Foreign Tax Credits for U.S. Taxpayers: Dealing With New Restrictions

Preparing for Tough Limits on Credit Use and Repeal of 80/20 Rules

New federal act credit provisions take effect in August and January

Recording of a 110-minute CPE/CLE webinar with Q&A

Conducted on Thursday, October 7, 2010

Recorded event now available

or call 1-800-926-7926
Program Materials

This CLE webinar will prepare you to promptly comply with the foreign tax credit and international tax reform aspects of the Education Jobs and Medicaid Assistance Act of 2010.

Description

The Education Jobs and Medicaid Assistance Act of 2010, signed into law on Aug. 10, imposes significant new restrictions on U.S.-based multi-nationals and companies with business dealings with foreign entities. Some provisions took effect immediately, while others are effective Jan. 1, 2011.

Taxpayers used to claiming foreign tax credits must brace for an end to credit-splitting, credit denials for a portion of foreign tax paid on a covered asset acquisition, and separate credit limits on tax treaty items, among other changes. Plus, the 80/20 test for withholding ends on Jan. 1, 2011.

The government aims to raise $10 billion in extra taxes over ten years through this new law. Accounting advisors and their clients must prepare immediately to navigate the complex technical terms of the bill. Given the immediate effective dates, waiting for administrative regs is not prudent.

Listen as our panel of experienced tax advisors analyzes the international tax implications of the new federal law, helping you quickly get to work on compliance adjustments and alter your company's tax planning.

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Outline

  1. International tax increases included in Education Jobs and Medicaid Assistance Act of 2010
    1. International tax extenders shifted from separate tax extender bill onto this legislation
    2. Prohibition against foreign tax credit-splitting
    3. Denial of foreign tax credits for disqualified portion of foreign tax paid on covered asset acquisition
    4. Separate foreign tax credit limitation on tax treaty items
    5. Limit on foreign taxes a U.S. shareholder is deemed to pay under Sect. 956 inclusions
    6. Prevention of reduction of foreign subsidiary’s earnings and profits in some Sect. 304 redemptions
    7. Tightening of affiliation rules for interest expense
    8. Repeal of 80/20 rules for interest paid and U.S. withholding
    9. Technical corrections to statute of limitations
  2. Reevaluating a U.S. company’s foreign transactions, based on new law
  3. Necessary refinements of tax planning that involves foreign structures and business transactions

Benefits

The panel will get to the bottom line of these and other key topics:

  • The various new restrictions on the use of foreign tax credits.
  • The new prohibition on reducing a foreign subsidiary's earnings and profits in certain Sect. 304 redemptions.
  • The toughening of the rules on allocating and apportioning interest expense from a foreign corporation.
  • The repeal of the 80/20 rules for foreign-source interest and the withholding exemption on dividends.

Following the speaker presentations, you'll have an opportunity to get answers to your specific questions during the interactive Q&A.

Faculty

Fred Corso
Fred Corso
Tax Director
Marcum

He also leads the firm's International Tax Services Group and has more than 14 years of experience in accounting firm...  |  Read More

Allen Littman
Allen Littman
Partner
Baker Hostetler

He specializes in international tax planning for U.S. and foreign-based companies. Before coming to the firm, he worked...  |  Read More

LaVonda Napka
LaVonda Napka
Thompson Hine

Her work on clients' international tax projects covers transfer pricing, cross-border tax, withholding and CFC...  |  Read More

Stephen Feldman
Stephen Feldman
Partner
Morrison & Foerster

His general tax practice is primarily transaction-based and emphasizes outbound investments by U.S. companies and...  |  Read More

William Winter
William Winter
Tax Partner
Morris Manning & Martin

He specializes in both foreign taxation matters for expanding U.S. companies and U.S. taxation of foreign companies....  |  Read More

Other Formats
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Strafford will process CLE credit for one person on each recording. All formats include program handouts. To find out which recorded format will provide the best CLE option, select your state:

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