Inversions and Debt/Equity Regulations Top Treasury’s 2016–2017 Priority Guidance Plan

By and on August 16, 2016

Yesterday, the US Department of the Treasury (Treasury) released the 2016–2017 Priority Guidance Plan (Plan) containing 281 projects that are priorities for Treasury and the Internal Revenue Service (IRS) during the period July 2016 through June 2017. The Plan contains several categories of topics, starting with consolidated returns and ending with tax-exempt bonds. The Plan also contains an appendix that lists more routine guidance that is generally published each year. Treasury and the IRS will update and republish the plan during the next 12 months to reflect additional items that have become priorities and guidance that has been published during the year. The public is invited to continue to provide comments and suggestions as guidance is written throughout the year.

Notable items include

  • Final regulations regarding inversions and related transactions (temporary and proposed regulations were published on April 8, 2016)
  • Final regulations under Internal Revenue Code (Code) Section 385 regarding the treatment of certain interests in corporations as stock (proposed regulations were published on April 8, 2016)
  • Final regulations under Code Section 956 regarding the treatment of loans to foreign partnership and related issues (temporary and proposed regulations were published on September 2, 2015)
  • Regulations under Code Section 367(d) regarding transfers of intangible property to foreign corporations (proposed regulations regarding the transfer of property, including foreign goodwill and going concern value, were published in September 16, 2015)
  • Regulations under Code Section 1256(g)(2) to address the US Court of Appeal for the Sixth Circuit’s holding in Wright v. Commissioner that over-the-counter foreign currency options are foreign currency contracts subject to mark-to-market accounting under Code Section 1256
  • Guidance relating to Code Section 48 on qualifying energy property and the modification, extension and phase out of the investment tax credit for solar energy property

It is clear from the Plan that international tax issues are receiving substantial resources from Treasury. Taxpayers and their advisors should review the Plan to see whether there may be forthcoming guidance that impacts their tax planning matters. Indeed, many of these issues impact typical business transactions for multinational entities.

Andrew R. Roberson
Andrew (Andy) R. Roberson focuses his practice on tax controversy and litigation matters. He represents clients before the Internal Revenue Service (IRS) Examination Division and Appeals Office and has been involved in over 75 matters at all levels of the federal court system, including the US Tax Court and Federal District Courts, several US Courts of Appeal and the Supreme Court. Andy has experience settling tax disputes through alternative dispute resolution procedures, including Fast Track Settlement and Post-Appeals Mediation, and in representing clients in Compliance Assurance Process (CAP) audits. In addition to representing corporations and partnerships in tax disputes, he also represents high net-worth individuals and assists taxpayers needing to make voluntary disclosures. Read Andy Roberson's full bio.


Kevin Spencer
Kevin Spencer focuses his practice on tax controversy issues. Kevin represents clients in complicated tax disputes in court and before the Internal Revenue Service (IRS) at the IRS Appeals and Examination divisions. In addition to his tax controversy practice, Kevin has broad experience advising clients on various tax issues, including tax accounting, employment and reasonable compensation, civil and criminal tax penalties, IRS procedures, reportable transactions and tax shelters, renewable energy, state and local tax, and private client matters. After earning his Master of Tax degree, Kevin had the privilege to clerk for the Honorable Robert P. Ruwe on the US Tax Court. Read Kevin Spencer's full bio.

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