U.S. Internal Revenue Services (IRS) under a withholding provision of U.S. tax law enacted in 2017 that imposes withholding tax on a non-U.S. person’s sale (or other...more

Troutman Pepper

Transferring Partnership Interests: Buyer Beware of Withholding Obligations, Seller Beware of Tax Liability - Tax Update Volume...

Troutman Pepper on

The U.S. federal taxation of non-U.S. persons who transfer interests in partnerships has a long and storied history. The government staked out its position in 1991, effectively providing that a non-U.S. partner should be...more

Wilson Sonsini Goodrich & Rosati

Recent Guidance Regarding Withholding on Certain Transfers of Partnership Interests by Non-U.S. Persons

On April 2, 2018, the U.S. Treasury Department and the Internal Revenue Service (IRS) issued Notice 2018-29, "Guidance Regarding the Implementation of New Section 1446(f) for Partnership Interests That Are Not Publicly...more

Kramer Levin Naftalis & Frankel LLP

Funds Talk: September 2017 - Tax Court Declines to Follow Rev. Rul. 91-32

In a recent decision, Grecian Magnesite Mining, Industrial & Shipping Co., SA v. Commissioner, the U.S. Tax Court declined to follow Revenue Ruling 91-32, and held that gain on the sale of an interest in an operating...more

Dickinson Wright

U.S. Tax Court Bounces Rev. Rul. 91-32: Sales of Partnership Interests by Foreign Partners May Not be Subject to U.S. Tax

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The practice of tax law is an exercise of statutory interpretation. A recent opinion of the U.S. Tax Court, Grecian Magnesite Mining, Indust. & Ship. Co. v. C.I.R., 149 T.C. No. 3 (July 13, 2017), is illustrative. Grecian...more

Troutman Pepper

Foreign Partner Not Taxable on Partnership Sale

Troutman Pepper on

Private equity and venture capital funds often invest in portfolio companies that are formed as partnerships or limited liability companies. But these investments create certain problems for foreign limited partners (LPs) in...more

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