Last week the IRS published the following Private Letter Rulings and Chief Counsel Advice relating to international taxation.
PLR 201251003: Shares of a domestic corporation were transferred to foreign corporation in order to deconsolidate the domestic corporation. Code §1502.
PLR 201251005: A real estate investment trust’s (REIT’s) deemed inclusions as Subpart F Income under Code §951 and passive foreign investment company (“PFIC”) inclusions under Code §1293 are considered qualifying income under Code §856(c)(2). In addition, currency gain or loss under Code §986(c) is also considered qualifying income under Code §856(c)(2).
CCA 201251012: “DOM,” a U.S. citizen who resides in the U.S. and operates a sporting event bookmaking business, contracts with a foreign corporation (“FOR”) to maintain betting information about DOM’s bettors. FOR’s participation in the arrangement is limited to data maintenance. DOM is accepting wagers and is liable for the Code §4401 excise tax on wagers.
CCA 201251015: Brief email indicating that a taxpayer would be eligible under Article 19 of a treaty for the $5,000 annual exclusion for a period of no more than 5 years.
The de-consolidation effected in PLR 201251003 can be graphically represented as (for a PDF click here):