Strategizing Multinational Tax Risks

The Tax Executives Institute (TEI) has provided numerous comments re: Sec 965 positions as written in the law, supplemented by additional guidance.

Summary of comments:

1. Cash position definition
2. Foreign Tax Credit, double-counting of Earnings & Profits
3. Dividends paid from a CFC to another CFC or a third party
4. Hovering deficit taxes
5. Stock basis election should be extended to 180 days, vs. 90 days per IRS guidance
6. Changes in methods of accounting
7. Anti-abuse rules
8. CFC attribute mismatches
9. Foreign tax credit adjustment
10. “Applicable percentage” guidance
11. Average FX rate, vs. year-end spot rate, used for measurement
12. 2017 overpayments applied automatically to transition tax (Still an issue!)
13. Penalty protection

The letter provides background and examples related to the comment areas, and should be reviewed to gain a further understanding of the complex dynamics that will hopefully be mitigated via the suggestions.

Click to access TEI-Comments-Proposed-Section-965-Regulations-9%20October-2018.pdf