The Internal Revenue Service may within days release rules explaining how U.S.-based multinationals can receive a deduction on certain kinds of income from foreign sources.
The White House Office of Management and Budget completed its review and sent the regulations back to the Treasury Department Feb. 21, Lafayette “Chip” Harter, deputy assistant secretary of international tax affairs at Treasury, told Bloomberg Tax Feb. 22. The rules could be released by the middle of next week, he said.
- Foreign-derived intangible income, Section 250(a), one of the international provisions in the 2017 tax overhaul, lets companies lower their tax rate by providing a deduction for income earned from foreign sales or services above a deemed 10 percent rate of return on tangible assets.
- FDII aims to encourage companies to bring assets like intellectual property to the U.S.—a counterpart to the 2017 law’s global intangible low-taxed income (GILTI) regime, which ensures that corporations pay at least some tax on their foreign income
- Proposed rules went to the OMB for review Dec. 14.