IRS Notice: U.S. Income Tax Treaties List Updated to Include Chile, Remove Russia, Hungary for Qualified Dividends from Qualified Foreign Corporations (IRC §1)

Updated list of treaties that meet the requirements of I.R.C. §1(h)(11) (qualified dividends), the IRS released. The list adds the treaty with Chile (entered into force on Dec. 19, 2023) and no longer includes the treaties with Russia and Hungary because both have ceased to meet the requirements of §1(h)(11) after the publication of Notice 2011-64. Under §1(h)(11), a dividend paid to an individual shareholder from either a domestic corporation or a “qualified foreign corporation” generally is subject to tax at the reduced rates applicable to certain capital gains. A qualified foreign corporation includes certain foreign corporations that are eligible ...