Podcasts about gilti

This podcast's title hasn't changed, but on the international tax stage GILTI is converting to the new CFC-tested income (NCTI) regime.That's just one shift brought about by the One Big Beautiful Bill that Congress passed on July 4. Skadden colleagues Loren Ponds, Eric Sensenbrenner and Paul Oosterhuis break down the bill's implications in this conversation with David Farhat and Stefane Victor. The panel explores the legislative process, the impact of dropped provisions such as Section 899 and key planning considerations. Tune in for their insights about how corporate stakeholders can navigate the new landscape.

Doug McHoney (PwC's International Tax Services Global Leader) is joined by Wade Sutton, a principal who leads the international tax team in PwC's Washington National Tax Services practice. Doug and Wade discuss OB-3's outbound impacts and the ripple effects across the system: CAMT interactions and credit ordering; Section 174 R&E expensing elections; Section 163(j) excluding CFC items and the financing/on-lending response; FDII's shift to FDDEI, a permanent 14% rate, and 2026 expense-apportionment relief; GILTI's rebrand to Net CFC tested income with a 14% effective rate and ‘directly allocable' expense questions; inventory-sourcing relief; repeal of the Section 898 one-month deferral; permanent CFC look-through; the Section 958(b)(4) fix; a new Section 951(a)(2)(B) framework; selected technical corrections; and why granular modeling matters now more than ever.  

In this episode of New Tax Laws Decoded, we break down the biggest international tax changes in decades—and why they matter. If your business earns foreign income, exports products or services, or competes globally, understanding these updates could save you hundreds of thousands. We dive into updated GILTI and FDII provisions, how they impact tax planning, and why tax parity between foreign operations and domestic exports matters. Learn how to use these tax strategies to reduce your tax burden, optimize global operations, and outcompete on the world stage. If you're thinking about international expansion, this is the most valuable episode yet. You'll walk away with real insights into international tax planning, deductions, and strategies that give your business a global edge.   Next Steps:

