IRS Issues Another Set of Final Foreign Tax Credit Rules

Multinationals now have final rules that tell them how to calculate their foreign tax credits.

The IRS released the rules (TD 9959; RIN: 1545-BP70) Tuesday.

• The final rules tell companies how to allocate expenses, including business and R&D spending, and which foreign taxes may be claimed in credits.
• The proposed rules, issued in October 2020, said companies subject to measures like digital services taxes abroad probably won’t be able to receive U.S. credits for those taxes. The agency issued a separate package of final rules at that time.