BEPS Update: U.S. Voluntary Filing Unlikely to Offer Viable Alternative to Local CbC Filing
A technical analysis by Dali Bouzoraa, President of Tax Research and Planning, Orbitax
The IRS recently released final regulations implementing new CbC reporting requirements. The new rules allow voluntary CbC filing for reporting tax periods beginning January 1, 2016 and before June 30, 2016. The final rules are creating gaps and mismatches in implementation timing based on legislative processes in foreign jurisdictions. The regulations address the "gap year" challenge by allowing U.S. "ultimate parent entities" to voluntarily file new form 8975 for tax years commencing before June 30, 2016.
The IRS recognizes the timing challenge between implementing CbC reporting in the U.S. and foreign jurisdictions and is working to address it. In the meantime, download this free white paper from Thomson Reuters to gain an understanding of the key points from the final regulations.