A FURTHER LOOK AT THE TREATMENT OF FOREIGN TAXES UNDER REG. 1.1502-76

In the September/October 2012 issue of this journal, one of the author's colleagues, Lisa M. Brown, published an interesting article addressing the treatment of foreign taxes under Reg. 1.1502-76(b). Her article focused on the allocation of foreign taxes under Reg. 1.1502-76 when a member leave...

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Bibliographic Details
Published in:Corporate Taxation 2015-03, Vol.42 (2), p.29
Main Author: Sutton, Wade
Format: Article
Language:English
Subjects:
Asset acquisitions
Calendars
Capital assets
Consolidated tax returns
International taxation
Liability
Passive foreign investment companies
Principles
Tax regulations
Taxes
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Summary:In the September/October 2012 issue of this journal, one of the author's colleagues, Lisa M. Brown, published an interesting article addressing the treatment of foreign taxes under Reg. 1.1502-76(b). Her article focused on the allocation of foreign taxes under Reg. 1.1502-76 when a member leaves or joins a consolidated group. This article builds upon hers, exploring regulations that have adopted the principles of Reg. 1.1502-76 in allocating foreign taxes under Sections 338 and 901. Reg. 1.1502-76(b) has generated a fair amount of discussion in the tax world recently based on a memorandum published by the IRS in late 2012. The memorandum applied the so-called "next day" rule to certain expenses that accrue on the date of an acquisition. The regulations under Sections 338 and 901 have borrowed a detailed provision from the consolidated return rules that fulfills a related, but not identical, policy goal. As can be expected, importing the consolidated return rules into a foreign tax context has created several unresolved questions.
ISSN:1534-715X