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October 3, 2021
2021-1776

U.S. Tax This Week for October 1

Ernst & Young's U.S. Tax This Week newsletter for the week ending October 1 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

IRS and Treasury release 2021 — 2022 Priority Guidance Plan with new transfer pricing projects

On September 9, 2021, the IRS and Treasury released the 2021 — 22 priority guidance plan, which lists the projects to which the IRS and Treasury will allocate resources for plan year July 1, 2021 through June 30, 2022. This year's plan includes three new transfer pricing-related projects. EY Tax Alert 2021-1768 has details.

USCIS extends flexibility for responding to agency requests

USCIS announced on September 24, that it is extending the flexibilities for applicants, petitioners and requestors to respond to certain requests and notices. The flexibility applies if the issuance date listed on the request, notice or decision is between March 1, 2020 and January 15, 2022, inclusive. Where applicable, USCIS will consider a response to requests and notices received within 60 calendar days after the response due date in the request or notice before taking any action. EY Tax Alert 2021-1757 has details.

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Upcoming Webcasts

Washington, DC update: Congress is back in session (October 6)
During this EY 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.

Tax in the time of COVID-19: update on legislative, economic, regulatory and IRS developments (October 8)
During this Thought Center Webcast, Ernst & Young professionals will discuss how businesses can navigate the tax policy environment and continue to effectively operate their tax function in this time of crisis and change. Panelists will provide updates on: (i) the US economy and tax policy; (ii) breaking developments; and (iii) what’s happening at the IRS.

BorderCrossings: Trends driving new supply chain structures and multi-hub operating models (October 12)
During this Thought Center Webcast, Ernst & Young professionals will discuss the non-tax and tax considerations of more flexible, distributed hubs owing to several factors like the “war for talent,” the work-from-anywhere model and difficulty securing visa permits due to the ongoing COVID-19 crisis.

PE and Private Company quarterly tax webcast (October 21)
During this EY 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 28: IRS modifies list of countries that have information exchange agreements with US (Tax Alert 2021-1762)

— Sep 27: IRS final regulations establish new user fee for estate tax closing letter requests (Tax Alert 2021-1753)

International

— Sep 30: Brazilian tax authority rules withholding tax does not apply to cross-border insurance premiums paid by Brazilian customers to a Norwegian insurance company (Tax Alert 2021-1771)

— Sep 29: India Tax Administration extends applicability of transfer pricing safe harbor rules to financial year 2020-21 (Tax Alert 2021-1766)

— Sep 29: Kenya Revenue Authority issues public ruling to withdraw guidance note issued on treatment of tax losses (Tax Alert 2021-1764)

— Sep 29: EU Member States adopt public CbCR Directive (Tax Alert 2021-1763)

— Sep 28: Higher taxes for Polish taxpayers and some foreign companies discussed (Tax Alert 2021-1761)

— Sep 28: Poland plans to introduce tax on shifted profits (Tax Alert 2021-1758)

— Sep 28: Russia refines application of VAT reverse charge mechanism (Tax Alert 2021-1756)

— Sep 27: Sweden extends deadline for UK citizens to apply to retain their right of residence in Sweden; announces updated entry rules and restrictions (Tax Alert 2021-1755)

— Sep 28: French Government releases draft Finance Bill for 2022 (Tax Alert 2021-1754)

— Sep 27: New Zealand issues Operational Statement on Administration of imported hybrid mismatch rule (Tax Alert 2021-1751)

— Sep 24: United States to ease foreign air travel restrictions (Tax Alert 2021-1747)

— Sep 27: Israeli Court rules on reclassification of trademark transaction between a shareholder and its company and the arm’s-length return on R&D services (Tax Alert 2021-1746)

— Sep 24: Costa Rica introduces Digital Nomad Visas (Tax Alert 2021-1744)

— Sep 24: United Kingdom announces new entry rules for international travelers (Tax Alert 2021-1741)

Legislation

— Sep 29: Senate Banking panel questions Treasury Secretary Yellen, Fed Chair Powell on pandemic relief, other issues (Tax Alert 2021-1767)

— Sep 29: What to expect in Washington (September 29) (Tax Alert 2021-1765)

— Sep 24: Accounting methods and other domestic provisions would be affected by tax provisions in House Ways & Means Committee reconciliation bill (Tax Alert 2021-1743)

States

— Sep 30: Massachusetts enacts an elective tax on pass-through entities (Tax Alert 2021-1775)

— Sep 30: EY publication highlights accounting implications of 2021 Q3 income tax developments (Tax Alert 2021-1774)

— Sep 30: Oklahoma reinstates charging COVID-19 UI benefits to employer SUI accounts; deposit of federal funds made to avoid employer SUI surcharge (Tax Alert 2021-1773)

— Sep 29: Puerto Rico's Treasury Department clarifies guidance on transfer pricing studies and certification required with income tax return (Tax Alert 2021-1770)

— Sep 29: Puerto Rico's Department of State further extends due date to file 2020 corporate annual reports (Tax Alert 2021-1769)

— Sep 28: Ohio repays federal UI loan balance, removing FUTA credit reduction for 2022; employers resume being charged with UI benefits (Tax Alert 2021-1760)

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Recent Newsletters

State and Local Tax Weekly
   Highlights of this edition include:

— Tax provisions in House Ways and Means reconciliation bill could have state income tax implications On Sept. 13, 2021, the House Ways and Means Committee released the tax portion of its reconciliation bill (HW&M proposal) and a section-by-section summary of the tax proposals. The HW&M proposal, if enacted, could affect corporate and individual income taxes imposed by state and local (collectively, state) governments.

—  Income/Franchise, Sales & Use, Business Incentives, Property Tax, Controversy, Payroll & Employment Tax, Miscellaneous Tax, Unclaimed Property, Value Added Tax, Unclaimed Property

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IRS Weekly Wrap-Up

Final Regulations

 TD 9957User Fee for Estate Tax Closing Letter

Proposed Regulations

 REG–100718–21User Fees Relating to the Enrolled Agent Special Enrollment Examination and the Enrolled Retirement Plan Agent Special Enrollment Examination

Corrections

 TD 9922Guidance Related to the Allocation and Apportionment of Deductions and Foreign Taxes, Foreign Tax Redeterminations, Foreign Tax Credit Disallowance Under Section 965(g), Consolidated Groups, Hybrid Arrangements and Certain Payments Under Section 951A; Correction

Revenue Procedures

 2021-32Implementation of Nonresident Alien Deposit Interest Regulations

Internal Revenue Bulletin

 2021-40Internal Revenue Bulletin of October 4, 2021

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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