"

Estimated reading time: 1 minute, 22 seconds

IRS Releases Guidance for Issues Under New Law

irsThe Internal Revenue Service has issued guidance for a variety of issues stemming from the Tax Cuts and Jobs Act. These issues include transition tax on foreign earnings, business interest expense limitations and on withholding on the transfer of partnership interest by foreign persons.  

 

Proposed regulations on transition tax for foreign earnings (Notice 2018 – 26) include rules intended to prevent the avoidance of section 965, rules and procedures relating to certain special elections under section 965, and guidance on the reporting and payment of the transition tax. The notice also provides relief to taxpayers from certain estimated tax requirements and penalties arising from the enactment of the transition tax and the change to existing stock attribution rules in the new law.

Notice 2018-29 provides guidance regarding the withholding on the transfer of non-publicly traded partnership interests. The new law treats a foreign taxpayer’s gain or loss on the sale or exchange of a partnership interest as effectively connected with the conduct of a trade or business in the United States to the extent that gain or loss would be treated as effectively connected with the conduct of a trade or business in the United States if the partnership sold all of its assets.  The new law also imposes a withholding tax on the disposition of a partnership interest by a foreign taxpayer.

Notice 2018 - 28 addresses computing the business interest expense limitation the law. In general, newly amended section 163(j) of the Internal Revenue Code imposes a limitation on deductions for business interest incurred by certain large businesses. For most large businesses, business interest expense is limited to any business interest income plus 30 percent of the business’ adjusted taxable income.

 

 

Read 4960 times
Rate this item
(0 votes)

Visit other PMG Sites:

Template Settings

Color

For each color, the params below will give default values
Tomato Green Blue Cyan Dark_Red Dark_Blue

Body

Background Color
Text Color

Header

Background Color

Footer

Select menu
Google Font
Body Font-size
Body Font-family
Direction
PMG360 is committed to protecting the privacy of the personal data we collect from our subscribers/agents/customers/exhibitors and sponsors. On May 25th, the European's GDPR policy will be enforced. Nothing is changing about your current settings or how your information is processed, however, we have made a few changes. We have updated our Privacy Policy and Cookie Policy to make it easier for you to understand what information we collect, how and why we collect it.