Overview
IRS Releases Foreign Tax Credit Proposed Regulations: Today, Treasury and the IRS released proposed regulations that provide guidance relating to the determination of the foreign tax credit. The proposed regulations relate to changes made to the applicable law by the Tax Cuts and Jobs Act.
Chairman Hatch Announces Hearing for Tax Court Nominee: Senate Finance Committee Chairman Orrin Hatch (R-UT) will convene a hearing to consider Courtney Jones to be a judge of the US Tax Court. The hearing will take place on Tuesday, Dec. 4.
Tax Court Issues Memorandum Opinion in Estate of Ramirez v. Commissioner: In Estate of Ramirez v. Commissioner, the taxpayer reported on her 2008 and 2009 tax returns that her businesses produced passive income, which she offset with her rental properties’ passive losses. After an audit, the Commissioner reclassified most of the taxpayer’s business income as active. The taxpayer argued that the classification of her rental losses should also be changed to active. In a memorandum opinion, the Tax Court held that the rental activities were passive, finding that the taxpayer did not meet any of the material-participation tests for her rental business, and did not elect under section 469(c)(7)(A) to treat all her rental properties as a single activity for the relevant tax years. However, the Tax Court found that the taxpayer’s estate did not owe penalties under section 6662, holding that when an individual dies after filing her petition but before trial, the Commissioner bears the burden of producing evidence that penalties were approved in writing by a supervisor as required under section 6751.
Eurostat Publication on Tax-to-GDP Ratio in 2017 Released: According to a publication released by Eurostat, the statistical office of the European Union, the overall tax-to-GDP ratio, meaning the sum of taxes and net social contributions as a percentage of Gross Domestic Product, stood at 40.2% in the European Union in 2017, an increase compared with 2016 (39.9%).