International Tax Blog

Eaton Corp. v. Commr., 152 T.C. No. 2 (2019)

Earlier this week the Tax Court concluded that the earnings and profits (E&P) of certain upper-tier CFCs was increased by the amount of Subpart F Income inclusions and Code §956 inclusions (Code §951(a) inclusions) that flowed up from lower-tier CFCs through a U.S. partnership. Below is a chart of the entity structure in the Eaton case. Read more →

Rental of Real Estate to Yourself

A taxpayer cannot rent property to him or herself. This is similar to the concept that a taxpayer cannot pay themselves a salary. For example, if a taxpayer has a sole proprietorship and he or she reports the income and expenses of that business on Schedule C of Form 1040, the taxpayer is not able to deduct salary expense on the Schedule C for “wages” paid to him or herself. This makes sense because a... Read more →

12 New Tax Charts

We recently added 12 new situational charts to andrewmitchel.com (listed in topical order). View these charts and over a thousand other free charts at andrewmitchel.com (listed in alpha-numeric order). Bass (Swiss Corporation Was Respected As a Separate Entity) Rev. Rul. 79-371 (Gift of Installment Note Triggered Gain) Rev. Rul. 80-58, Situation 1 (Rescission of Contract Within Same Taxable Year) Rev. Rul. 80-58, Situation 2 (Rescission of Contract in Following Taxable Year) Rev. Rul. 80-164 (Cash... Read more →

13 Charts of Code §958 Regulation Examples

We have created charts of the 13 of the examples included in Treas. Reg. §§1.958-1 and -2. Treas. Reg. §1.958-1 contains 5 examples demonstrating attribution through direct and indirect ownership. These regulations provide a limited form of attribution primarily for use in determining the amount taxable to a U.S. shareholder under Code §951(a) (Subpart F Income). Treas. Reg. §1.958-2 contains 8 examples demonstrating attribution through constructive ownership. These regulations provide that the attribution rules of... Read more →

10 Charts of Sec. 199A QBI Regulation Examples

Last week the IRS issued proposed regulations under Section 199A regarding the qualified business income (QBI) deduction. We have created charts of 10 of the examples included in Prop. Treas. Reg. §1.199A-1(c)(3) and (d)(4). We also created a video discussing the first four examples. See our YouTube channel. The examples include: 1.199A-1(c)(3) Ex. 1, QBI Ded'n, Below Threshold: TI Limit (No CG) Ex. 2, QBI Ded'n, Below Threshold: TI Limit (With CG) Ex. 3, QBI... Read more →

8 Charts of Sec. 965 Transition Tax Regulation Examples

Last week the IRS issued proposed regulations under the Section 965 Transition Tax. We have created charts of the 8 examples included in Prop. Treas. Reg. §1.965-1(g). The examples include: Example 1: Special Non-Attribution Rule For P'ships in Defining Specified Foreign Corporations Example 2: Attribution Rule For P'ships in Defining Specified Foreign Corporations Example 3: Determination of Accumulated Post-1986 Deferred Foreign Income (All E&P was PTI & DFI was zero) Example 4: Determination of Status... Read more →

8 New Tax Charts

We recently added 8 new situational charts to andrewmitchel.com (listed in topical order). View these charts and hundreds of other free charts at andrewmitchel.com (listed in alpha-numeric order). Buck (Pre-1954 Code: Grantor Trust Due to Retained Sprinkle Power) Carson (Grantor Held Power to Sprinkle Income Among Beneficiaries) Rev. Rul. 67-70 (Transfer of an Installment Note to a Grantor Trust Was Not a Disposition) Rev. Rul. 67-167 (Transfer of an Installment Note to a Nongrantor Trust... Read more →

5 New Tax Charts

We have added 5 new situational charts to andrewmitchel.com (listed in topical order). View these charts and hundreds of other free charts at andrewmitchel.com (listed in alpha-numeric order). Rev. Rul. 2007-49, Situation 1 (Vested Stock to Nonvested Stock with No Exchange) Rev. Rul. 2007-49, Situation 2 (Vested Stock to Nonvested Stock In Tax-Free Reorg Exchange) Reg. 1.987-2(c)(10), Example 10 (Section 987: Contribution of Assets to Corporation) Reg. 1.987-2(c)(10), Example 11 (Section 987 QBU: Circular Transfers)... Read more →