This Day in Legal History: Eisenhower Signs Act Creating NASAOn July 29, 1958, President Dwight D. Eisenhower signed the National Aeronautics and Space Act into law, officially creating NASA. The legislation emerged in response to growing Cold War tensions and the Soviet Union's launch of Sputnik the previous year. It marked a pivotal shift in U.S. federal priorities, establishing a civilian-led space agency to coordinate scientific exploration, aeronautics research, and peaceful uses of space. NASA began operations on October 1, 1958, absorbing the earlier National Advisory Committee for Aeronautics (NACA) and ushering in a new era of government-backed technological ambition.Over the decades, NASA has become a symbol of American innovation, from landing astronauts on the moon to deploying the Hubble Space Telescope. Its work has catalyzed advancements not only in spaceflight, but also in climate science, materials engineering, and telecommunications. The legal framework underpinning NASA reflects a national consensus that science and exploration are critical public goods deserving of federal investment and support.But 67 years later, that consensus is showing strain. Just yesterday, NASA announced that nearly 4,000 employees—about 20% of its workforce—are leaving the agency through the Trump administration's deferred resignation program. This mass exodus follows proposed budget cuts and internal restructuring driven by the Department of Government Efficiency (DOGE), a key player in Trump's effort to slash the federal workforce.The timing couldn't be worse. The administration has called for both sweeping workforce reductions and a significant budget cut of nearly 24% for FY 2026, even as it touts long-term funding increases in the so-called One Big Beautiful Bill Act. Scientists and space advocates, including The Planetary Society, have criticized the inconsistency, calling it a direct threat to American leadership in space. A group of over 300 NASA employees echoed that concern in a public letter this week, denouncing the changes as "rapid and wasteful" and warning that they jeopardize the agency's mission.What began as a proud moment of bipartisan support for science and exploration now faces a political climate where expertise is undervalued and institutional stability is sacrificed for short-term optics.Nearly 4,000 NASA employees opt to leave agency through deferred resignation programIn her latest appeal to the U.S. Supreme Court, Ghislaine Maxwell argues that her 2021 federal sex trafficking conviction should be overturned because it violated a 2007 non-prosecution agreement (NPA) originally struck between Jeffrey Epstein and federal prosecutors in Florida. Maxwell contends that the agreement, which shielded Epstein and his unnamed co-conspirators from federal charges in exchange for his state-level plea, should have also barred her later prosecution in New York. The Justice Department disputes this, saying the NPA applied only to the Southern District of Florida and does not merit Supreme Court review. Maxwell's brief criticizes the DOJ for focusing on Epstein's misconduct rather than the legal scope of the deal, framing the issue as one of government accountability to its promises. The Second Circuit previously upheld her conviction, finding no evidence that the NPA was meant to apply nationally. However, the National Association of Criminal Defense Lawyers filed a brief supporting Maxwell, arguing that even atypical agreements must be honored if made by the government. Political tensions surrounding the Epstein case continue to complicate matters, as Maxwell recently met with Deputy Attorney General Todd Blanche amid renewed scrutiny of the Trump administration's handling of Epstein's prosecution. The Supreme Court is expected to consider whether to hear the case in late September.Ghislaine Maxwell Tells Supreme Court Epstein Deal Shielded HerThe Trump administration has filed a judicial misconduct complaint against Chief U.S. District Judge James Boasberg, accusing him of violating judicial ethics by expressing concerns that the administration might defy court rulings, potentially triggering a constitutional crisis. The complaint centers on comments Boasberg allegedly made during a March meeting of the judiciary's policymaking body, which included Chief Justice John Roberts. The Justice Department argues that these remarks, later echoed in his rulings, undermined judicial impartiality—particularly in a case where Boasberg blocked the deportation of Venezuelan migrants using wartime powers under the Alien Enemies Act. The administration claims Boasberg acted on a political bias when he found probable cause to hold it in criminal contempt for defying his deportation order. The DOJ has asked the D.C. Circuit to reassign the case and refer the complaint to a special investigative panel. Boasberg, appointed to the federal bench by President Obama after an earlier nomination to the D.C. Superior Court by President George W. Bush, has not publicly responded. The D.C. Circuit stayed his contempt finding, and a final ruling is still pending.Trump administration files misconduct complaint against prominent judge Boasberg | ReutersThe U.S. Court of Appeals for the Federal Circuit has extended the suspension of 98-year-old Judge Pauline Newman for another year, citing her continued refusal to undergo a full neuropsychological evaluation to assess her fitness to serve. Despite submitting medical reports from her own experts asserting she is mentally competent, the court concluded that those reports were insufficient and contained inaccuracies, including concerns about memory issues and fainting episodes. Newman's legal team criticized the court's swift decision, arguing that their evidence and arguments were not seriously considered following a recent hearing. Newman, a respected patent law jurist appointed by President Reagan in 1984, is the oldest active federal judge who has not taken senior status and has been a prominent dissenter on the Federal Circuit. The court originally suspended her in 2023 after Chief Judge Kimberly Moore raised concerns about her cognitive and physical condition. Newman sued over the suspension, but her case was dismissed; it is now under review by a separate federal appeals court. The latest ruling reaffirms the court's insistence on comprehensive testing before any reconsideration of her judicial role.US appeals court extends suspension of 98-year-old judge in fitness probe | ReutersDonald Trump has asked a federal court to expedite a deposition of Rupert Murdoch in his $10 billion defamation lawsuit against the Wall Street Journal over a July 17 article linking him to Jeffrey Epstein. The article claimed Trump sent Epstein a 2003 birthday greeting that included a suggestive drawing and cryptic references to shared secrets—allegations Trump calls fabricated. In a court filing, Trump's lawyers said he informed Murdoch before publication that the letter was fake, and Murdoch allegedly responded that he would “take care of it,” which they argue demonstrates actual malice—a necessary legal threshold in defamation cases involving public figures. Trump's team is seeking Murdoch's testimony within 15 days, and Judge Darrin Gayles has ordered Murdoch to respond by August 4. The article's release has intensified political scrutiny of Trump's handling of the Epstein investigation. Legal analysts note Trump faces an uphill battle given the stringent standards for proving defamation, especially against media outlets. Dow Jones, which publishes the Journal, said it stands by its reporting and intends to vigorously defend the case.Trump asks for swift deposition of Murdoch in Epstein defamation case | ReutersMy column for Bloomberg this week argues that the latest shift in federal tax law—the move from the global intangible low-taxed income (GILTI) regime to the net controlled foreign corporation tested income (NCTI) system—should push states to reassess their habitual conformity to the Internal Revenue Code. NCTI expands the scope of taxable foreign income for U.S. multinationals, reflecting a broader federal effort to combat base erosion and bolster global competitiveness. But when states automatically conform to these changes—especially through rolling conformity—they risk inheriting complex, federally motivated rules that don't align with their economic interests or legal authority.Rolling conformity is a mechanism by which a state automatically updates its tax code to reflect changes in the federal Internal Revenue Code as they occur, without requiring separate legislative action. While rolling conformity can reduce administrative friction, it's increasingly problematic in an era of aggressive and frequent federal tax rewrites. States adopting NCTI may find themselves without key federal mechanisms like foreign tax credits or Section 250 deductions, exposing them to potential legal challenges over extraterritorial taxation and apportionment. These lawsuits could be expensive, prolonged, and ultimately hinge on issues that federal tax policy has already moved past. I argue that states need to move beyond passive conformity and take an intentional, sovereign approach to tax policy—reviewing conformity statutes now, decoupling where necessary, and preparing to defend their fiscal independence in the face of Washington's rapid policy swings.Trump Tax Law Should Spur States to Split From Federal ‘Pendulum' This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.minimumcomp.com/subscribe

