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September 26, 2021
2021-1735

U.S. Tax This Week for September 24

Ernst & Young's U.S. Tax This Week newsletter for the week ending September 24 is now available. Prepared by Ernst & Young's National Tax Department in Washington, D.C., this weekly update summarizes important news, cases, and other developments in U.S. taxation.

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Top of the Week

Reconciliation bill approved by Ways & Means committee contains proposals affecting corporate M&A

Recently proposed tax provisions in the Build Back Better Act reconciliation bill, which were approved by the House Ways & Means Committee, would make changes relating to taxable liquidations, securities exchanges in spin-offs and dividends from acquired controlled foreign corporations (CFCs). The House Ways & Means Committee also released a section-by-section summary of the provisions. EY Tax Alert 2021-1724 has details.

IRS and Treasury issue 2021 — 2022 Priority Guidance Plan, addressing various accounting method issues

The IRS and Treasury have issued the 2021 — 2022 Priority Guidance Plan, addressing various accounting method issues. The plan includes 193 guidance projects, which the Treasury and IRS are seeking to complete by June 30, 2022. EY Tax Alert 2021-1699 has details.

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Upcoming Webcasts

US Indirect Tax Controversy: Current audit trends and outlook, including ways to manage your state tax posture (September 29)
During this Thought Center Webcast, Ernst & Young professionals will discuss recent audit trends in select states, including California, New York and Texas, and possible avenues to resolve uncertain tax positions.

Build Back Better legislative developments: Advanced manufacturing, sustainability and workforce incentives (September 30)
The US legislative environment is fluid, making it critical for businesses to keep informed about proposed legislation and its potential impact. During this Thought Center Webcast, Ernst & Young professionals will discuss the latest legislative developments, including proposed advanced manufacturing, sustainability and workforce incentives.

Washington, DC update: Congress is back in session (October 6)
During this Thought Center Webcast, please join Global and Americas Real Estate Market Sector Leader - Tax, Peter Mahoney, members of Washington Council Ernst & Young and the Ernst & Young LLP National Tax Department for a US legislative and regulatory update for the real estate industry.

PE and Private Company quarterly tax webcast (October 21)
During this Thought Center Webcast, Ernst & Young professionals will discuss recent global private equity (PE) industry trends and the outlook for US and international legislative and regulatory changes relevant to PE and alternative funds, transactions and portfolio companies.

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Recent Tax Alerts

Internal Revenue Service

— Sep 23: IRS launches new website providing information on refund cases subject to JCT review (Tax Alert 2021-1722)

— Sep 21: IRS final regulations address treatment of qualified improvement property and provides guidance on foreign tax credits (Tax Alert 2021-1707)

— Sep 20: IRS and Treasury issue 2021—2022 Priority Guidance Plan, addressing various accounting method issues (Tax Alert 2021-1699)

— Sep 17: IRS clarifies guidance on e-signature relief (Tax Alert 2021-1687)

International

— Sep 23: Swiss Parliament acts to eliminate import customs duties on industrial goods as soon as 1 January 2022 (Tax Alert 2021-1726)

— Sep 23: The Netherlands publishes draft legislation on reverse hybrid entities as final part of ATAD II implementation (Tax Alert 2021-1725)

— Sep 23: China implements new, stricter requirements for obtaining health codes in 55 jurisdictions (Tax Alert 2021-1723)

— Sep 22: Netherlands issues proposed legislation with unilateral measures against international transfer pricing mismatches (Tax Alert 2021-1717)

— Sep 22: High Court of Kenya declares that minimum tax is unconstitutional (Tax Alert 2021-1714)

— Sep 22: The Netherlands publishes 2022 budget proposals (Tax Alert 2021-1713)

— Sep 21: Sweden implements new, stricter requirements for obtaining permanent residence (Tax Alert 2021-1712)

— Sep 21: Israeli Tax Authority finalizes international tax reform package for further discussion and potential legislation (Tax Alert 2021-1710)

