Proposed regulations would tax conduits as true lenders

Article Abstract:

The proposed IRS regulations under IRC section 881 identify when the IRS would recharacterize conduit financing arrangements under the authority granted by IRC section 7701(l). The IRS may recharacterize financing arrangements, such as loans, that involve an intermediary when the arrangement reduces tax liability, participation of the intermediary is part of a tax avoidance plan and the intermediary is related or would not have participated on the same terms if other parties were involved. The recharacterization would allow the IRS to disregard the intermediary.

United States, Tax planning, Loans, Related party transactions

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Internal Revenue Service proposes regulations on qualified domestic trusts

Article Abstract:

The IRS is further clarifying the taxation and marital deductions of inheritance or estate transfers to alien spouses. The IRS has proposed new regulations to IRC section 2056 which would require not only that such transfers be made to qualified domestic trusts in order to be deductible but that additional criterion must be met as well. These new criteria involve the date of the transfer relative to the new regulations, and the citizenship and resident status of the recipient prior to and after the transfer.

Transfer taxes, Aliens, Marital deduction

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International matters: section 482 proposed regulations alter transfer pricing for tangible property

Article Abstract:

Proposed regulations for IRC section 482 on transfer pricing are too harsh. Tangible property sales using a method other than comparable uncontrolled price must fall within a comparable profit interval. Calculation of the interval is too complicated and requires too much third party information for a company to reasonably gather. Also, safe harbors are not included.

Investments, Transfer pricing

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