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October 9, 2022

U.S. Tax This Week for October 7

Ernst & Young's U.S. Tax This Week newsletter for the week ending October 7 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 rules that renewable energy facility is not public utility property

In PLR 202239002, the IRS ruled that a solar energy facility will not be considered public utility property (PUP) because its rates are fixed and not determined on a cost-of-service, rate-of-return basis. EY Tax Alert 2022-1498 has details.

OECD publishes Manual on Bilateral APAs

On 28 September 2022, the OECD published its Bilateral Advance Pricing Arrangement Manual (the Manual) as part of the ongoing tax certainty work of the OECD's Forum on Tax Administration. The Manual was approved by the Inclusive Framework on Base Erosion and Profit Shifting (BEPS) and all members of the OECD Forum on Tax Administration. EY Tax Alert 2022-1508 has details.

Upcoming Webcasts

EY Tax.Tech™ Ecosystem series: Unlocking the power of connected tax analytics (October 20)
During this EY Webcast, Ernst & Young professionals will showcase our EY Connected Tax Analytics in Power-BI, leveraging Thomson Reuters integration to supercharge and automate your corporate income tax compliance preparation and review process in ONESOURCE Income Tax. They’ll take you through the latest in use cases and preview what’s ahead.

Tax in the time of COVID-19: Update on legislative, economic, regulatory and IRS developments (October 21)
During this EY 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.

US corporate income tax compliance: Insights from Tax Year 2021 and planning for the next age of compliance (October 26)
During this EY Webcast, Ernst & Young professionals will discuss lessons learned from this year’s dynamic compliance environment – and how to plan for the 2022 federal, international and state tax filing season – and beyond.

BorderCrossings . . . With EY transfer pricing and tax professionals (October 27)
During this EY Webcast, Ernst & Young transfer pricing and tax professionals will help you stay informed and able to adopt a more proactive stance in developing and defending your transfer pricing policies and practices.

Recent Tax Alerts

Internal Revenue Service

— Oct 04: IRS issues 2022 inflation adjustment factor for carbon sequestration credit (Tax Alert 2022-1503)

— Oct 04: Farmers may not claim charitable deductions for donating crops to CRATs, and income from annuities purchased with crop proceeds is taxable to them (Tax Alert 2022-1502)

— Oct 04: IRS rules that renewable energy facility is not public utility property (Tax Alert 2022-1498)

— Oct 04: IRS revokes entity's exempt status as a supporting organization (Tax Alert 2022-1497)


— Oct 06: Poland announces expansion of the Poland Business Harbor Program (Tax Alert 2022-1518)

— Oct 06: EY Canada's Tax Matters @ EY for October 2022 (Tax Alert 2022-1513)

— Oct 06: Finland prohibits certain Russian nationals from entering as tourists (Tax Alert 2022-1512)

— Oct 05: OECD publishes Manual on Bilateral APAs (Tax Alert 2022-1508)

— Oct 05: Spain approves legislation on mandatory electronic invoicing (Tax Alert 2022-1507)

— Oct 05: Colombia extends due date to submit initial ultimate beneficial owners' information (Tax Alert 2022-1501)

— Oct 04: ECOFIN adopts revised list of non-cooperative jurisdictions for tax purposes; Pillar Two Directive not on the agenda (Tax Alert 2022-1500)

— Oct 04: Netherlands announces limitations to 30%-facility (Tax Alert 2022-1496)

— Oct 04: Australian Treasury releases consultation paper on BEPS 2.0 two-pillar global agreement (Tax Alert 2022-1494)

— Oct 04: United Arab Emirates outlines changes to short-term and long-term visa categories (Tax Alert 2022-1491)

— Oct 04: EU Member States politically agree on electricity revenue cap and solidarity contribution of fossil fuel sector (Tax Alert 2022-1488)

— Oct 03: South Africa extends expired visas for certain foreigners with pending visa or waiver applications (Tax Alert 2022-1486)

— Oct 04: UK Government updates income tax proposal from its mini-Budget (Tax Alert 2022-1485)

— Oct 03: Poland proposes change to shifted profits tax that places burden of proof on the Polish taxpayer (Tax Alert 2022-1484)

— Oct 03: USCIS extends Green Card validity extension to 24 months for Green Card renewals (Tax Alert 2022-1483)

— Oct 03: Kenyan citizens must obtain biometric e-passports by November 30 (Tax Alert 2022-1482)

— Sep 30: Mexico announces electronic Multiple Immigration Forms pilot program at select airports (Tax Alert 2022-1475)

