IRS Issues Notice to Explain New Toll Tax
By Douglas Nakajima, International Tax Co-Leader
On March 13, 2018, the Internal Revenue Service issued additional guidance to help taxpayers meet their filing and payment requirements under the new Section 965 transition tax.
The Tax Cuts and Jobs Act requires certain taxpayers that have untaxed foreign earnings and profits to pay a tax as if those earnings and profits had been repatriated to the United States. The Act’s provisions outline details on the mandatory addition to income, the tax rates to be applied, and the availability of certain elections to determine the timing and amount of tax payments.
In advance of the March 15 and April 17 filing deadlines, IRS released additional information in a Question and Answer format to address some of the many questions raised by the new law, including how to report the additional income and pay the associated tax liability. The IRS is expected to issue more guidance and other information in the coming weeks ahead of the April 17 deadline.
The current guidance can be reviewed at https://irs.gov.
Marcum will continue to monitor developments regarding the transition tax. If you have any questions, please contact your Marcum tax professional.