Federal Tax

On June 14, 2016, members from Regions VI and VII enjoyed a wide-ranging and insightful discussion with local and national LB&I executives at the University of Illinois Business Center in Chicago, Illinois. Special congratulations and thanks go out to Region VI leadership, notably RVP Janet Kreilein, who led the planning and organization of this year’s event. LB&I’s recent restructuring and the reengineering of its examination process fostered a lively conversation benefitting both TEI members and LB&I officials.

On April 13, 2016, the IRS released a revised Form W-8BEN-E, which foreign entities must provide to withholding agents of their U.S.-sourced income under the FATCA regime. The form was last updated in 2014. The updated form includes ten new checkboxes in Part III, Question 14.b, for indicating which limitation-of-benefits treaty provision applies when claiming treaty benefits. Responses to this question are not intuitive, and the question may cause confusion, particularly if individuals charged with completing the form are not familiar with the reporting company's treaty positions.

On February 23-24, 2016, a delegation from Tax Executives Institute met with the Commissioner of Internal Revenue, John Koskinen, and senior officials of the Internal Revenue Service and with the Treasury Department’s Assistant Secretary for Tax Policy, Mark Mazur, and senior officials of Treasury’s Office of Tax Policy.

The detailed agendas TEI submitted to the IRS and Treasury Department before the meetings are provided below.

On February 16, 2016, TEI submitted comments to the Internal Revenue Service offering a definition of "minor assembly" for purposes of the domestic production activities deduction ("DPAD") of 26 U.S.C. § 199. We submitted these comments pursuant to the REG-136459-09 notice of proposed rulemaking, which proposed various changes in the regulations surrounding the DPAD. These comments also offered an alternative new Example 9 from what was suggested in REG-136459-09, an example generally regarding as attempting to overturn by regulation the holding in United States v. Dean, 945 F. Supp.

On February 10, 2016, TEI submitted a comment letter to the Financial Accounting Standards Board concerning the FASB's proposal to require public disclosure of material terms and conditions of government assistance agreements.

TEI and other stakeholder groups recently met with representatives of the IRS’s Large Business and International Division to review and offer comments on five draft research credit directives. Overall, the dialogue at the meeting was constructive, but the effort to involve stakeholders and obtain their insights could have been more productive. In its September 15, 2015 letter to LB&I, TEI offered observations on the process used to solicit stakeholder input, as well as the content of the draft directives.

On August 3, 2015, TEI submitted comments to the IRS on proposed regulations (REG-132634-14) relating to qualifying income from activities of publicly traded partnerships with respect to minerals or natural resources. The Institute’s comments focused on how the proposed regulations fail to capture the complex processes and activities carried on by publicly traded partnerships and, as a result, propose rules that are inconsistent with section 7704(d)(1)(E) and its legislative history as previously interpreted and applied by the IRS in 27 years of ruling practice.

On February 26-27, 2015, a delegation from Tax Executives Institute met with the Commissioner of Internal Revenue, John Koskinen, and senior officials of the Internal Revenue Service and with the Treasury Department’s Assistant Secretary for Tax Policy, Mark Mazur, and senior officials of Treasury’s Office of Tax Policy. Summaries of the meetings are provided below.

On June 4-5, 2014, a delegation from Tax Executives Institute met with the Commissioner of Internal Revenue, John Koskinen, and senior officials of the Internal Revenue Service and with the Treasury Department’s Assistant Secretary for Tax Policy, Mark Mazur, and senior officials of Treasury’s Office of Tax Policy. The agendas and minutes from the meetings are provided below.

On March 18, 2014, TEI urged the IRS to withdraw proposed regulations creating an "exception" to the single taxpayer rule under section 41(f)(1) excluding gross receipts received from a controlled foreign corporation for purposes of calculating the traditional incremental research credit.

TEI's comments were prepared under the aegis of its Federal Tax Committee, whose chair is Gary P. Hickman of Oldcastle, Inc. Jeffery P. Rasmussen of the Institute's legal staff coordinated the development of the comments.