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14 June 2020

U.S. International Tax This Week for June 12

Ernst & Young's U.S. International Tax This Week newsletter for the week ending June 12 is now available. Prepared by Ernst & Young's International Tax Services group, this weekly update summarizes important news, cases, and other developments in international taxation.

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Spotlight

Senate Republicans reportedly are not planning to take up the next coronavirus stimulus package until the end of July, following the two-week Fourth of July recess. Senate Majority Leader Mitch McConnell was quoted as telling his caucus on 9 June that he considers the work period following the 4 July recess — which extends from 20 July to 7 August — as the period during which the Senate should consider and pass the next installment of COVID-19 legislation.

White House National Economic Council Director Larry Kudlow also this week said during a cable news interview that the next round of coronavirus stimulus negotiations would begin "in earnest" after Independence Day. Kudlow said that President Trump remains interested in tax incentives and other assistance to companies that return their foreign operations to the US. Last month, President Trump suggested that businesses that manufacture products outside the US could face additional taxes, although he did not mention any specifics.

The Internal Revenue Service this week issued Notice 2020-47, requesting recommendations from the public for guidance projects to be included in the 2020–2021 Priority Guidance Plan. Recommendations are requested to be submitted by 22 July, although suggestions will be accepted anytime during the year. The US Trade Representative recently released four chapters of the uniform regulations necessary for understanding implementation of key provisions within the US-Mexico-Canada Free Trade Agreement (USMCA). The USMCA is set to take effect on 1 July. The regulations, trilaterally agreed, reflect US Customs and Border Protection's USMCA Interim Implementation Instructions, with the bulk of the information covering the interpretation, application and administration of rules of origin, as well as providing increased insight into the changes that USMCA enacts, especially for the automotive industry. See EY Tax Alert 2020-1543 for details.

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Upcoming Webcasts

15th Annual International Quantitative and Reporting Conference: Key reporting and compliance changes for 2019 filings (part 1 of 2) (June 17)
During this Thought Center Webcast, Ernst & Young professionals will cover new additions and best practices with respect to the following IRS forms (i) Form 5471, Information Return of U.S. Persons With Respect To Certain Foreign Corporations ,(ii) Form 8858, Information Return of U.S. Persons With Respect To Foreign Disregarded Entities (FDEs) and Foreign Branches (FBs), (iii) Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships and (iv) Form 8990, Limitation on Business Interest Expense Under Section 163(j).

15th Annual International Quantitative and Reporting Conference: Key reporting and compliance changes for 2019 filings (part 2 of 2) (June 17)
During this Thought Center Webcast, Ernst & Young professionals will cover new additions and best practices with respect to IRS Forms 8992, U.S. Shareholder Calculation of Global Intangible Low-Taxed Income (GILTI) and 1118, Foreign Tax Credit – Corporations. Our panelists will also discuss expense apportionment under the 2019 proposed foreign tax credit regulations, including research and experimental (R&E) expenses, stewardship and foreign income taxes.

15th Annual International Quantitative and Reporting Conference: Amended returns and preparing for IRS audits (June 22)
During this Thought Center Webcast, Ernst & Young professionals will address the most significant tax controversy matters affecting today’s tax departments, including Section 965 transition tax audit issues, IRS international tax exam focuses and matters relating to Section 905(c).

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Recent Tax Alerts

United States

Africa

Asia

Canada & Latin America

Europe

Middle East

Multinational

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IRS Weekly Wrap-Up

Internal Revenue Bulletin

 2020-25Internal Revenue Bulletin of June 15, 2020

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Additional Resources

Ernst & Young Client Portal, the leading source for news, analysis, and reference materials for corporate tax professionals, has a variety of content of interest to international tax practitioners, including:

— International Tax Online Reference Service. Key information about, and important tax developments from, 56 foreign jurisdictions, including information on tax rates, interest rates and penalties, withholding, and filing dates.

— EY/Passport. EY/Passport is your guide to planning ventures in the global economy, offering a wealth of tax and business knowledge on more than 150 countries.

Because the matters covered herein are complicated, U.S. International Tax This Week should not be regarded as offering a complete explanation and should not be used for making decisions. Any decision concerning matters covered herein should be reviewed with a qualified tax advisor.

Document ID: 2020-1549

 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

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