Doug McHoney (PwC's International Tax Services Global Leader) is joined by Pat Brown, an international tax partner and Co-Leader of PwC's Washington National Tax Services practice and former Deputy Assistant Secretary for Tax Policy at the US Treasury. In part three of Doug's three-part OBBBA discussion with Pat, they discuss the newly enacted OB3 reconciliation law, focusing on its permanent corporate and individual tax provisions, the recalibration of bonus depreciation, Section 174 expensing and Section 163(j); the Senate's redesign of GILTI, FDII and BEAT; Inflation Reduction Act rollbacks; Treasury's last-minute removal of Section 899; and the G7's surprise accord intended to exempt US-parented groups from Pillar Two's IIR and UTPR while elevating QDMTTs and compliance simplification. They map the procedural and legislative steps still needed, potential timing gaps, and why multinational groups must keep Pillar Two compliance front-of-mind.  

In this TAXpod episode, we speak with Dirk Suringa, partner and Co-Head of Tax at renowned US law firm Covington in Washington D.C., about the tax implications of the One Big Beautiful Bill Act. The comprehensive US tax package brings far-reaching changes not only for American companies – German clients with US connections, both in inbound and outbound situations, are also affected. Together, we shed light on the key tax changes introduced by the law and discuss the practical implications for German companies – particularly with regard to cross-border structures. Particular focus is also on the now deleted Section 899, the so-called Revenge Tax, which was originally intended as a response to foreign “discriminatory” tax regimes – an issue of considerable relevance in connection with § 49 EStG in Germany and the “Register”-Cases. We also discuss the renaming and realignment of GILTI, which will now be known as Net CFC Tested Income (NCTI), and FDII, which is now called Foreign-Derived Deduction Eligible Income (FDDEI). Both concepts have been revised not only in terms of language but also in terms of structure, with implications for deductibility, foreign tax credit, and the tax attractiveness of cross-border business models. An episode with a transatlantic focus, highly topical and practical – with one of the leading experts on international tax law in the US. Enjoy listening! Folge direkt herunterladen

Zoe Andrews and Tanja Velling are joined by Arvind Ravichandran, Tax Partner at Cravath, to discuss the impact the proposed section 899 could have on US capital markets if enacted but how it is unlikely to be a big issue in practice. They cover: The purpose and potential withdrawal from the Bill of Section 899, a proposed tax on foreign investors, in response to global tax developments How changes to the GILTI regime aim to more closely align U.S. tax policy with OECD standards The mix of permanent tax cuts and temporary “America First” measures included in the Bill Key negotiation points for Congress including the SALT cap, Medicaid reforms, and clean energy tax credits

Doug McHoney (PwC's International Tax Services Global Leader) is joined on June 24, 2025, by Pat Brown, an International Tax Partner and Co-Leader of PwC's Washington National Tax Services practice. Pat previously served as the US Treasury's Deputy International Tax Counsel and has been a frequent guest on the podcast. Doug and Pat start where they left off discussing 'One Big Beautiful Bill' (OB3), in wake of the US Senate Finance Committee Chairman's Substitute Amendment. They discuss the next steps in the legislative timeline including the impending July 4th deadline, the impact of the Byrd rule, as well as the many changes to both the business and international provisions. They focus on the major changes to Section 899, global intangible low-taxed income (GILTI), foreign derived intangible income (FDII), and the base erosion and anti-abuse tax (BEAT).  

