Copying and distributing are prohibited without permission of the publisher

US eases foreign distribution

01 October 1999

The IRS’ active summer included final regulations on the treatment of distributions to foreign shareholders. This is good news for shareholders but taxpayers should beware the anti-abuse provisions. Mike Swanick and Aldrich Boss of PricewaterhouseCoopers in London report

The US Internal Revenue Service (IRS) has published final regulations on the treatment of distributions to foreign shareholders under Internal Revenue Code (IRC) sections 367(e)(1) and (2). The final regulations address the tax consequences of three types of distributions to foreign shareholders:

l a distribution by a domestic company of its subsidiary's stock under IRC section 355 (outbound distribution);

l a liquidation of a domestic corporation into a foreign parent corporation in a transaction described in IRC section 332 (outbound liquidation); and

l a liquidation of a foreign corporation into a foreign parent corporation in a transaction described in IRC section 332 (foreign-to-foreign liquidation).

The final regulations as a whole are a positive development for taxpayers, as an outbound section 355 distribution of the stock of a domestic corporation no longer requires gain recognition and the exceptions to taxation of an outbound liquidation have been expanded. However, new anti-abuse provisions have been created which echo...



This article is locked content, available to current subscribers or trialists.

  • Current subscribers or trialists - Please log in to view this article in full.
  • New users - Please take a free 7 day trial.
  • Expired subscribers or trialists - Please subscribe to gain immediate full access.

If you think you've received this message in error, please contact your account manager, Nick Burroughs:
Email: nburroughs@euromoneyplc.com, Tel: +44 (0)207 779 8379

Subscribe now

Subscribe today to gain full access to International Tax Review.

Subscribe

Free trial

Take a free trial now and gain 7 days of full access to International Tax Review.

Free trial





International Tax Review Profile

#ff @KeithMacCATax @Prixdetransfert @TaxesRita @tosacarte @p_sfitz

Sep 4 2015 06:02 ·  reply ·  retweet ·  favourite
International Tax Review Profile

How to resolve disputes in India http://t.co/LPVzfw9ScH Read about #taxcontroversyleaders2015 from #Asia here http://t.co/pmt90zZgTT

Sep 4 2015 03:48 ·  reply ·  retweet ·  favourite
International Tax Review Profile

RT @taxmOuth: TaxProse Daily Tax News is out! http://t.co/cP6JZgGX4d Stories via @wwwtaxproffcom @IntlTaxReview

Sep 3 2015 05:44 ·  reply ·  retweet ·  favourite
International Tax Review Profile

Two individuals. Plenty of very good women in the groups on the list, but, yes, it wasn't enough. #globaltax50 2015 https://t.co/LtlZCjerUG

Sep 3 2015 05:43 ·  reply ·  retweet ·  favourite
International Tax Review Profile

RT @GrantThorntonCA: Our transfer pricing practice has been nominated again for @IntlTaxReview Firm of the Year - Canada #tax #AmericasTaxA…

Sep 3 2015 05:38 ·  reply ·  retweet ·  favourite
International Correspondents

After the Irish budget, what would make you more likely to put more substance into Ireland?