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Lowell D. Yoder focuses his practice on cross-border mergers and acquisitions, global tax planning and international tax controversies, representing high-tech, pharmaceutical, e-commerce, financial, consumer and industrial companies. He advises on tax-efficient structuring of cross-border acquisitions, dispositions, financings, internal reorganizations and joint ventures, as well as tax-beneficial planning for intangible holding companies, global supply chains and multi-jurisdictional service arrangements. Lowell also represents clients before the Internal Revenue Service (IRS), handling audits and obtaining tax rulings. He works with an extensive network of lawyers worldwide, developing tax-favorable transactional and operational cross-border structures. Lowell is the global head of McDermott's Tax Practice. Read Lowell Yoder's full bio.

Expansion of Subpart F under the Tax Reform Act


By , and on Feb 8, 2018
Posted In Tax Reform, Uncategorized

Under Subpart F, certain types of income and investments of earnings of a foreign corporation controlled by US shareholders (controlled foreign corporation, or CFC) are deemed distributed to the US shareholders and subject to current taxation. The recent tax reform legislation (Public Law No. 115-97) increased the amount of CFC income currently taxable to US shareholders,...

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The New Base Erosion Minimum Tax


By , and on Jan 19, 2018
Posted In Tax Reform, Uncategorized

The recently enacted 2017 tax reform act imposes a new “base erosion and anti-abuse tax” (BEAT) on large corporations. The BEAT operates as a limited-scope alternative minimum tax, applied by adding back to taxable income certain deductible payments made to related foreign persons. Although positioned as an anti-abuse rule, the BEAT presents challenges for a...

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IRS Releases Several Transfer Pricing Directives


By and on Jan 17, 2018
Posted In IRS Audits, IRS Guidance, Transfer Pricing Resource, Uncategorized

The Internal Revenue Service (IRS) Large Business and International (LB&I) Division recently released several directives (LB&I Directives) geared toward transfer pricing. LB&I acknowledges that significant LB&I resources are devoted to transfer pricing issues, and such issues make up a substantial portion of the LB&I inventory. It appears that these directives are aimed at ensuring that...

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Tax Reform Conference Committee Reaches Agreement


By , , , and on Dec 18, 2017
Posted In IRS Guidance, Tax Reform, Uncategorized

A House-Senate conference committee has reached agreement on a compromise version of the Tax Cuts and Jobs Act, which includes substantial changes to the corporate and international business taxation rules. The stage now appears to be set for final passage and enactment of the legislation before the end of 2017. Continue Reading.

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The IRS Has Never Won a Subpart F Sales or Services Case


By on Nov 22, 2017
Posted In Appellate Courts, IRS Appeals, Trial Courts, Uncategorized

The IRS has never won a single litigated case arguing for foreign base company sales income (and has never litigated a foreign base company services income case). Courts have consistently rejected the government’s arguments to expansively apply the definition of Subpart F sales income in order to carry out asserted congressional intent. While the courts...

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Statutes of Limitation in the International Tax Context


By , and on Oct 19, 2017
Posted In IRS Audits, IRS Guidance, Trial Courts, Uncategorized

As most taxpayers know, under Internal Revenue Code (Code) Section 6501(a), the Internal Revenue Service (IRS) generally has three years after a tax return is filed to assess any additional tax. However, Code Section 6501 provides several exceptions to this rule, including but not limited to the following. False or fraudulent returns with the intent...

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Final Code Sec. 367(a) and (d) Regulations


By on Mar 7, 2017
Posted In IRS Guidance, Tax Refunds, Uncategorized

“The IRS and Treasury recently issued final regulations under Code Sec. 367(a)and (d) that make a monumental change in how those provisions have applied since they were enacted over 30 years ago. For the first time, the regulations subject to taxation the otherwise tax free transfer of foreign goodwill and going concern value by a...

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Final §385 Regulations Apply to CFC Loans to Domestic Corporations


By on Mar 3, 2017
Posted In IRS Guidance, Tax Refunds, Uncategorized

The Treasury and IRS recently issued final regulations under §385 that reclassify certain indebtedness as equity. While the final regulations have limited application to U.S.-based multinationals, they do apply to obligations of domestic corporations to related controlled foreign corporations (‘‘CFCs’’). It is critical to avoid such debt being reclassified as stock under the regulations because...

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Proposed Code Sec. 367 Regulations Attempt to Tax Foreign Goodwill and Going Concern Value


By on Jun 3, 2016
Posted In IRS Guidance, Transfer Pricing Resource, Uncategorized

The transfer of foreign goodwill and going concern value by a domestic corporation to a foreign subsidiary for use in a trade or business outside the United States has never been subject to taxation under Code Sec. 367. Without any legislative change, the Internal Revenue Service and the Treasury in proposed regulations would seek to...

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Subpart F: When Does a CFC Receive Substantial Assistance in Performing Services?


By on Apr 14, 2016
Posted In Transfer Pricing Resource, Uncategorized

Income derived by a controlled foreign corporation (CFC) from performing services for an unrelated customer generally is not Subpart F income. However, if U.S. related persons furnish substantial assistance contributing to the performance of the services, under regulations, the CFC will be deemed to perform the services for a related person. In such case, the services...

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