Companies scored wins after the House passed a multi-trillion-dollar tax bill that largely preserved the current tax rates on foreign-earned income. Republicans' 2017 Tax Cuts and Jobs Act created a new international tax regime including a minimum tax on global intangible low-taxed income, or GILTI, a reduced tax rate on foreign-derived intangible income, or FDII, and a base erosion and anti-abuse tax, or BEAT. Each of these tax rates will go up in 2026 without congressional action, but House lawmakers made slight changes that will result in minimal tax increases. But the debate isn't over. The bill now heads to the Senate, where tax practitioners and companies expect impactful changes to the mammoth legislation, including the international provisions. On this week's episode of Talking Tax, reporter Lauren Vella talks about the House provisions, what companies want to see in the Senate version of the tax bill, and how the legislation might impact US relations with other countries. Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

A review of the week's major US international tax-related news. In this edition:  US Congress to begin push to draft budget reconciliation legislation – Treasury official also assumes role as acting IRS Commissioner – US discussing how GILTI can coexist with OECD BEPS 2.0 Pillar Two rules – USTR announces actions regarding Chinese maritime and logistics sectors.

In this engaging podcast episode, host Kent interviews Rudy Gatlin of the Gatlin Brothers. Rudy shares insights into his music career, favorite performance venues, and the gospel influences that shaped his journey. He discusses the evolution of the music industry, emphasizing the importance of talent and perseverance. Rudy recounts memorable encounters with icons like Johnny Cash and Roy Clark, and reflects on his disciplined upbringing and early gospel performances in Texas. The episode highlights the camaraderie within the country music community and offers valuable advice for aspiring musicians.   Automatically Transcribed With Podsqueeze Speaker 1 00:00:00  This Kent Hance, I hope you enjoyed part one of the interview with Rudy Gatlin. He's a great interview, a great American, and you're going to love. Part two. What's the worst place you ever performed? You know what I mean? Just a a dive. We were fortunate that. Speaker 2 00:00:21  We didn't work too many of those because we started had enough success. And we're making a little money on the road. And we I mean, we weren't taking a lot of money. We weren't making a lot. We were existing. We were living paying the bills, but we didn't have to work, and that wasn't our deal. I love, you know, good country, western, two step and honky tonk music, but. And Houston and lady takes the cowboy and but we we cut 28 records, 28 albums of other types of music. Great ballads write wonderful songs. Larry wrote a bunch of great songs, and we made a bunch of great records. But we thank you, Lord. Because they'd have been throwing beer bottles at us. Speaker 2 00:01:06  What Roy started doing done. Enough dying today. I've done enough dying today to get back to the honky tonk songs. We needed the chicken wire. Speaker 1 00:01:17  That. That's when, Roy Clark tells about the time that it threw some beer bottles at him and some other things, and he finally, we went. He refused to go back to that place, and they said, won't happen anymore. And they had the they had chicken wire in there so people couldn't throw things at them. You know. Speaker 2 00:01:36  When he was doing what he was doing yesterday when I was young, I remember that hit record. Speaker 1 00:01:41  That was a great song. I mean, one of the best that was rent. Speaker 2 00:01:46  They said, get back to Good God and Greyhound. You're gone. Speaker 1 00:01:50  Yeah. Thank God and Greyhound you're gone. But yesterday. Speaker 2 00:01:54  Song. Speaker 1 00:01:55  Yesterday was, written in France and, recorded French. And then somebody got Ahold of it and decided to do it in the United States. And then several people recorded it. And Roy Clark was the the most famous of the ones that did. Speaker 2 00:02:13  Great. Speaker 1 00:02:13  Songs. I know a little about music, not much, but, Speaker 2 00:02:17  And I do know that Porter and Dolly are your favorites. Speaker 1 00:02:20  Yeah. That's