Treasury and the IRS on September 29 released final regulations (the ‘2020 Final Regulations’) and proposed regulations (the ‘2020 Proposed Regulations’) addressing various aspects of the foreign tax credit (FTC) regime.
The 2020 Final Regulations finalize, among other provisions, the proposed FTC regulations published on December 17, 2019 (the ‘2019 Proposed Regulations’) and clarify several aspects of the new FTC regime, including the allocation and apportionment of certain deductions and creditable foreign taxes; foreign tax redeterminations; adjustments to hybrid deduction accounts to take into account certain inclusions in income by a US shareholder; conduit financing arrangements involving hybrid instruments; and the treatment of certain payments under the global intangible low-taxed income (GILTI) provisions.
Some of the key highlights we have identified in our review of the 2020 Final and Proposed Regulations are set out below. An in-depth Insight on the regulations will be published in the coming days.
