16 January 2022

U.S. International Tax This Week for January 14

Ernst & Young's U.S. International Tax This Week newsletter for the week ending January 14 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

There was no substantive action on President Joe Biden's proposed Build Back Better legislation this week as Congressional Democrats pivoted to other legislative priorities, primarily voting rights and the filibuster. The main question regarding the future of the Build Back Better Act (BBBA) has been whether President Biden and Democratic leaders in Congress could accept Senator Joe Manchin's pre-holiday offer to the White House for 10-year funding on climate, health, and universal pre-kindergarten, but no extension of the now-expired expanded Child Tax Credit. The press is now reporting that Senator Manchin no longer supports his $1.8 trillion BBBA counterproposal that he made to President Biden in December. Senator Manchin also is said to have signaled that he no longer would favor any legislation resembling President Biden's expansive Build Back Better plan, although the Senator indicated there are individual proposals that he would support.

White House Press Secretary Jen Psaki said on 10 January, " … conversations are continuing behind the scenes at a staff level. And I can assure you that … that the President is going to continue to press to get Build Back Better done … ."

A Treasury official this week said that the US is developing interim guidance on cryptocurrency reporting, but provisions included in the recently enacted infrastructure bill have required officials to make revisions to drafts. The official was quoted as saying that regulations covering reporting requirements under IRC Section 6045 are a priority, but declined to provide a timeline for the regulations.

An Internal Revenue Service (IRS) official this week also was quoted as saying that the IRS Office of Fraud Enforcement (OFE) is working with the IRS Criminal Investigation division to ensure that agents have the necessary technology and training to find and follow cryptocurrency transactions. According to the official, the US will analyze available information by focusing on cryptocurrency transactions and taxpayers' financial and tax filings.

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EY Guides and Publications

Realizing the value of your tax and finance function
EY's 2022 Tax and Finance Operations Survey, Realizing the value of your tax and finance function, highlights how businesses are actively transforming to meet today's largest challenges, including the impact of COVID-19, shifting workforce dynamics, environmental, social and governance impacts on long-term value and more.

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Upcoming Webcasts

BEPS 2.0: Focus on Pillar Two (January 14)
During this EY Webcast, Ernst & Young professionals will discuss the key elements of the Pillar Two model rules, highlighting what is new with this latest release. They also will share perspectives on how the European Union and other jurisdictions plan to incorporate these model rules into domestic law.

Private Equity and Private Capital - Navigating transformative global and US legislative change (January 18)
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.

Supply chain and tax challenges for manufacturers in Mexico (January 19)
The global economy is undergoing significant supply chain disruption, creating new challenges for multinationals with manufacturing operations in Mexico. Mexico’s 2022 tax reform could also affect these manufacturers. As such, companies may wish to explore manufacturing alternatives in Mexico that could yield new operating and tax efficiencies. During this EY Webcast, Ernst & Young professionals will address these issues.

Tax in the time of COVID-19: Update on legislative, economic, regulatory and IRS developments (January 21)
During this EY Webcast, Ernst & Young panelists will provide updates on: (i) the US economy and tax policy; (ii) breaking developments; and (iii) what’s happening at the IRS.

How the UK AHC regime will impact the alternative investment funds landscape (January 24)
Please join our panel of professionals for our webcast – a timely discussion of recent Tax industry trends and the outlook for changes relevant to US-based asset managers.

EY Tax.Tech™ webcast series: Understanding the future of tax - - the intelligent finance and tax function (January 25)
During this EY Webcast, Ernst & Young professionals will give a view into the workings of the new intelligent finance and tax function. They’ll explore issues ranging from the operating model necessary to underpin this integrated approach to the advanced technology platform and common data framework flowing through the complete finance and tax process life cycle.

BorderCrossings . . . With EY transfer pricing and tax professionals (January 27)
Multinational companies often encounter related transactions – for example, the sale of tangible goods with the use of intangibles, or the sale of goods along with services being provided. This month’s BorderCrossings webcast addresses these issues by focusing on the related “aggregation principle” in transfer pricing. The webcast will also include a brief update on recent activities around the OECD’s “Pillar One” and “Pillar Two” initiatives under BEPS 2.0.

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Recent Tax Alerts

United States

Africa

Asia

Canada & Latin America

Europe

Multinational

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Recent Newsletters

ITS/Washington Dispatch
   Highlights of this edition include:

Legislation

  • Biden Administration’s Build Back Better legislation stalls in Congress; Senate Finance Committee releases updated international tax provisions

IRS news

  • Treasury releases final foreign tax credit regulations
  • IRS issues final rules on tax consequences of transition from LIBOR and other interbank offered rates in certain financial contracts
  • FinCEN again extends certain signature authority reporting (FBAR, Form 114) over foreign financial accounts

OECD news

  • OECD releases Model Rules on Pillar Two Global Minimum Tax
  • OECD releases 2020 peer review report on BEPS Action 5 on the Exchange of Information of Tax Rulings

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IRS Weekly Wrap-Up

Internal Revenue Bulletin

 2022-03Internal Revenue Bulletin of January 14, 2022

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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:

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: 2022-0076