Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

January 20, 2023
2023-5088

Report on recent US international tax developments – 20 January 2023

On 8 July 2022, the United States (US) Treasury officially began the process of terminating the US-Hungary Tax Treaty (signed in 1979). According to the Treasury Press Release, termination of the Treaty is effective on 8 January 2023, and with respect to taxes withheld at source, the Convention shall cease to have effect on 1 January 2024. On 27 December 2022, the text of a joint statement between the US and Hungary (Statement) was posted on the Internal Revenue Service (IRS) Country-by-Country (CbC) Reporting Jurisdiction Status Table.

The Statement acknowledges that the 2018 Agreement on Exchange of Country-by-Country Reports is expected to terminate on 8 January 2023 and provides that the US and Hungary are in the process of negotiating an intergovernmental agreement and competent authority arrangement to allow for the automatic exchange of CbC Reports. Prior to entry into force of these agreements, the Statement outlines agreements reached with respect to exchange of CbC Reports for fiscal years commencing 1 January 2021.

In an IRS Chief Counsel Memorandum (CCA 202302011) dated 10 January 2023, the Government concluded that cryptocurrency that has declined in value – even to less than a penny per unit – is not considered a deductible Internal Revenue Code 165 worthless loss if the taxpayer took no action to abandon the property right. According to the facts, the cryptocurrency continued to be traded on at least one exchange and the IRS noted that it “had liquidating value, though it was valued at less than one cent at the end of 2022.”

The Organisation for Economic Co-operation and Development announced on 13 January that former US Treasury official Manal Corwin will become director of the Centre for Tax Policy and Administration (CTPA), replacing Grace Perez-Navarro who will retire on 31 March. Perez-Navarro, who was the deputy director of the CTPA, became the director after long-time head Pascal Saint-Amans left the position in October 2022.

_________________________________________

For additional information with respect to this Alert, please contact the following:

Ernst & Young LLP (United States), International Tax and Transaction Services, Washington, DC

 
 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 2024, Ernst & Young LLP.

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.

 

"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

 

Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.

 


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or ey.com. Please refer to the privacy notice/policy on these sites for more information.


Yes, I accept         Find out more