The Senate Finance Committee's version of the Republicans' budget reconciliation legislation (the “Senate Bill”) would significantly expand the qualified small business stock (QSBS) benefits under Section 1202 of the Code...more
On May 22, 2025, the U.S. House of Representatives passed a reconciliation bill (commonly referred to as the “One Big Beautiful Bill”), which would restore expensing for domestic research and development expenses incurred in...more
6/6/2025
/ Biotechnology ,
Budget Reconciliation ,
Corporate Taxes ,
Federal Budget ,
Income Taxes ,
Life Sciences ,
Proposed Legislation ,
Research and Development ,
Tax Credits ,
Tax Deductions ,
Tax Incentives ,
Tax Reform
The U.S. Department of Treasury (Treasury) recently released proposed regulations under §§ 959 and 961 and related Code sections (REG-105479-18, the “Proposed Regulations”) addressing the treatment of previously taxed...more
Bruyea v. United States (Ct. Claims Dec. 5, 2024), is the latest in a series of cases concerning whether a U.S. double tax treaty, in this case Canada's, allows a foreign tax credit for Canadian income taxes against the 3.8%...more
1/2/2025
/ Canada ,
Court of Federal Claims ,
Double Taxation ,
Foreign Tax ,
Foreign Tax Credits ,
Income Taxes ,
Internal Revenue Code (IRC) ,
International Tax Issues ,
NIIT ,
Tax Liability ,
Tax Treaty
Recently, in Exxon Mobil Corp. v. United States (No. 3:22-cv-00515), a District Court in Texas ruled that the taxpayer was entitled to interest deductions on a production loan entered into as part of a multibillion-dollar...more
12/17/2024
/ Development Agreements ,
Economic Substance Doctrine ,
Energy Projects ,
Exploration and Production Sharing Contract ,
Exxon Mobil ,
Interest Payments ,
IRS ,
Natural Gas ,
Oil & Gas ,
Partnerships ,
Production Tax Credit ,
Qatar ,
Tax Deductions
Recently, in Rawat v. Commissioner, the D.C. Circuit reversed the Tax Court decision and held that a foreign partner would not be subject to U.S. tax on selling an interest in a partnership with “hot assets” subject to §...more
8/6/2024
/ Chevron Deference ,
Foreign Partner ,
IRS ,
Loper Bright Enterprises v Raimondo ,
Partnership Interests ,
Partnerships ,
Sale of Assets ,
Statutory Interpretation ,
Tax Court ,
Tax Liability ,
Transfer of Interest
The Internal Revenue Service’s new private letter ruling (PLR) concerned a domestication of a Foreign Parent corporation under U.S. ownership—with a few notable twists. First, the PLR applied a substance-over-form analysis to...more
7/23/2024
/ Corporate Conversions ,
Corporate Restructuring ,
Domestic Corporations ,
Foreign Corporations ,
IRS ,
Parent Corporation ,
Private Letter Rulings ,
Reorganizations ,
Share Classes ,
Stock Issuance ,
Stock Sale Agreements ,
Subsidiaries ,
Tax-Free Exchanges
The book has closed on 2023, but several recent tax-related rulings are sure to have ripple effects into 2024 and beyond—particularly with respect to transfer pricing and foreign tax credits. Here are five cases that will...more
1/9/2024
/ Chevron Deference ,
Economic Substance Doctrine ,
IRS ,
Loper Bright Enterprises v Raimondo ,
Moore v US ,
Oral Argument ,
SCOTUS ,
Tax Court ,
Tax Credits ,
Taxation ,
U.S. Treasury
Following the IRS’s issuance of guidance in Notice 2023-63 regarding R&D capitalization under Section 174, a working group of several Fenwick tax group attorneys commented to the IRS and the U.S. Treasury Department on...more
11/30/2023
/ Amortization ,
Disclosure Requirements ,
Internal Revenue Code (IRC) ,
IRS ,
Life Sciences ,
New Guidance ,
Proposed Regulation ,
Research and Development ,
Research and Experiment Tax Credit ,
SEC Comment Letter Process ,
Tax Cuts and Jobs Act ,
Tax Deductions ,
Taxation ,
Technology Sector ,
U.S. Treasury
Released on September 8, 2023, IRS Notice 2023-63 provides wide-ranging and potentially controversial guidance on the capitalization and amortization of research and experimentation expenses under section 174....more
One of the more significant issues that taxpayers and tax practitioners have faced in recent months is the Tax Cuts and Jobs Act’s (TCJA) amendment to Section 174, requiring capitalization of previously deductible R&D and...more
In the newly released Proposed Foreign Tax Credit (FTC) Regulations, Treasury provided some measure of relief on cost recovery and royalty withholding, two of the most troublesome aspects of the Final FTC Regulations that...more
Taxpayers with royalties owing from a foreign affiliate may wish to negotiate a prepayment of the future royalty stream for a lump sum price. This could include accelerating foreign source income or repatriating cash from a...more
