Presented below is our summary of significant IRS guidance and relevant tax matters for the week of August 20 – 24, 2018:
August 21, 2018: The IRS and Treasury released Notice 2018-67, which provides guidance regarding separately calculating the unrelated business taxable income (UBTI) of each trade or business conducted by a tax-exempt entity. Section 512(a)(6), enacted as part of tax reform, requires this separate calculation by tax-exempt organizations with more than one unrelated trade or business.
August 21, 2018: The IRS and Treasury released Notice 2018-68, which provides guidance regarding new section 162(m). Section 162(m), enacted as part of tax reform, limits the deduction for compensation paid by a publicly traded corporation to a covered employee. The notice provides guidance regarding the “grandfather” exception for certain compensation arrangements in effect on November 2, 2017. See our commentary for more information.
August 22, 2018: The IRS released Revenue Procedure 2018-44, which provides guidance regarding accounting method changing resulting from the revocation or termination of an entity’s S corporation status. Revenue Procedure 2018-44 adds such accounting method changes to the list of “automatic changes” listed in Revenue Procedure 2018-31.
August 22, 2018: The IRS published a draft Form 8992 for computing global low-taxed intangible income and a draft Form 8993 for computing foreign derived intangible income.
August 23, 2018: The IRS published proposed regulations providing guidance regarding the availability of a charitable deduction when the taxpayer also receives (or expects to receive) a state or local tax credit for the contribution.
August 24, 2018: The IRS made it clear that US citizens and residents that are contractors or employees of contractors supporting US Armed Forces are eligible for the section 911 foreign earned income exclusion.
August 24, 2018: The IRS released its weekly list of written determinations (e.g., Private Letter Rulings, Technical Advice Memorandum and Chief Counsel Advice).
Special thanks to Kevin Hall in our DC office for this week’s roundup.