5 New Tax Charts

We have added 5 new situational charts to andrewmitchel.com (listed in topical order). View these charts and hundreds of other free charts at andrewmitchel.com (listed in alpha-numeric order). Rev. Rul. 73-157, Situation 1 (Installment Sale Method Not Available When Sold Thru Son As Conduit) Rev. Rul. 73-157, Situation 2 (Installment Sale Method Not Available When Sold Thru Corp As Conduit) Reg. 1.987-2(c)(10), Example 4 (Section 987: Sale of Property by a Section 987 QBU) Reg.... Read more →

5 New Tax Charts

Today we added 5 new situational charts to andrewmitchel.com (listed in topical order). View these charts and hundreds of other free charts at andrewmitchel.com (listed in alpha-numeric order). Grecian Magnesite Mining (Foreign Partner's Gain on Sale of U.S. Partnership Interest Not Effectively Connected Income) Rev. Rul. 2017-9, Situation 1 (351 Exchange (South) Followed By Spin-Off (North)) Rev. Rul. 2017-9, Situation 2 (Gain Recognized On South Transaction Due Boot Received Not Being Distributed) Reg. 1.987-2(c)(10), Ex.... Read more →

New Carousel of Tax Charts

Today we added a new way to view the charts on AndrewMitchel.com. We call it the “Carousel of Tax Charts.” We now have a total of 886 situational tax charts on AndrewMitchel.com, and the Carousel allows you to scroll through the charts much more easily. You are also able to filter the charts by topic so that you can scroll through only the relevant charts you want to research. Below is a short video showing... Read more →

Tax Court Declines to Follow Rev. Rul. 91-32

Last week, the Tax Court released an important opinion in Grecian Magnesite Mining, Industrial & Shipping Co., SA v. Commissioner, 149 T.C. No. 3, where the court declined to follow Rev. Rul. 91-32. For more than 25 years the IRS has maintained that gain on a foreign partner’s disposition of an interest in a partnership that conducts business in the U.S. is subject to U.S. tax. To arrive at this conclusion, the IRS applied the... Read more →

5 New Tax Charts

Today we added 5 new situational charts to andrewmitchel.com (listed in topical order). View these charts and hundreds of other free charts at andrewmitchel.com (listed in alpha-numeric order). Reg. 1.987-2(c)(10), Example 1 (Section 987: Disregarded Interbranch Transaction) Reg. 1.6038A-2(b)(9), Example 1 (5472 Reporting for U.S. Disregarded Entity) Reg. 1.6038A-2(b)(9), Example 2 (5472 Reporting for Transactions Between U.S. Disregarded Entities) PLR 9612017 (Gain on Sale of S Corporations Was Foreign Source Income) PLR 200620016 (Breach of... Read more →

5 New Tax Charts

Today we added 5 new situational charts to andrewmitchel.com (listed in topical order). View these charts and hundreds of other free charts at andrewmitchel.com (listed in alpha-numeric order). Inverworld (Cayman Island Company Was Engaged in a U.S. Trade or Business and Had U.S. ECI) Rev. Rul. 66-86 (Section 2036 Does Not Apply to Life Interest In Trust For Inherited Usufruct) Reg. 1.957-1(c), Example 8 (>50% Ownership of Value & At Least 10% of Vote Makes... Read more →

5 New Tax Charts

Today we added 5 new situational charts to andrewmitchel.com dealing with Section 987 Branch Transactions. Reg. 1.987-1(b)(7), Example 1 (Not a Section 987 QBU: Disregarded Entity Holding Stock & Servicing a Debt) Reg. 1.987-1(b)(7), Example 2 (Section 987 QBU: Disregarded Entities with Active Businesses) Reg. 1.987-1(b)(7), Example 3 (Section 987 QBU: Election to Treat Separate QBUs as One QBU) Reg. 1.987-1(b)(7), Example 4 (Section 987 QBU: Aggregate Partnerships) Reg. 1.987-1(b)(7), Example 5 (Section 987 QBU:... Read more →

15 New Tax Charts

Today we added 15 new situational charts to andrewmitchel.com dealing with a variety of topics. Am. Metallurgical Coal Co. v. Commr. T.C. Memo 2016-139: Transfer Was For Equity And Not For Debt; Post Transfer Payments Were Dividends In Re DeCoro USA Ltd U.S. Bankruptcy Court, M.D.N.C., Case No. 09-10846C-11G: Inbound Furniture Sales: Sales Comm. Model vs. Distributor Model Revenue Ruling 67-202: Contribution & Liquidation Was An Asset Reorganization & Section 269 Did Not Apply Revenue... Read more →