Introduction On August 16, President Biden signed into law the Inflation Reduction Act of 2022, P.L. 117-169 (IRA). The law addresses a range of issues, from climate change to energy security to prescription drug prices for...more
Last month, Senate Finance Committee Chair Ron Wyden of Oregon and fellow Finance Committee Democrats Sherrod Brown of Ohio and Mark Warner of Virginia released a draft proposed overhaul of the international tax regime (the...more
A few weeks ago, the IRS released a new “practice unit” providing training for its examiners on translation of foreign currency gains and losses of branches (so-called qualified business units, or QBU) under §987....more
Foreign exchange gain or loss is a feature of most cross-border business activity and has tax implications under two different sets of rules governing foreign currency transactions (§ 988) and foreign currency translation (§§...more
On March 20, 2020, Treasury and the IRS released final regulations under Section 901(m). The regulations were published in the Federal Register on March 23, and generally apply to covered asset acquisitions (CAAs) occurring...more
The Tax Cuts and Jobs Act (TCJA) repealed the long-standing “50/50” sourcing rule for United States exporters of manufactured products. Under the new rules, which source income of a “producer” solely to the place of...more
1/29/2020
/ Cross-Border Transactions ,
Exports ,
Foreign Derived Intangible Income (FDII) ,
Foreign Tax Credits ,
Imports ,
Inventory ,
IRS ,
Manufacturers ,
Natural Resources ,
Pass-Through Entities ,
Proposed Regulation ,
Qualified Business Income ,
Resource Extraction ,
Section 199A ,
Tax Cuts and Jobs Act ,
U.S. Treasury
In 2019, we published analysis to help tech and life sciences companies navigate U.S. tax law changes, an evolving IP landscape and new privacy regulations such as the California Consumer Privacy Act. We also tracked venture...more
1/8/2020
/ ABC Test ,
California Consumer Privacy Act (CCPA) ,
Consumer Privacy Rights ,
Convertible Debt ,
Corporate Governance ,
Data Privacy ,
Debt Financing ,
Direct Listing ,
Diversity ,
Emerging Technology Companies ,
Employer Liability Issues ,
Foreign Tax Credits ,
Hiring & Firing ,
Independent Contractors ,
Intellectual Property Litigation ,
Intellectual Property Protection ,
Internal Revenue Code (IRC) ,
IRS ,
Life Sciences ,
Misclassification ,
New Guidance ,
Pharmaceutical Industry ,
Privacy Laws ,
Proposed Regulation ,
Proxy Season ,
Silicon Valley ,
Startups ,
Tax Credits ,
Tax Cuts and Jobs Act ,
Venture Capital ,
Withholding Tax ,
Woman Board Members
On December 2, 2019, Treasury and the IRS released final and proposed regulations on the foreign tax credit. As expected, the final regulations finalize the 2018 proposed regulations relating mainly to the Tax Cuts and Jobs...more
1/6/2020
/ Controlled Foreign Corporations ,
Corporate Taxes ,
Final Rules ,
Foreign Earned Income ,
Foreign Tax Credits ,
GILTI tax ,
Income Taxes ,
International Tax Issues ,
Proposed Regulation ,
Tax Credits ,
Tax Cuts and Jobs Act ,
Tax Planning ,
U.S. Treasury
We receive many questions from founders, investors and others about qualified small business stock. And it’s no wonder, given the complexity of the concept. In this article, we provide a high-level overview of QSBS. A...more
On October 9, 2019, the IRS released Revenue Ruling 2019-24, which provides guidance with respect to hard forks and airdrops of cryptocurrency, and new frequently asked questions (FAQs), which provide guidance on other...more
10/14/2019
/ 1099s ,
Blockchain ,
Capital Gains ,
Cryptocurrency ,
Distributed Ledger Technology (DLT) ,
Fair Market Value ,
Income Taxes ,
IRS ,
New Guidance ,
Peer-to-Peer ,
Popular ,
Revenue Rulings ,
Transfer Taxes ,
Virtual Currency ,
W-2
The new regulations proposed in September under Section 382(h) regarding built-in-gain raise several international tax issues that companies planning for post-acquisition integration of loss corporations should be aware of....more
10/7/2019
/ Acquisitions ,
Built-In Gains ,
Change of Ownership ,
Corporate Taxes ,
GILTI tax ,
IRS ,
Loss Limitation Rules ,
Mergers ,
Net Operating Losses ,
New Rules ,
Proposed Regulation ,
Section 382 ,
Tax Exemptions ,
Tax Planning
Treasury and the IRS have issued proposed regulations filling a number of gaps and providing necessary guidance on the Base Erosion and Anti-Abuse Tax (BEAT). In general, the guidance is reasonably consistent with the statute...more