The Resource Treasury strengthens attack on post-inversion transactions

Treasury strengthens attack on post-inversion transactions

Label
Treasury strengthens attack on post-inversion transactions
Title
Treasury strengthens attack on post-inversion transactions
Creator
Subject
Language
eng
Summary
This article examines the new Temporary Regulations that address certain post-inversion tax avoidance transactions. Section I reviews the anti-inversion rules under Code Sec. 7874. Section II analyses the Temporary Regulations under which a CFC's acquisitions of stock or obligations of a non-CFC foreign related person are treated as U.S. property under Code Sec. 956. Section III considers the Temporary Regulations that deal with transactions to de-control or significantly dilute the ownership interest in CFCs, including the Code Sec. 7701(l) recharacterization rule, the Code Sec. 367(b) stock dilution rule and the Code Sec. 367(b) asset dilution rule. Section IV covers the Temporary Regulations under Code Sec. 304 that limit the ability of Code Sec. 304 redemptions to remove untaxed earnings and profits of a CFC. Section V reviews the Temporary Regulations under Code Sec. 7874 that expand the definition of inversion gain. Section VI concludes that while the Temporary Regulations limit the ability for U.S. shareholders to avoid U.S. tax on a CFCs pre-inversion earnings and profits, they are unable to address the motivation to move future earnings and future growth outside the U.S. tax system. The new proposed regulations issued under Code Sec. 385 that address earnings stripping and related-party debt are not covered in the article
Citation source
In: Taxes - the tax magazine. - Riverwoods. - Vol. 94 (2016), no. 11 ; p. 31-56, 67-68
http://library.link/vocab/creatorName
Doering, J.A
Geographic coverage
North America
Language note
English
http://library.link/vocab/subjectName
  • corporate inversion
  • anti-inversion
  • CFC
Label
Treasury strengthens attack on post-inversion transactions
Instantiates
Publication
Label
Treasury strengthens attack on post-inversion transactions
Publication

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