PFIC Mark-to-Market Election Charts & Videos

Today we added 12 new situational charts to andrewmitchel.com dealing with mark-to-market elections for PFICs. We also uploaded 12 new videos to our YouTube channel that briefly discuss each of the new charts. The charts and videos include: Gain from MTM Election in Year After Acquisition Is Included in Unreversed Inclusions Reg. 1.1296-1(a)(3)(iii), Ex. (Video) MTM Election Made in First PFIC Year, Which Was After Acquisition Year Reg. 1.1296-1(c)(7), Ex. 1 (Video) Gain Recognized in... Read more →

23 New Charts - Code §956 Regulation Examples from T.D. 9792

Last month, the IRS released Treasury Decision 9792, which included final regulations under Code §956. The final regulations include rules regarding U.S. property held by controlled foreign corporations ("CFCs") in transactions involving partnerships. There were 23 examples in the regulations, and we have created new situational charts that illustrate all 23 of the examples. The charts are available at http://andrewmitchel.com/topic.php#sec956, where you can find hundreds of other situational charts. Read more →

11 New Charts of Foreign Trust Distributions Through Intermediaries

Treas. Reg. §1.643(h)-1(a)(1) provides that any property transferred to a U.S. person by an intermediary who has received property from a foreign nongrantor trust will be treated as property transferred directly by the foreign nongrantor trust to the U.S. person, if the intermediary received the property pursuant to a plan that had tax avoidance as a principal purpose. A rebuttable presumption of tax avoidance is created if the U.S. person is related to the grantor... Read more →

New Videos - October 2016

Over the last month we have published videos on our YouTube channel Andrew Mitchel Tax discussing several of our situational charts, linked to below. Rev. Rul. 2004-59, Partnership Conversion to Corporation Rev. Rul. 2004-77, Disregarded Entity With Two Owners Rev. Rul. 2004-83, Related Stock Purchase & Liquidation Treated as a D Reorganization Rev. Rul. 2004-85, "F" Reorganization of an S Corp Did Not Terminate Qsub Election for Subsidiary Plantation Patterns - Shareholder/Guarantor Treated as Borrower... Read more →

Over 50 New Situational Charts – Code §7874 Regulation Examples

Earlier this year, the IRS released T.D. 9761, which included final and temporary regulations under Code §7874. The regulations contain new rules addressing inversions and certain post-inversion tax avoidance transactions. Today we have released over 50 situational charts that illustrate all of the examples embedded in the Code §7874 regulations. Specifically, the situational charts include the examples found in the following regulation sections: Treas. Reg. §1.7874–1 Disregard of affiliate-owned stock Treas. Reg. §1.7874–2 & –2T... Read more →

New Videos - September 2016

Over the last month we have published videos on our YouTube channel Andrew Mitchel Tax discussing several of our situational charts, linked to below. Rev. Rul. 99-6, Situation 1, Partnership to Disregarded Entity Rev. Rul. 99-6, Situation 2, Partnership to Disregarded Entity Notice 2001-17, Contingent Liability Tax Shelter Rev. Rul. 2004-3, Foreign Partner Deemed to be Engaged in the Conduct of U.S. Trade or Business You can view the situational charts and associated videos, on... Read more →

New Videos - July 2016

Over the last month we have published videos on our YouTube channel Andrew Mitchel Tax discussing several of our situational charts, linked to below. Rev. Rul. 86-138, Separate Statement of Items for Tiered Partnerships Rev. Rul. 87-96, Intercompany Dividend of Foreign Subsidiary Triggers Deferred 311(b) and 1248 Gains Rev. Rul. 88-25, Domestication is an F Reorganization Rev. Rul. 89-46, Ownership Attribution in Consolidated Group for 351 Exchange Rev. Rul. 89-101, 355 Spin-Off To Reduce Foreign... Read more →

New Videos - June 2016

Over the last month we have published videos on our YouTube channel Andrew Mitchel Tax discussing several of our situational charts along with IRS Form 5471 Schedule O and Form 5472, linked to below. Rev. Rul. 84-2 - Section 332 Liquidation With Creation of Nominee Entity Rev. Rul. 84-68 - Parent Payment of Bonuses to Subsidiary Employees Rev. Rul. 84-111, Situation 1 - Assets Over Conversion of Partnership to Corporation Form 5472, Info. Return of... Read more →

New Videos - May 2016

Over the last month we have published videos discussing several of our situational charts along with IRS Form 5471 Schedule M and Form 926, linked to below. Rev. Rul. 78-401 - No Meaningful Reduction in Proportionate Interest Upon Redemption Rev. Rul. 76-454 - Constructive Dividend as Part of 351 Exchange Rev. Rul. 78-281 - Non-Functional Currency Borrowing Form 5471 Schedule M - Transactions Between CFCs and Related Persons Rev. Rul. 79-70 - Bust 351 Via... Read more →