For over 50 years, Bloomberg BNA’s renowned flagship daily news service, Daily Tax Report® has helped leading practitioners and policymakers stay on the cutting edge of taxation and...
Nov. 4 — The government is exploring its options on the controversial area of earnings stripping as it works on regulations to implement the anti-inversions Notice 2014-52, a senior Treasury Department official said.
Douglas Poms, senior counsel in the Treasury Office of International Tax Counsel, said the agency continues to consider earnings stripping possibilities “in a manner consistent with the notice,” but no definite course of action has been decided, including whether earnings stripping might be addressed as part of the inversions guidance now underway.
Speaking Nov. 4 at the American Institute of CPAs Fall Tax Division Meeting, Poms said regulations to implement Notice 2014-52 will be finished in coming months, but couldn't give a more definite time frame. He told Bloomberg BNA following the panel that the government is considering options for more inversions guidance—options that may or may not include additional notices.
Intangibles Rules High Priority for 2016
Poms shared the panel with Brenda Zent, Treasury special adviser on international taxation, addressing a broad range of international issues.
On another topic, Zent said issuing final rules on the transfer of intangibles under tax code Section 367(d) is one of the government's highest priorities for 2016. Released in September, the proposed and temporary rules (REG-139483-13) eliminate tax exceptions on transfers of intangibles for goodwill and going concern (178 DTR G-4, 9/15/15).
The rules are intended to take away incentives for inappropriate transfer pricing positions on such transfers.
In answer to questions from practitioners, Zent said in working on the final rules, the government may be willing to consider narrow exceptions to guidance that now completely takes away exceptions for goodwill and going concern value. Treasury understands that this is “a very big change,” Zent said, but views the rules as “shutting down a serious abuse.”
In looking at possible carveouts, she said, “We're serious about the idea that it needs to be an exception that won't re-open the gates.” Zent said the government welcomes comments and already has had taxpayers come in and present what they believe are sympathetic fact patterns.
Section 901(m) Rules Getting Close
Among a range of other guidance that has made significant progress, Poms said rules that disallow foreign tax credits under Section 901(m) are “very far along.” He said the rules will be comprehensive and cover a broad range of areas.
The Treasury counsel said the government is also working on guidance on passive foreign investment companies, among other projects. “We're trying to get as much done as we can,” he said.
To contact the reporter on this story: Alison Bennett in Washington at email@example.com
To contact the editor responsible for this story: Brett Ferguson at firstname.lastname@example.org
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)