July 3, 2022
U.S. Tax This Week for July 1
Ernst & Young's U.S. Tax This Week newsletter for the week ending July 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.
Top of the Week
IRS provides updated guidance for TE/GE to follow in examining tax-exempt organizations
The IRS Tax Exempt and Government Entities division (TE/GE) has published updated guidance to its employees on its examination process (TEGE-04-0920–0020). In addition to revising the examination process and instructions on how Issue Code data under the Reporting Compliance Case Management System (RCCMS) is used, the new guidance provides updated Internal Revenue Manual (IRM) sections, pertinent contacts and hyperlinks. EY Tax Alert 2022-1019 has details.
OECD and country officials discuss BEPS 2.0 Pillars One and Two and other OECD tax work
The Organisation for Economic Co-operation and Development (OECD) held its annual tax conference in Washington, DC, on 27-28 June 2022, following a pandemic-related hiatus since the June 2019 conference. The bulk of the discussion at the conference focused on developments with respect to Pillars One and Two of the ongoing project on addressing the tax challenges of the digitalization of the economy (the so-called Base Erosion and Profit Shifting (BEPS) 2.0 project). In addition, there were sessions on the OECD's work on global mobility of workers, tax and climate change, and tax certainty. EY Tax Alert 2022-1023 has details.
EY Guides, Surveys, and Reports
EY publication highlights accounting implications of 2022 Q2 tax developments
The Quarterly tax developments for the quarter ended June 30. Prepared by Ernst & Young LLP's Tax Accounting group, this publication provides a quarterly overview of enacted tax legislation, as well as regulatory developments and other items through June 16, 2022, except as noted.
Taxing crypto and other digital assets: Using practical scenarios to explore key tax concepts for individuals and businesses (July 21)
During this EY Webcast, Ernst & Young professionals will discuss recent digital assets' tax trends and the outlook for changes relevant to individuals and financial services companies.
Recent Tax Alerts
Internal Revenue Service
— Jun 29: IRS issues new guidance ahead of July 1, 2022 effective date for Superfund excise tax (Tax Alert 2022-1015)
— Jun 29: IRS rules on when normalization rules apply to depreciable property included in setting rates (Tax Alert 2022-1009)
— Jun 24: IRS publishes new FAQs on reinstated Superfund chemical tax (Tax Alert 2022-0987)
— Jun 24: IRS announces it won't rule on whether a transaction results in an employer reversion (Tax Alert 2022-0978)
— Jun 30: CJEU rules that Spanish rules on compensation for damages by the State are against EU law (Tax Alert 2022-1022)
— Jun 30: Türkiye's Istanbul Finance Center Law enters into force (Tax Alert 2022-1020)
— Jun 30: Swedish Ministry of Finance proposes new Withholding Tax Act (Tax Alert 2022-1018)
— Jun 30: Kenya enacts Finance Act, 2022 (Tax Alert 2022-1017)
— Jun 30: Hong Kong proposes to refine its foreign source income exemption regime forcertain passive income (Tax Alert 2022-1016)
— Jun 29: Costa Rica outlines requirements for qualifying as an approved exporter under certain free trade agreements (Tax Alert 2022-1011)
— Jun 29: Costa Rica reopens Customs Information System (Tax Alert 2022-1010)
— Jun 29: German Ministry of Finance extends deadline for applications for retroactive exemption in "clear" treaty cases to 30 June 2023 (Tax Alert 2022-1007)
— Jun 28: China | Customs and Tax Authorities in Shenzhen launch collaborative management of transfer pricing related to goods imported from related parties (Tax Alert 2022-1001)
— Jun 27: UAE Federal Tax Authority issues public clarification on excise tax (Tax Alert 2022-0997)
— Jun 27: Swiss Federal Council releases dispatch on constitutional amendment for BEPS 2.0 implementation in Switzerland (Tax Alert 2022-0994)
— Jun 24: Canada's 2022 Budget implementation bill receives Royal Assent (Tax Alert 2022-0990)
— Jun 24: Taiwan lifts transit ban, shortens quarantine period (Tax Alert 2022-0989)
— Jun 24: Saudi Arabia increases customs duties on certain goods (Tax Alert 2022-0986)
— Jun 24: European Parliament adopts carbon legislation package, final negotiations with EU Member State representatives expected soon (Tax Alert 2022-0977)
— Jun 24: UK Government launches short consultation on draft Energy (Oil and Gas) Profits Levy Bill (Tax Alert 2022-0976)
— Jun 24: What to expect in Washington (June 24) (Tax Alert 2022-0988)
— Jun 30: State corporate income and franchise tax developments in the second quarter of 2022 (Tax Alert 2022-1021)
— Jun 29: Reinstated Superfund excise tax applies to companies operating in Puerto Rico (Tax Alert 2022-1013)
— Jun 28: Vermont enacts significant corporate income tax changes (Tax Alert 2022-1006)
— Jun 28: Washington State requires disclosures in employer job opportunity advertising starting in 2023 (Tax Alert 2022-1005)
— Jun 28: Sales and Use Tax Quarterly Update for third quarter of 2022 (Tax Alert 2022-1004)
— Jun 27: City of Hazelton, Pennsylvania replaces business privilege and mercantile tax with Payroll Preparation Tax starting in 2022 (Tax Alert 2022-0998)
— Jun 24: Ohio clarifies tax treatment of certain sales of ownership interests in businesses (Tax Alert 2022-0991)
State and Local Tax Weekly
Highlights of this edition include:
— New Jersey Division of Taxation offers new transfer pricing initiative that runs through March 2, 2023. The New Jersey Division of Taxation (NJ DOT) is conducting a voluntary transfer pricing initiative that runs through March 2, 2023 (initiative).
— Vermont enacts significant corporate income tax changes. Recently enacted law (2022 Vt. Laws Act No. 148 (2022 VT SB 53) (2022 VT SB 53 or new law)), makes a number of significant changes to the state's corporate income tax laws and updates the state's conformity to the Internal Revenue Code of 1986, as amended (IRC).
— Income/Franchise, Sales & Use, Business Incentives, Property Tax, Compliance & Reporting, Controversy, Miscellaneous Tax
Highlights of this edition include:
- Democrats fail to reach consensus on pared-down budget reconciliation package
- Treasury Secretary testifies in support of anti-inflationary measures, BEPS 2.0
- US Supreme Court accepts FBAR filing case
- IRS to defer reporting for certain derivative payments in forthcoming BEAT regulations
- OECD officials offer update on BEPS 2.0 Pillars One and Two
OECD releases public consultation documents on tax certainty under Amount A for Pillar One
IRS Weekly Wrap-Up
| ||REG-130975-08||Guidance Under Section 2053 Regarding Deduction for Interest Expense and Amounts Paid Under a Personal Guarantee, Certain Substantiation Requirements, and Applicability of Present Value Concepts|
| ||2022-30||Section 59A Qualified Derivative Payments Reporting Extension|
| ||2022-31||Guidance Regarding the Changes Made by the American Rescue Plan Act to the Election of Alternative Minimum Funding Standards for Community Newspaper Plans under Section 430(m)|
Internal Revenue Bulletin
| ||2022-27||Internal Revenue Bulletin of July 5, 2022|
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.