The U.S. Treasury Department and IRS today released for publication in the Federal Register final regulations (T.D. 9796) that treat a domestic disregarded entity, wholly owned by a foreign person, as a domestic corporation for the limited purposes of the reporting and recordkeeping requirements under section 6038A.
The final regulations [PDF 206 KB] amend existing regulations under section 6038A and section 7701, and will require affected domestic disregarded entities to file Form 5472 at such time and in such manner as the IRS Commissioner may prescribe in forms or instructions.
Today’s release finalizes regulations that were proposed in May 2016 with “a limited number of changes” including:
Regulations proposed in May 2016 provided that domestic disregarded entities—deemed to be foreign-owned domestic corporations—would be required:
The preamble to today’s final regulations and the text of the final regulations clarify that:
The final regulations also provide that they apply to tax years of entities beginning on or after January 1, 2017, and ending on or after December 13, 2017 (whereas the proposed regulations would have applied to tax years ending on or after the date that was 12 months after the date of publication of the final regulations in the Federal Register, without regard to the date on which the tax year began).
The final regulations will be published in the Federal Register on December 13, 2016.
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