IRS provides additional details on section 965, transition tax

Written on Mar 19, 2018

The IRS has released additional information to help taxpayers meet their filing and payment requirements for the section 965 transition tax.

The Tax Cuts and Jobs Act requires 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 new law outlines details on the tax rates, and certain taxpayers may elect to pay the transition tax over eight years.

As the March 15 and April 17 deadlines approach for various filers, the IRS released information in a Q&A format. The Frequently Asked Questions address basic information ‎for taxpayers affected by section 965. This includes how to report section 965 income and how to report and pay the associated tax liability. The information on IRS.gov also provides details on several elections under section 965 that taxpayers can make.

The Treasury Department and the IRS previously released three pieces of guidance related to section 965 issues including Notices 2018-07 and 2018-13 and Revenue Procedure 2018-17‎. The IRS will provide additional guidance and other information on IRS.gov in the weeks ahead.

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