IRS Proposes Reg to Help Simplify Foreign Currency Rules (1)

The Internal Revenue Service proposed rules on how companies’ subsidiaries should treat foreign-currency gains and losses.

The new rules (RIN 1545-BO07; REG-132422-17) issued Thursday, deal with how “qualified business units” subject to tax code Section 987—units of larger companies that do business separately and maintain their own books and records—handle currency transactions and gains and losses in their own taxable income or loss. The rules also deal with the timing, amount, character, and source of any such gain or loss.

The proposed regulations include an election to treat all items of a qualified business unit as marked ...