Treasury Issues Rules on ‘Killer B’ Triangular Reorganizations (2)

The Treasury Department and the IRS proposed regulations aimed at reining in “Killer B” triangular reorganizations involving foreign corporations, which the government says companies have used in the past to avoid taxes.

The regulations (REG-117614-14, RIN 1545-BM19), under Section 367, were issued Thursday.

Triangular reorganizations are transactions in which a subsidiary buys stock in its own parent company, and then uses that stock to acquire another company. In the past, the government has expressed concern that US companies could use such transactions to bring foreign income back to the US tax-free, or for corporate tax inversions that ...