Final regulations posted by the IRS on Monday ( T.D. 9943 ) provide additional guidance regarding the limitation on the business interest expense deduction under Sec. 163(j) to reflect amendments made by the law known as the Tax Cuts and Jobs Act, P.L. 115-97, and the Coronavirus Aid, Relief, and Economic Security (CARES) Act, P.L. 116-136.
Sec. 163(j) generally limits the amount of business interest expense that can be deducted in the current tax year. Under Sec. 163(j)(1), a taxpayer's deduction for interest is limited to the sum of (1) the taxpayer's business interest income for the tax year; (2) 30% of the taxpayer's adjusted taxable income for the tax year; and (3) the taxpayer's floor plan financing interest expense for the tax year (in sum, the Sec. 163(j) limitation).
Quite a lot has been going on:
IRS Aims to Tackle International Issues, Reform Law in New Year
The year ahead will be a busy one for the IRS, as the agency wraps up guidance tied to the 2017 tax law and takes on new projects.
Finishing rules stemming from the tax overhaul was a goal the IRS set for itself in 2020. But the scope of the task —dozens of proposed and final packages—have left some spilling into the new year. And once the IRS checks off tax overhaul guidance, the next focus areas include a top-down agency reform law.
"They've been trying to hurry it along, but I think it's going to be a challenge to get everything out," Lisa Zarlenga, partner at Steptoe & Johnson LLP said.
Gibson Dunn | DAC 6 Update: UK Narrows Scope of Mandatory Tax Reporting
In a surprise u-turn, on 31 December 2020, the UK government took steps to narrow the scope of mandatory reporting under DAC 6. In the UK, only cross-border arrangements falling under the Category D hallmark (broadly, those that (a) have the effect of circumventing the OECD's Common Reporting Standard or (b) obscure beneficial ownership) will be reportable. The change will apply to both historic, and future, cross-border arrangements.
The amendment to the existing legislation is intended as a temporary step. In the coming year, the UK intends to introduce, and consult on, legislation to implement mandatory reporting under the OECD Mandatory Disclosure Rules (the "MDR").
Deloitte and Tax Analysts Take Great Strides to Increase Tax Policy Transparency | State |
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While you're here, how about this:
Changes to Renewable and Carbon Capture Tax Credits for 2021
On December 22, 2020, the U.S. House and Senate approved the Consolidated Appropriations Act, 2021 (the 2021 Act) and, on December 27, 2020, President Trump signed the 2021 Act into law. The 2021 Act extends tax credits currently available for solar, wind, and carbon capture, storage and use projects, and provides a new tax credit for offshore wind projects.
Section 48(a) of the Internal Revenue Code of 1986, as amended (the Code), permits an investment tax credit (ITC) for a percentage of the tax basis of the energy property placed in service during a particular taxable year. For solar projects, such percentage generally is based on the calendar year when construction of the solar project begins, subject to an annual phase down. The 2021 Act extended the eligibility deadline for each ITC percentage by two years, as follows:
Netherlands Gazettes Decision Amending Tax Implementation Regulations
The Dutch Official Gazette Dec. 31, 2020 published Decision No. 64029, amending tax implementation regulations.
Investors reposition for stimulus, spending and tax as they look to Biden | Reuters
NEW YORK/LONDON/SYDNEY (Reuters) - Investors are looking ahead to the next U.S. administration after Democrats won control of Congress on Wednesday, a political shift that could strengthen the hand of President-elect Joe Biden in pushing through policies such as more fiscal spending and higher taxes.
Reports of the attacks on the U.S. Capitol briefly shook markets, but investors said the impact would be temporary at best.
NCFC presses for 'grain glitch' action | 2021-01-05 | Agri-Pulse Communications, Inc.
The Trump administration is unlikely to make a needed fix to tax regulations for farmer co-operatives, leaving many growers at risk of seeing higher tax bills, according to the National Council of Farmer Cooperatives.
NCFC already is reaching out to representatives of the incoming Biden administration to address the issue, NCFC President Chuck Conner told Agri-Pulse Tuesday.
At issue are regulations the Internal Revenue Service has been writing to implement the Section 199A tax deduction, an issue that became known as the "grain glitch" after the deduction was rewritten as part of the 2017 tax law. The IRS is expected to soon finalize regulations that would limit the deduction to patronage income, or income from co-op members. It would not apply to income from non-members.
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