Category Archives: TCJA

The Tax Cuts and Jobs Act of 2017 introduces major reforms to the international taxation of U.S. corporations

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Reprinted From The Winter 2018 Issue Of ALI-CLE’s The Practical Tax LawyerWinter 2018 Edition On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act (“TCJA”) of 2017, P.L. 115-97, which introduced a set of tax cuts and other reforms that will affect substantially all U.S. taxpayers, both corporate and individual. The key feature of the new … read more –>

Repatriation of foreign-sourced accumulated earnings in transitioning to a participation exemption system for reporting foreign-sourced dividends under the Tax Cuts and Jobs Act

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On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act (TCJA) of 2017, P.L. 115-97, which introduced a wholesale set of tax cuts and other reforms that affect substantially all U.S. taxpayers, both corporate and individual.

One of the highlights of the new law is the repatriation of foreign-sourced accumulated earnings and profits with respect to controlled foreign corporations (CFCs) as defined.[1] Newly enacted section 965 imposes a transition tax on the accumulated (and untaxed) foreign earnings of foreign subsidiaries of US companies by constructive (mandatory) repatriation under section 951(a)(1). Foreign earnings held in the form of cash and cash equivalents are taxed at a 15.5% rate and the residual untaxed foreign earnings are taxed a rate of 8%. The “transition tax” may be paid in installments over an 8 year period.

Congress gets ready to pass historic “Tax Cuts and Jobs Act”; a look at the complex new world of the qualified business deduction rule applicable to partnerships, S corporations and sole proprietors

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Adapted from an article to be published in the January, 2018 issue of the CPA Journal which is the official journal of the NY State Society of CPAs

By the time this article is published, we will know whether the new tax law was enacted by Congress and signed into law by President Trump.  While the conference committee resolved the differences between the bills, and there indeed were many differences, at this point the conference agreement has selected the provisions going forward for the final vote of Congress.  This article will focus on the new reforms to the tax rates applied to owners of unincorporated businesses with respect to qualified business income.

This summary is based on the conference committee report released on December 15 with respect to the versions of the Tax Cuts and Jobs Act passed by the House of Representatives on November 16, 2017 and then by the Senate on December 2, 2017. The mangers of the House and Senate tax-writing committees included a Joint Explanatory Statement of the Committee of Conference on December 16, 2017 along with a version of the tax bill.

Republican GOP tax bill introduces major reforms to the taxation of US corporations engaged in business operations overseas: Introduction of the participation exemption.

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Overview of need for reform of income taxation of US corporations with respect to foreign subsidiaries As promised from various talks and presentations leading up to the introduction of H.R. 1, 115TH Cong., 1st Sess., the Tax Cuts and Jobs Act, as well as the recent Republican Unified Framework for Tax Reform, released September 27, 2017, the GOP Bill introduces … read more –>