Monday, 11 April 2016

Anti-Inversion Guidance: US Treasury Releases Temporary and Proposed Regulations

On 4 April 2016, the US Treasury and the IRS issued temporary regulations under Code sections 304, 367, 956, 7701(l) and 7874 to address certain inversion and post-inversion transactions. The temporary regulations include rules previously described in Notice 2014-52 and Notice 2015-79. The temporary regulations also provide: (i) rules for identifying a foreign acquiring corporation when a domestic entity acquisition involves multiple steps; (ii) rules that disregard stock of the foreign acquiring corporation that is attributable to certain prior domestic entity acquisitions; (iii) rules that require a CFC to recognize all realized gain upon certain transfers of assets described in section 351 that shift the ownership of those assets to a related foreign person that is not a CFC; and (iv) rules clarifying the definition of group income for purposes of the substantial business activities test.

Source & more info: Deloitte