On September 22, 2009, the Office of Chief Counsel of the Internal Revenue Service (“IRS”) released a generic legal advice memorandum (“Memorandum”), concluding that interest income earned by a foreign corporation with respect to loans originated by an agent in the U.S., whether dependent or independent, is subject to net income tax in the U.S. as income “effectively connected” with the conduct of a U.S. trade or business. The Memorandum is significant in that it clearly indicates that the IRS is prepared to take an aggressive stance against strategies developed by offshore funds and lenders that use intermediaries to originate loans in the U.S. without subjecting income derived from those activities to tax in the U.S. An expansive view of the Memorandum indicates that the IRS might also challenge situations in which an intermediary acquires or services loans pursuant to a management agreement.