IRS Reverses Position on Cross-Border Stock Transfers

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IRS revises its approach to transfers of stock to foreign corporations in exchange for property, saying that gain might be recognized on the deemed transfer of shares. “The IRS has decided that the complexities and uncertainties of not applying tax code Section 367 to certain deemed exchanges in cross-border tax code Section 304 transactions were more than the complexities and uncertainties of applying tax code Section 367 to the deemed exchanges,” Andrew Mitchel, an international tax attorney from Essex, Conn., tells Bloomberg BNA.