Today, Treasury and the IRS issued Notice 2015-79 providing additional guidance aimed at further reducing the tax benefits of corporate inversions. The guidance is of three types: (1) corrections to Notice 2014-52 (previous inversion guidance); (2) measures to inhibit “out from under” transfers of controlled foreign corporations in inversions completed on or after September 22, 2014, the date of Notice 2014-52; and (3) measures aimed at structures in which the new foreign parent is tax resident outside its country of organization and a measure strengthening the “anti-stuffing rules”.
Phillip R. West, chairman of Steptoe and head of the firm’s Transactions and Tax Department, commented, “It is likely that recently announced deals prompted new urgency for releasing these rules, but it is equally evident that they have been under consideration for longer than the period since the biggest of those recent deals was announced.” He further noted that “as expected, Treasury coupled the guidance with another warning that inversions can be most effectively curtailed only with legislation.”
A fact sheet on Notice 2015-79 can be accessed here.
For DTU coverage of prior inversion guidance, click here.