Strategizing Multinational Tax Risks

The US developments are centered around the new regulations for BEAT and Foreign Tax Credit (FTC).

The new BEAT regulations include:

• Excludes non-recognition transactions re: Sec. 332, 351, 355, and 368
• Allows foregoing a deduction, albeit it will be for all US federal tax purposes
• Clarifies anti-abuse rules

The final FTC regulations include:

• Reducing previously taxed E&P baskets to 10, from 16
• Gross tested income is tiered up for purposes of allocating interest expense
• Foreign tax redeterminations are addressed
• Foreign branch rules are detailed

Additionally, Section 987 regulations are deferred by another year.

EY’s Global Tax Alert details the latest developments.

Click to access 2019G_005410-19Gbl_German%20Federal%20Council%20approves%20Research%20Allowance%20Act.pdf