Overview
IRS Releases Additional Details on Repatriation Tax: Today the IRS published a Frequently Asked Questions page on its website about the transition tax under section 965, which generally requires U.S. shareholders (as defined in section 951(b)) to pay a transition tax on the untaxed foreign earnings of certain specified foreign corporations as if those earnings had been repatriated to the United States. Taxpayers may have to pay this tax when filing their 2017 tax returns. Taxpayers who electronically file Form 1040 are requested to wait to file their return on or after April 2, 2018. This will provide the IRS time to make certain system changes to allow the returns to be accepted and processed.
IRS Announces It Will Close OVDP Effective September 28, 2018: Today the IRS announced that it would close the 2014 Offshore Voluntary Disclosure Program (OVDP) in an updated Frequently Asked Questions page published on its website. The IRS noted that while the program has been successful in the past, there has been a significant decline in the number of taxpayers participating as well as an increase in awareness of offshore tax and reporting obligations. The Streamlined Filing Compliance Procedures will remain available after the 2014 OVDP closes.
IRS Announces Rollout of Five LB&I Compliance Campaigns: Today the IRS Large Business and International (LB&I) division announced the identification and selection of five additional compliance campaigns. The campaigns are the culmination of an extensive effort to redefine large business compliance work and build a supportive infrastructure inside LB&I. The first set of 13 campaigns was announced in January 2017, with 11 additional campaigns announced in November 2017. The five additional campaigns announced today were identified through LB&I data analysis and suggestions from IRS compliance employees. The five campaigns concern: (1) costs that facilitate a section 355 transaction; (2) self-employment tax under the Self-Employment Contributions Act; (3) partnerships that stop filing tax returns; (4) the incorrect reporting of sales of partnership interests; and (5) the section 168 disposition regulations on recognizing gain or loss on the disposition of MACRS property and the partial disposition election.
Council of the EU Adjusts List of Non-Cooperative Jurisdictions: Today the Council of the European Union (EU) adjusted the EU’s list of non-cooperative jurisdictions in taxation matters in light of commitments made by listed jurisdictions and an assessment of jurisdictions for which no listing decision had yet been taken. Specifically, the Council removed Bahrain, the Marshall Islands, and Saint Lucia from the list and added the Bahamas, Saint Kitts and Nevis, and the U.S. Virgin Islands. The list is intended to promote good governance in taxation worldwide by maximizing efforts to prevent tax avoidance, tax fraud, and tax evasion.
Council of the EU Reaches Agreement on Tax Intermediaries: Today the Council of the EU reached an agreement on a Council Directive aimed at boosting transparency in order to tackle aggressive cross-border tax planning. The Directive will require intermediaries such as tax advisors, accountants, and lawyers that design and/or promote tax planning schemes to report schemes that are considered potentially aggressive. Member states will be required to automatically exchange the information they receive through a centralized database and will be obliged to impose penalties on intermediaries that do not comply with the transparency measures. The Directive is the latest of a number of measures designed to prevent corporate tax avoidance.
UK Chancellor Presents Spring Statement to Parliament: Today Chancellor Philip Hammond presented his first Spring Statement to Parliament. The Spring Statement gives an update on the overall health of the economy and the Office for Budget Responsibility forecasts. The Spring Statement also gives an update on progress made since Autumn Budget 2017 and invites people and businesses to give views on changes the government is considering.