Transnational Transfer Pricing Implications of Tax Reform

This program has been cancelled

A live 110-minute CPE webinar with interactive Q&A


Thursday, June 27, 2019 (in 2 days)

1:00pm-2:50pm EDT, 10:00am-11:50am PDT


This webinar will provide guidance on the implications of the 2017 tax law on cross-border transfer pricing. The panel will discuss the ways in which the reduction of the U.S. top corporate tax rate, combined with BEAT regulations and the introduction of a modified territorial tax system, create both opportunities and different risks than companies have previously associated with transfer pricing. The webinar will outline strategies to optimize the tax treatment of cross-border transactions.

Description

The 2017 tax reform law's reduction of corporate income tax rates, along with its movement toward a hybrid territorial tax regime, has created a host of opportunities and challenges for U.S. multinational enterprises (MNEs). In particular, the changes impact the strategies involving transfer pricing on cross-border transactions between a U.S. parent and a foreign subsidiary.

With the maximum corporate rate set at 21%, U.S. MNEs will have less incentive to structure transactions to take advantage of tax rate arbitrage between countries, particularly if the MNE can benefit from the GILTI exclusion or FDII deduction. However, the Section 245A "participation exemption" for the foreign-source portion of dividends increases and locks in the value of existing tax rate arbitrage structures.

A less obvious impact on MNEs with current or potential transfer pricing tax controversies is the Section 965 requirement that companies recalculate the deemed repatriation "toll charge" in the event of any tax adjustment impacting foreign earnings amounts before Jan. 1, 2018. Any reduction of a foreign transfer pricing tax liability may increase the repatriation tax.

Listen as our expert panel provides a practical guide to the impact of the 2017 tax reform law on transfer pricing strategies.

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Outline

  1. Prior transfer pricing landscape
  2. Impact of change to a modified territorial tax regime under the 2017 tax law on transfer pricing
  3. Participation exemption and opportunities for tax arbitrage
  4. The intersection of BEAT and transfer pricing rules
  5. Possibility of using corporate rate reduction to resolve transfer pricing controversies arising prior to 2018

Benefits

The panel will discuss these and other relevant topics:

  • How the tax landscape has--and hasn't--changed for U.S.-based MNEs and their transfer pricing structure
  • What role might transfer pricing adjustments have on an MNE's calculation of the deemed repatriation "toll charge" tax?
  • Impact of GILTI and FDII on an MNE's assessment of the effectiveness of existing transfer pricing strategies
  • Areas of uncertainty remaining in transfer pricing adjustments from periods prior to 2018

Faculty

Garcia, John
John Garcia, CPA
Owner
Corporate Tax Advisors

Mr. Garcia specializes in providing accounting, tax, and training services for mid-sized corporations with an...  |  Read More

Additional faculty
to be announced.