Treasury Department Proposed Rule

2024-19027: Rules Regarding Dual Consolidated Losses and the Treatment of Certain Disregarded Payments; Correction

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Summary

This document contains corrections to the proposed regulations (REG-105128-23), published in the Federal Register on August 7, 2024. The proposed regulations concern certain issues arising under the dual consolidated loss rules and the application of those rules to certain foreign taxes. The proposed regulations also include rules regarding certain disregarded payments that give rise to losses for foreign tax purposes.

The agency’s own summary, as published.

The rule, in full

780 words as published, September 03, 2024. View the original →

Federal Register, Volume 89 Issue 170 (Tuesday, September 3, 2024) [Federal Register Volume 89, Number 170 (Tuesday, September 3, 2024)] [Proposed Rules] [Pages 71214-71215] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 2024-19027] ----------------------------------------------------------------------- DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Parts 1 and 301 [REG-105128-23] RIN 1545-BQ72 Rules Regarding Dual Consolidated Losses and the Treatment of Certain Disregarded Payments; Correction

Agency

Internal Revenue Service (IRS), Treasury.

Action

Notice of proposed rulemaking; correction. -----------------------------------------------------------------------

Summary

This document contains corrections to the proposed regulations (REG-105128-23), published in the Federal Register on August 7, 2024. The proposed regulations concern certain issues arising under the dual consolidated loss rules and the application of those rules to certain foreign taxes. The proposed regulations also include rules regarding certain disregarded payments that give rise to losses for foreign tax purposes.

Dates

Written or electronic comments and requests for a public hearing are still being accepted and must be received by October 7, 2024.

For Further Information Contact

Andrew L. Wigmore at (202) 317-5443 (not a toll-free number).

Supplementary Information

Background The proposed regulations (REG-105128-23) subject to this correction are proposed to be issued under sections 1502 and 1503(d) of the Internal Revenue Code. Correction of Publication Accordingly, FR Doc. 2024-16665 (REG-105128-23), appearing on page 64750 in the Federal Register on Wednesday, August 7, 2024, is corrected as follows: 0

1. On page 64753, in the third column, in the second partial paragraph,

the third sentence is corrected to read ``Where a taxpayer uses a fiscal year for tax purposes that ends after 2023, the foreign use exception is conditioned on the relevant MNE Group using the same fiscal year when applying the GloBE Model Rules.''. 0

2. On page 64762, in the third column, in the first full paragraph, the

third sentence is corrected to read ``The disregarded payment loss generally measures the entity's net loss, if any, for foreign tax purposes that is composed of certain payments that are disregarded for U.S. tax purposes as transactions [[Page 71215]] between the disregarded payment entity and its tax owner (for example, a payment by the disregarded payment entity to the specified domestic owner or to another disregarded payment entity of the specified domestic owner).''. Sec. 1.1502-13 [Corrected] 0

3. On page 64768, in the first column, in Sec. 1.1502-13, the first

sentence of paragraph (j)(15)(x)(C) is corrected to read ``The facts are the same as in paragraph (j)(15)(x)(A) of this section, except that for the years at issue, B's interest expense deduction would be limited under the domestic use limitation rule of Sec. 1.1503(d)-4(b) (and no exception under Sec. 1.1503(d)-6 applies) and is not currently deductible.''. 0

4. Starting on page 64771, in amendatory instruction 3, in Sec.

1.1503(d)-1: 0 a. On page 64771, in the second column, paragraph (d)(6)(ii)(C)(2) is corrected. 0 b. On page 64771, in the second and third columns, paragraph (d)(6)(ii)(D)(2) is corrected. 0 c. On page 64772, in the second column, the last sentence of paragraph (d)(7)(v) is corrected. The corrections read as follows: Sec. 1.1503(d)-1 [Corrected] * * * * * (d) * * * (6) * * * (ii) * * * (C) * * * (2) The payment, accrual, or other transaction giving rise to the item is disregarded for U.S. tax purposes as a transaction between a disregarded entity and its tax owner (for example, a payment by a disregarded entity to its tax owner or to another disregarded entity held by its tax owner, or a payment from a dual resident corporation to its disregarded entity. * * * * * (D) (2) The payment, accrual, or other transaction giving rise to the item is disregarded for U.S. tax purposes as a transaction between a disregarded entity and its tax owner (for example, because it is a payment to a disregarded entity from the disregarded entity's tax owner or from another disregarded entity held by its tax owner, or a payment to a dual resident corporation from its disregarded entity). * * * * * (7) * * * (v) * * * For purposes of this paragraph (d)(7)(v), the term hybrid mismatch rules has the meaning provided in Sec. 1.267A-5(a)(10). * * * * * Sec. 1.1503(d)-7 [Corrected] 0

5. On page 64774, in the second column, amendatory instruction 7.12 for

Sec. 1.1503(d)-7 is corrected to read ``In paragraph (c)(26)(i), removing the language from the sixth sentence `all of the interests' and adding the language `90 percent of the interests' in its place.''. Oluwafunmilayo A. Taylor, Chief, Publications and Regulations Section, Associate Chief Counsel (Procedure and Administration). [FR Doc. 2024-19027 Filed 8-30-24; 8:45 am] BILLING CODE 4830-01-P

What this changes

Amends 2 parts of the Code of Federal Regulations — the standing rules this notice rewrites.

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