September 1983 Proposed Regulations Concerning Foreign Debt Registration Reguirements
Article Abstract:
A second set of proposed regulations for the registration of debt obligations came out in September of 1983. They revise part of the regulations brought out in November 1982. They furnish directives as to the exemption from penalties for holders of foreign-designed bearer obligations. Section 310 of the Tax Equity and Fiscal Resonsibility Act of 1982 (TEFRA) demands debt registration where the obligation is public with greater than one year's maturity. This will facilitate IRS monitoring of obligations' dispositions and acquisitions, so that they can ensure proper reporting of gains and interest. Issuers of bearer form registration required obligations may well encounter: denied interest deductions for the obligations, denied earnings reductions for the interest, and an excise tax equivalent to the multiple of one per cent of the principal of the unregistered obligation and the years in the term. Exemptions from penalties include a reasonably designed obligation sale for foreign persons, which is analyzed in detail.
Publication Name: Tax Management International Journal
Subject: Law
ISSN: 0090-4600
Year: 1984
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The Service Proposes New Regulations Under Section 897
Article Abstract:
In 1980, the internal Revenue Code added sections 897 and 6039c via the Foreign Investments in Real Property Tax Act (FIRPTA). Section 897 is aimed at taxing non resident aliens and foreign firms selling United States real property. 6039c is a reporting method to promote compliance with the new provisions. Temporary and proposed regulations were printed in the fall of 1982, and spoke to determinations of real property holding corporations and security amendment methods to be used instead of owner identification. This compara five research on the temporary and proposed laws defines real property, lack of detail in the definition of improvements, lack of charity as to associate use provisions, creditor interest only as to commission, interest rates or loans or repossession or foreclosure, and no interest in the real property itself. Most importantly, Section 897 does not automatically apply to all interests in real property. Assessments of debt instruments are highlighted.
Publication Name: Tax Management International Journal
Subject: Law
ISSN: 0090-4600
Year: 1984
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Final Foreign Tax Credit Regulations Effect an Important Change in Separate Levy Rules
Article Abstract:
Final regulations have been issued pertaining to the taxes that qualify for foreign tax credits under sections 901 and 903. Final regulations have many significant changes from the proposed regulations, particularly as they apply to United States firms offering construction, financial and other services to foreign governments. For a foreign tax credit to be creditable, it has to be a tax in United States terms and not a taxpayer renumeration for specific economic benefit (SEB). If a service company pays a levy on the fee mandated by the foreign government that is different from a levy paid by those not getting an SEB, the service company's complete payment will be treated as a tax for United States purposes. If the levy meets the requirements of sections 901 and 903, it will be credited. Final regulations speak only to a difference in degree, not in kind. The link of this fee to safe harbor treatments is explained.
Publication Name: Tax Management International Journal
Subject: Law
ISSN: 0090-4600
Year: 1984
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