New Proposed and Temporary Regulations Addressing Inversion Transactions

Treasury has issued new proposed and temporary inversion regulations.

Temporary Inversion Regulations

Proposed Inversion Regulations

The regulations contain rules described in two notices (Notice 2014-52, 2014-42 I.R.B. 712 and Notice 2015-79, 2015-49 I.R.B. 775).

In addition, the regulations contain the following rules (as set forth in the preamble):

(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 controlled foreign corporation (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.

And a Chicago Tribune article discussing the new regulations.

 

One thought on “New Proposed and Temporary Regulations Addressing Inversion Transactions

  1. Pingback: Treasury Fact Sheet on new Inversion and Earnings Strippings Regulations | Tax Pro Super Happy Fun Time - A Tax Blog

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