— Sep 30: Malaysia announces new DE Rantau Nomad Pass for digital nomads (Tax Alert 2022-1474)

— Sep 30: El Salvador’s Tax Authority publishes list of tax havens for 2023 (Tax Alert 2022-1471)

— Sep 30: Denmark provides withholding tax exemption for nonresident charities as of 1 January 2023 (Tax Alert 2022-1470)

— Sep 30: Ireland announces Budget 2023 (Tax Alert 2022-1461)


— Sep 30: What to expect in Washington (September 30) (Tax Alert 2022-1469)


— Oct 06: Sales and Use Tax Quarterly Update for fourth quarter of 2022 (Tax Alert 2022-1514)

— Oct 05: Puerto Rico's Treasury Department extends sales tax exemption for prepared food because of Hurricane Fiona to October 13, 2022 (Tax Alert 2022-1511)

— Oct 05: Virginia revised income tax withholding tables and formulas apply for wages paid on and after October 1, 2022 (Tax Alert 2022-1509)

— Oct 04: Cleveland ordered to refund municipal income tax to Pennsylvania remote worker (Tax Alert 2022-1504)

— Oct 04: South Carolina lawmakers lower highest marginal tax rate retroactive to January 1, 2022 (Tax Alert 2022-1499)

— Oct 04: North Carolina makes technical and clarifying changes to its franchise tax laws (Tax Alert 2022-1492)

— Oct 03: Arkansas income tax withholding rates are updated effective October 1, 2022 to reflect law lowering the top income tax rate (Tax Alert 2022-1487)

— Sep 30: State corporate income and franchise tax developments in the third quarter of 2022 (Tax Alert 2022-1479)

— Sep 30: Puerto Rico's Treasury Department issues guidance on the tax measures and extended due dates in place because of Hurricane Fiona (Tax Alert 2022-1476)

Recent Newsletters

State and Local Tax Weekly
   Highlights of this edition include:

  • Iowa certifies corporate income tax rate reductions starting in 2023. On Sept. 27, 2022, the Director of the Iowa Department of Revenue issued Order 2022-03, certifying that the top corporate income tax rates will decrease to 8.4% in 2023 from 9.0% and 9.8%.
  • Texas Comptroller proposes amendments to local sales and use tax rules. The Texas Comptroller of Public Accounts (Comptroller) has proposed rule amendments to 34 TAC §3.334 (Section 3.334) regarding local sales and use tax. In August 2022, a Texas District Court found that the Comptroller failed to "substantially comply with" requirements of the Texas Administrative Procedure Act, specifically Tex. Gov. Code § 2001.024, in adopting amendments to 34 TAC §3.334(b)(5) [in 2020], which as amended would source online sales to the buyers location instead of the seller's business location.
  • Income/Franchise, Sales & Use, Property Tax, Compliance & Reporting, Payroll & Employment Tax, Miscellaneous Tax, Value Added Tax

ITS/Washington Dispatch
   Highlights of this edition include:

Tax treaties

  • US treaty negotiations with Israel, Switzerland set to start, pending treaties require TCJA updates

>Treasury and IRS news

  • PTEP regs coming in Q1 2023, Section 367(d) guidance possible this year
  • Treasury and IRS to issue proposed regulations on application of noncompulsory payment regs to certain amended Puerto Rico tax decrees
  • IRS Chief Counsel memo clarifies process for determining assessment statute expiration date in multi-year Section 332 liquidation

Transfer pricing news

  • Sixth Circuit rules in favor of Eaton in appeal from Tax Court regarding APA cancellation

OECD developments

  • OECD holds public consultation meeting on Progress Report on Amount A of BEPS Pillar One
  • OECD publishes Manual on Bilateral APAs

IRS Weekly Wrap-Up

Proposed Regulations

 REG-100719-21User Fees Relating to Enrolled Actuaries


 2022-52Administrative, Procedural, and Miscellaneous
 2022-51Request for Comments on Prevailing Wage, Apprenticeship, Domestic Content, and Energy Communities Requirements Under the Act Commonly Known as the Inflation Reduction Act of 2022
 2022-50Request for Comments on Elective Payment of Applicable Credits and Transfer of Certain Credits
 2022-49Request for Comments on Certain Energy Generation Incentives
 2022-48Request for Comments on Incentive Provisions for Improving the Energy Efficiency of Residential and Commercial Buildings
 2022-47Request for Comments on Energy Security Tax Credits for Manufacturing Under Sections 48C and 45X
 2022-46Request for Comments on Credits for Clean Vehicles

Internal Revenue Bulletin

 2022-41Internal Revenue Bulletin of October 11, 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.