Miller & Chevalier Chartered’s Post

The Miller & Chevalier Chartered tax team has released our Monthly Tax Roundup covering May developments. George Hani and I have an article discussing a Circuit Court affirmance of a Tax Court decision on the clear reflection of income doctrine (Continuing Life Communities), and Sam Lapin, Omar M. Hussein, and I have an article discussing a Circuit Court reversal of a Tax Court decision on the IRS's authority to assess certain international reporting penalties (Farhy). Skim the table of contents to see if anything else catches your eye. #tax #taxlaw #taxaccounting

Navigating the varying local rules of the arm’s-length range in transfer pricing is crucial for taxpayers to ensure compliance. Understanding different jurisdictions' approaches to establishing the arm’s-length range can help mitigate potential double taxation risks. Operational transfer pricing can assist in managing differences in ranges across geographies and minimizing transfer pricing adjustments. Staying informed about evolving transfer pricing rules and upcoming changes like Pillar One’s Amount B is essential for tax practitioners and multinational enterprises. #TaxLaw #ArmsLenthPrinciple #MultinationalBusiness

How filing Form 5471 might affect you Filing Form 5471 is more than just another administrative task for U.S. taxpayers with foreign interests. This form is crucial for the IRS to gain detailed insight into the business activities and financial positions of U.S. citizens with stakes in foreign corporations. Failure to file this form correctly can result in hefty fines and other legal repercussions. It's important to understand that not only direct ownership interests are considered, but also indirect ownership through third-party entities. This means that even if you don't directly hold shares in a foreign corporation, you might still be required to file Form 5471. The incorrect or incomplete filing of this form not only increases the risk of penalties but can also significantly impact your tax liabilities. If you have foreign business interests, it's essential to consult with an expert to avoid future issues and legal consequences. Read more: https://lnkd.in/dBcQNZAh #taxes #internationaltax #UStaxes #Form5471 #taxstrategy #taxadvice

In their article with Bloomberg Tax, my Crowe colleagues Sowmya Varadharajan and Michael Santoro discuss the current state #TransferPricing landscape and how companies can stay compliant.

Dear Valued Partners,, We are pleased to share with you our latest Tax Alert (Special Budget Edition) covering the major tax (direct and indirect) measures proposed by the Mauritian Government in the Finance Bill 2024. A critical question raised by stakeholders is whether we should make a provision for the CCR levy, which will be applied retrospectively in respect of financial years ending after 31 December 2023. Although the Finance Bill has not yet been voted into law, it is expected to be enacted, with or without changes, within 15 days. To determine whether the CCR levy should be accrued in your financial statements under IFRS, you should consider the guidance provided in IAS 37 "Provisions, Contingent Liabilities and Contingent Assets" and IFRIC 23 "Uncertainty over Income Tax Treatments." Here are the key considerations: IAS 37 - Provisions, Contingent Liabilities and Contingent Assets: A provision should be recognized if:There is a present obligation (legal or constructive) as a result of a past event. It is probable that an outflow of resources embodying economic benefits will be required to settle the obligation.A reliable estimate can be made of the amount of the obligation.There may be a constructive obligation to account for the CCR levy.. IFRIC 23 - Uncertainty over Income Tax Treatments: This interpretation deals with how to recognize and measure deferred and current income tax assets and liabilities when there is uncertainty over tax treatments.When it comes to uncertain tax positions, entities need to determine if it is probable that the tax authority will accept an uncertain tax treatment. If yes, the entity should determine the tax position consistently with the tax treatment used or planned to be used in its income tax filings.If it is not probable that the tax authority will accept an uncertain tax treatment, the entity should reflect the effect of the uncertainty in determining the related accounting treatment. Given these points, if the Finance Bill has not been enacted and there is no current legal obligation, it might be considered an uncertain tax position. For FS that will be signed before enactment: It might be more appropriate to disclose the potential liability in the notes rather than recognizing a provision, since there is no current legal obligation. For FS that will be signed after the enactment: If the Bill is enacted as expected, a provision should be recognized as the obligation becomes a legal one. A word of caution Although I am an accountant, my expertise lies more in tax laws than in IFRS. The specific circumstances of your situation will play a crucial role in determining the appropriate accounting treatment. Consulting with your auditors for a precise application to your financial statements is advisable. Webinar Announcement: Join us on Thursday, 25 July 2024, from 14:00 to 16:00 for an insightful webinar discussing the implications of the recent ARC decision in the Avago case.

BEPS 2.0 Pillar 2 and withholding taxes _________________________________________ If withholding tax (WHT) is borne by one constituent entity (CE) on behalf of the other CE, whose covered tax is it? I believe it depends on (a) nature of underlying income that is subject to WHT and (b) accounting. For dividends, the GloBE Rules provide for re-allocation of the dividend WHT from the CE-owner to the distributing CE. For other income, WHT paid on behalf is not a tax on the payer. It ought to be treated as an expense which reduces the payer's GloBE Income. For the income recipient, it is dependent on how it is being accounted for; for the WHT to be regarded as its covered tax, the income recipient ought to reflect a gross-up income and accrue the WHT in its books. Without the WHT being accrued in the CE's Financial Accounting Net Income or Loss, then it is not a covered tax that will be respected by the GloBE Rules. Below is an extract from the Frequently Asked Questions on Pillar 2 Directive of the EU. (The views shared in this post are not meant to be tax or accounting advice. Additionally, they do not necessarily reflect the views of EY organization and its member firms.) #beps #pillar2 #withholdingtax #coveredtax #paymentonbehalf

⚖️ The Inflation Reduction Act of 2022, signed into law on August 16, 2022, created a new corporate alternative minimum tax (CAMT) for taxable years beginning after December 31, 2022. On September 12, 2024, after issuing multiple pieces of interim guidance, Treasury and the IRS released a 604-page package of proposed regulations related to the CAMT regime. The proposed regulations conform to many aspects of the interim guidance but expand it in noteworthy ways, some of which are described in our latest article: ➡️ LEARN MORE: https://lnkd.in/gTtrkp_p #krscpas #taxregulations #irs #treasury

On August 6, 2024, Treasury and the IRS issued proposed regulations that tackle various persistent concerns surrounding dual consolidated losses and establish new guidelines for disregarded payment losses. In this alert, our A&M Tax specialists evaluate these proposed rules and their possible implications for taxpayers. If you wish to discuss the effects of the proposed regulations on dual consolidated losses and disregarded payment losses in relation to your business and tax strategies, please reach out to Kevin M. Jacobs from our National Tax Office. https://okt.to/Fd8IqN #NationalTax

On August 6, 2024, Treasury and the IRS issued proposed regulations that tackle various persistent concerns surrounding dual consolidated losses and establish new guidelines for disregarded payment losses. In this alert, our A&M Tax specialists evaluate these proposed rules and their possible implications for taxpayers. If you wish to discuss the effects of the proposed regulations on dual consolidated losses and disregarded payment losses in relation to your business and tax strategies, please reach out to Kevin M. Jacobs from our National Tax Office. https://okt.to/c7QkNK #NationalTax

On August 6, 2024, Treasury and the IRS issued proposed regulations that tackle various persistent concerns surrounding dual consolidated losses and establish new guidelines for disregarded payment losses. In this alert, our A&M Tax specialists evaluate these proposed rules and their possible implications for taxpayers. If you wish to discuss the effects of the proposed regulations on dual consolidated losses and disregarded payment losses in relation to your business and tax strategies, please reach out to Kevin M. Jacobs from our National Tax Office. https://okt.to/V6P7Fv #NationalTax