Daily Tax Report ®

IRS Keeps Compliance Hoops for Companies in Tax Abuse Rules (1)

April 7, 2020, 3:44 PMUpdated: April 7, 2020, 8:35 PM

Companies now have more clarity on rules targeting cross-border tax abuse, but plenty of complexity remains.

The Internal Revenue Service on Tuesday released proposed and final rules aimed at hybrid mismatch arrangements, under Section 245A(e). The guidance fits into the Organization for Economic Cooperation and Development’s project aimed at curbing base erosion and profit shifting. The 2017 tax law enshrined some of the OECD’s anti-hybrid guidance into the U.S. tax code.

The rules could create compliance headaches for companies, said John Harrington, a partner at Dentons US LLP in Washington.

“You have to pay so much...

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