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  • videocam On-Demand
  • signal_cellular_alt Intermediate
  • card_travel Corporate Tax
  • schedule 110 minutes

Deducting Interest Paid by Multinational Corporations: Section 163(j), 263(a)(3), Thin Capitalization Rules, OECD

$247.00

This course is $0 with these passes:

CPE
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Description

Multinational corporations have historically structured loans with related companies in low-tax countries, creating large interest deductions that lower domestic taxes paid in high-tax rate countries, more or less converting equity into debt. Many countries, including the U.S., impose restrictions on these tax avoidance transactions and have enacted legislation restricting interest deductions.

Some countries have enacted earnings stripping or thin-capitalization rules to limit international debt shifting. Following OECD recommendations, Australia recently implemented an earnings-based test to restrict interest deductions to 30 percent of EBITDA effective July 1, 2023. In Europe, most countries have thin-capitalization rules in place using either earnings stripping or safe harbor rules to limit interest deductions.

In the U.S., Section 163(j) limits interest deductions to 30 percent of "adjusted taxable income." At the same time, 267(a)(3) requires MNCs to use the cash method of accounting for foreign intercompany debt deductions regardless of the method of accounting employed by the company. Tax practitioners working with overseas businesses must grasp the complexities of international debt deductions.

Listen as our panel of foreign tax experts analyzes the latest developments for deducting international interest payments.

Presented By

Surbhi Bordia
Partner
Armanino, LLP

Ms. Bordia has over 10 years of public accounting experience. She addresses complex tax issues that impact international companies’ operations and puts tax efficient structures in place for her clients. Ms. Bordia’s hands-on experience in international tax, IP migration planning and legal entity rationalizations make her an expert consultant and key team player for clients in mergers and acquisitions. Ms. Bordia’s focus areas include GILTI, BEAT, FDII, anti-hybrid rules, foreign tax credits, subpart F, withholding tax, investments in U.S. property, FX gains and losses, treaty-related issues, outbound transfers and permanent establishment and profit attribution rules.

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William R. Skinner
Partner
Fenwick & West LLP

Mr. Skinner focuses his practice on U.S. international taxation, with a particular emphasis on tax planning and international corporate transactions. He has broad experience in international tax issues for U.S. corporations, foreign corporations, and high net-worth individuals, and has represented clients across a variety of industries. He teaches international taxation as an adjunct professor in San Jose State University’s MST program, and speaks and writes frequently on international and corporate tax issues.

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Credit Information

  • 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).

Date + Time

  • event

    Tuesday, November 28, 2023

  • schedule

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

  1. Introduction: deducting interest overseas
  2. U.S. rules
    1. 267(a)(3)
    2. 163(j)
    3. Other restrictions
  3. Update on non-U.S. and OECD developments
  4. Other considerations

The panel will cover these and other critical issues:

  • How 163(j) impacts interest deductions for MNCs
  • The impact of 263(a)(3) on interest expense between related foreign taxpayers
  • OECD recommendations for interest limitation rules
  • Suggestions for structuring international related party debt

Learning Objectives

After completing this course, you will be able to:

  • Identify specific countries' responses to international debt shifting by MNCs
  • Determine how 267(a)(3) affects interest deductions between MNC related parties
  • Decide how OECD's recommendations impact rules limiting interest deductions
  • Ascertain how 163(j) restricts foreign taxpayer's interest deductions
  • 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.

BARBRI 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

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

BARBRI CE webinars-powered by Strafford-are backed by our 100% unconditional money-back guarantee: If you are not satisfied with any of our products, simply let us know and get a full refund. Contact us at 1-800-926-7926 .