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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Tax Law

Date & Time
  • event Date

    Wednesday, August 17, 2022

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

  • BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.

  • BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).

$347.00
CLE
CPE
ALL

This CLE/CPE webinar will provide tax counsel and advisers with an in-depth analysis of the tax treatment of foreign branches of U.S.-based companies under current tax law. The panel will discuss what constitutes a foreign branch, reporting obligations, foreign tax credits, recent 267A anti-hybrid regulations, and other critical considerations for tax professionals.

Faculty

Brian D. Dill
Partner, Tax Services
Cherry Bekaert

Mr. Dill is Partner in charge of international tax. With over 20 years of experience he has extensive experience in forming and leading multi-jurisdictional teams from various disciplines on projects involving complex global tax issues, which have included global M&A, tax structuring, transfer pricing, withholding taxes/FATCA, VAT, tax attribute preservation and utilization, boycott operations, and foreign currency.

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David J. Warner
Tax Attorney, Shareholder & Managing Principal
Holtz, Slavett & Drabkin, APLC

Mr. Warner is a Tax Attorney and the Managing Attorney of the Orange County Office of Holtz, Slavett & Drabkin. He has over 10 years of experience practicing in all aspects of tax controversy including tax audits, collection defense, and litigation in the U.S. Tax Court, U.S. District Court, and the Court of Federal Claims. He represents taxpayers in cases involving income tax, estate tax, gift tax, employment tax, collection issues, innocent spouse, penalties, and bankruptcy tax issues. He also represents taxpayers before the California Franchise Tax Board (FTB), Department of Fee and Tax Administration (CDTFA, formerly State Board of Equalization (BOE)), and Employment Development Department (EDD). He has particular expertise in tax matters involving individuals and small businesses, the examination of partnerships and S corporations, and offshore tax compliance issues, including the Report of Foreign Bank and Financial Accounts (FBAR), civil fraud, and offshore information return penalties.

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Description

U.S. companies conducting business in another country through a branch or foreign entity face complex tax issues and reporting requirements. Tax counsel and advisers must understand the U.S. tax treatment of foreign branch income, the applicability of Section 267A anti-hybrid regulations, obtaining the foreign tax credit, and other tax issues.

A foreign branch is a trade or business operated in a foreign country that maintains its books and records. Although Section 989 defines a foreign branch as a qualified business unit, whether or not it is a trade or business is a facts-and-circumstances determination.

In addition, foreign branch income rules make the existence of a foreign branch far more significant than it had been before the 2017 tax reform. Some U.S. companies may consider transferring the assets of their foreign branch to a controlled foreign corporation and electing not to be treated as a disregarded entity. However, this will result in any gain realized to be subject to full U.S. taxation, with any branch losses being subject to recapture rules.

Generally, taxpayers report income or loss from a foreign branch on a U.S. consolidated income tax return. Reporting branch income provides additional complexities. Advisers must analyze allocation and reallocation rules for foreign branch income to calculate the allowable foreign tax credit. Foreign branch income is ineligible for the Section 250 FDII deduction, which allows a 13.25 percent reduction of the 21 percent corporate tax rate.

Listen as our panel of foreign tax experts explains the tax considerations of operating a foreign branch, including planning strategies to lower the overall tax burden of multinational trade or businesses.

Outline

  1. U.S. tax treatment of foreign branches
  2. Reporting requirements and ensuring compliance
  3. Comparison with foreign subsidiaries
  4. 267A anti-hybrid rules
  5. Foreign tax credits
  6. Best practices and planning strategies

Benefits

The panel will review these and other critical issues:

  • What constitutes a foreign branch?
  • What are the applicable rules and available planning?
  • Who is required to file Form 8858 and Schedule M?
  • What is a branch mismatch payment under Section 267A?
  • What are the differences between a foreign subsidiary and a foreign branch?
  • How to obtain the foreign tax credit

NASBA Details

 

Learning Objectives

After completing this course, you will be able to:

  • Identify specific examples of foreign trade or businesses
  • Determine how to allocate foreign branch income to determine the foreign tax credit
  • Decide who should file Form 8858, Information Return of U.S. Persons With Respect to Foreign DREs and Foreign Branches
  • Ascertain specific taxation differences between foreign subsidiaries and foreign branches

  • Field of Study: Taxes
  • Level of Knowledge: Intermediate
  • Advance Preparation: None
  • Teaching Method: Seminar/Lecture
  • Delivery Method: Group-Internet (via computer)
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
  • Prerequisite:

    Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of international taxation including residency determination, foreign entity classifications, application of treaty benefits, as well as GILTI, Subpart F, and the related Section 250 deductions.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).