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On 2 April 2018, Treasury and the IRS released Notice 2018-26, signaling intent to issue regulations related to mandatory repatriation (the 'toll tax').  Notice 2018-26 is the third notice issued as part of the transition to a new territorial tax regime under the 2017 Tax Reform Reconciliation Act, also known as the ‘Tax Cuts and Jobs Act.’ 

Notice 2018-26 is effective for the last taxable year of a foreign corporation that begins before 1 January 2018 and is effective for a US shareholder in the taxable year when its foreign corporation ends, meaning it is retroactive to US shareholders’ toll tax inclusion years.  Additionally, Treasury and the IRS request comments on the rules described in the Notice 2018-26 and on what additional guidance should be issued to assist taxpayers in computing the toll tax