— Sep 21: Cyprus announces further extension of non-application of administrative fines for DAC6 submissions to 30 November 2021 (Tax Alert 2021-1709)

— Sep 22: The Latest on BEPS and Beyond | September 2021 edition (Tax Alert 2021-1708)

— Sep 20: Brazil increases tax on financial transactions (Tax Alert 2021-1706)

— Sep 21: Singapore expands transfer pricing guidance (Tax Alert 2021-1705)

— Sep 20: Colombia enacts 2021 tax reform (Tax Alert 2021-1698)

— Sep 20: Nigeria announces new entry guidelines for Indian citizens and India-outbound travelers (Tax Alert 2021-1695)

— Sep 20: China implements new, stricter requirements for Official Invitation (PU) letters sponsored by companies based in Shanghai (Tax Alert 2021-1694)

— Sep 20: Poland's major tax reform proposal moves to Parliament (Tax Alert 2021-1692)

— Sep 17: Mexico's 2022 economic proposal focuses on eliminating loopholes (Tax Alert 2021-1688)

Legislation

— Sep 23: Lily Batchelder confirmed as Assistant Secretary for Tax Policy (Tax Alert 2021-1728)

— Sep 23: House Ways and Means Committee reconciliation bill contains proposed tax changes that would affect insurance companies (Tax Alert 2021-1727)

— Sep 22: Reconciliation bill approved by Ways & Means committee contains proposals affecting corporate M&A (Tax Alert 2021-1724)

— Sep 22: Cryptocurrency and other digital assets would be affected by tax proposals in budget reconciliation bill (Tax Alert 2021-1721)

— Sep 22: What to expect in Washington (September 22) (Tax Alert 2021-1718)

— Sep 21: Decreased affordability percentage under Affordable Care Act could impact affordability of employer health plans (Tax Alert 2021-1715)

— Sep 17: Tax plan in House Ways & Means reconciliation bill includes several proposals that would affect financial transactions and digital assets (Tax Alert 2021-1697)

— Sep 17: Build Back Better tax proposals would affect higher-income individuals, as well as trusts and estates (Tax Alert 2021-1696)

— Sep 17: Tax M&A Update for August 2021 (Tax Alert 2021-1689)

States

— Sep 23: South Carolina extends COVID-19 income tax relief for teleworkers through December 31, 2021 (Tax Alert 2021-1734)

— Sep 21: Texas clarifies that the second-quarter 2021 SUI tax payment is due by September 30, 2021 (Tax Alert 2021-1711)

— Sep 17: Connecticut deadline for employer paid family and medical leave insurance catch-up contributions is September 30, 2021 (Tax Alert 2021-1690)

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Recent Newsletters

State and Local Tax Weekly
   Highlights of this edition include:

— Illinois enacts elective pass-through entity tax. On Aug. 27, 2021, Illinois Governor J.B. Pritzker signed Public Act 102-0658 (the Act and formerly, Senate Bill 2531), establishing an elective income tax regime for pass-through entities (PTEs), including partnerships, S corporations and LLCs treated as either.

— New York tax department issues guidance on new pass-through entity tax; 2021 election must be made by Oct. 15, 2021. The New York Department of Taxation and Finance issued guidance1 on the newly-enacted elective tax on pass-through entities (which applies to certain eligible partnerships, S corporations and limited liability companies (LLC) treated as either, referred to herein as a PTE).

— Income/Franchise, Sales & Use, Business Incentives, Property Tax, Compliance & Reporting, Controversy, Payroll & Employment Tax, Value Added Tax, Upcoming Webcasts

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IRS Weekly Wrap-Up

Final Regulations

 TD 9954Treatment of Distributions of Property From a Corporation to a Shareholder
 TD 9956Guidance on the Treatment of Qualified Improvement Property Under Sections 250(b) and 951A(d) and Guidance Related to the Foreign Tax Credit

Notices

 2021-54Update for Weighted Average Interest Rates, Yield Curves, and Segment Rates

Because the matters covered herein are complicated, U.S. 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.

 

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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