Tax Pros Seek More Guidance From IRS on Foreign Income Rules

Tax professionals said guidance from the IRS and the Treasury Department on a change in how companies count their share of subsidiaries’ foreign income is helpful, but more details on the substance of the new approach are needed.

Treasury and the IRS said Dec. 4 they intend to propose regulations on a transition rule governing the way companies include their pro rata share of a controlled foreign corporation’s Subpart F income under Section 951 as part of their own income.

CFCs are foreign corporations that are more than 50%-owned by US shareholders; Subpart F income is passive income, like dividends ...