Treasury and the IRS have released proposed regulations and a revenue procedure addressing the repeal of section 958(b)(4). Prior to its repeal by the Tax Cuts and Jobs Act, section 958(b)(4) prevented downward attribution from a foreign person for purposes of determining whether a foreign entity was a controlled foreign corporation under section 957. The proposed regulations address the impact of the repeal on various other Code provisions, such as sections 267, 332, and 1297. The revenue procedure describes changes made with respect to filing requirements to Form 5471 and also provides safe harbors for determining whether a foreign corporation is a CFC and determining certain items required to be reported with respect to foreign corporations based on alternative information when otherwise-required information is not readily available.

Read the Proposed Regulations: REG-104223-18

Read the Revenue Procedure: Rev. Proc. 2019-40