- The IRS will consider requests from owners seeking relief from double taxation under new repatriation rules, the agency announced Friday.
- The Tax Cuts and Jobs Act, enacted at the end of 2017, amended Section 965, which requires owners to pay a tax on certain earnings of foreign corporations.
- "In unique circumstances, such as where a corporation paid an unusual dividend for business reasons, not because of the enactment of the Tax Cuts and Jobs Act, it may be appropriate to provide relief from double taxation," the IRS said.
The IRS said it envisions only a few instances in which double taxation would trigger relief. Among them: "When the same earnings and profits of foreign corporations are taxed both as dividends and under section 965."
To be considered, there could be "no significant reduction in the resulting tax by application of foreign tax credits, such that the taxpayer would be required to pay more tax than it would have if the dividend had not been paid," the IRS said.
If you have fact patterns that appear to fit these limited circumstances, the IRS said, bring them to the agency's attention by contacting the Office of Associate Chief Counsel (International), at (202) 317-3800.