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

April 14, 2023
2023-5421

Report on recent US international tax developments — 14 April 2023

The US House and Senate will be back in session on 17 April, after a two-week break. Rapidly approaching, the Biden Administration and Congress will need to reach agreement on the debt limit by around mid-year to avoid default, given that Treasury is already using extraordinary measures to borrow additional funds without breaching the debt ceiling. Before the break, President Biden indicated he would not negotiate spending cuts and wants no conditions on extending the debt limit. House Speaker Kevin McCarthy (R-CA) has said, however, there is no possibility congressional Republicans will accept a "clean" debt limit without spending cuts.

Congressional Republicans want a leaner budget that balances in 10 years, provided by reducing nondefense discretionary spending, reclaiming unspent COVID funds, strengthening work requirements for federal programs, and adding measures to lower energy costs.

The IRS issued proposed rules (REG-109309-22) this week that would obsolete Notice 2016-66 and identify transactions that are the same as, or substantially similar to, certain micro-captive transactions as listed transactions and other micro-captive transactions as transactions of interest. Material advisors and certain participants in these listed transactions and transactions of interest must file disclosures with the IRS or face penalties.

The IRS also released Announcement 2023-11, which explains that the rules are being proposed in light of certain court decisions holding that the Administrative Procedure Act requires the IRS to identify listed transactions through notice-and-comment rulemaking, and that the IRS intends to issue further regulations identifying other listed transactions, to be finalized in 2023.

A public hearing is scheduled for 19 July 2023; comments on the regulations may be sent to the IRS through 10 June 2023.

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

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

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor

 
 

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