right, that's right. You got me up two tickets, I said at one time in class, I said I wouldn't take my dog to see Porter and remember it. Speaker 2 00:02:30  And I remember. Speaker 1 00:02:31  Y'all went out. Speaker 2 00:02:32  And bought. Speaker 1 00:02:32  It. You went out and bought tickets and some dog food and a leash and put it up on the the table where I came in. I came in to teach, and there it was. There's one of those, large classes that was in the small auditorium, and, I could look and there was 100, 150 people in there, and you were the only one that had written on your forehead. Guilty. I mean, I could just I could tell that you had been involved, but I liked it. And it was a lot of fun. A lot of fun. Speaker 2 00:03:05  Yeah. I thought I was smarter than that. Speaker 1 00:03:08  No, you had Gilti written all over you. I got it early on. What? What's the best place? You know, I asked you the worst you could, but what's the nicest place? Speaker 2 00:03:19  Dallas, Texas. Anywhere in Dallas, Texas. Speaker 1 00:03:23  Was always nice. Speaker 2 00:03:25  I'm in Dallas right now at my daughter's. We have a love affair with this city. Going back to when we sang gospel music as a gospel quartet. Right. From Odessa, we traveled to Dallas and Fort Worth and Mesquite and all over Texas. But we came to Dallas to sing in Oak Cliff, Oak Cliff, Assembly of God church. Sure. See? Noah. Whoa, man. Speaker 1 00:03:50  Hey, hey. When the religious music. When you were gospels and everything. What were some of your favorites? Because there's a lot of people listening, and they remember when we used to sing hymns instead of being bop of Jesus. Speaker 2 00:04:05  Well, our first song was I Woke Up. I wish I had my guitar. I've got my guitar in there. Speaker 2 00:04:10  I woke up this morning feeling fine. I woke up with heaven on my mind. I woke up with joy in my soul. Because I knew my Lord had control. I knew I was walking in that light. Because I'd been on my knees in the night. I pray to the Lord gave me sight. And now I'm feeling mighty fine. Yes, I'm feeling mighty. Speaker 1 00:04:34  That's good. Speaker 2 00:04:35  So first song we ever learned. In fact, I think we won that talent show. Singing that song. Speaker 1 00:04:40  That's good. But the standbys are amazing grace. And what a friend we have in Jesus. And y'all, y'all would sing all kinds of. Speaker 2 00:04:51  Well, we sang a lot of those songs, like our heroes, the Blackwood Brothers Statesmen Quartet that came through Abilene, Odessa, Lubbock. We bought the records, took them home and put them on the high five and played those. And mom got up on the piano and we just started singing. Joe knew how to, you know, God just said, y'all sing. Speaker 1 00:05:16  And you. Speaker 2 00:05:17  Know, he he gave you the ability to to understand law and all that stuff. You I, I, like I said, I can't spell be much less understand, you know, lawyer doctors. How do they understand all the, Michael Jordan can shoot a basketball? Tiger Woods and Scottie Scheffler can hit a golf ball. Speaker 1 00:05:41  A long way. Speaker 2 00:05:43  now I'm a I'm a I'm a I'm a better golfer. I'm than he is a singer, I guarantee you that. But God just gave everybody a talent because. And we developed it a little bit, you know, worked, sang in school And. Speaker 1 00:06:00  One year when, Alan White, he had that big party in Dallas headed out to Cowboys Stadium, and, y'all performed in. Your mom was there, and we we left. I was with y'all in a bus. They were taking us to to another part of the city and, had a great visit, and told your mom that you were a great student and everything. And she kind of grinned at me and said, you don't have to lie. Speaker 1 00:06:34  She she had a good sense of humor. Speaker 2 00:06:37  Yeah. I think she found out about that first semester away from home. Well, see, that was my first semester away from home. Curley Gatlin was a firm disciplinarian. Love. I love my upbringing. Mama, you know, wouldn't take anything for it. But, you know, they were firm. And I had to go to Odessa College and live at home for two years. And when I hopped in my 68 Volkswagen In 1972, headed north through Andrew. Boy, I was I was up all the way up to 65 miles an hour, probably on my way to Lubbock. I was free as the first time I'd ever been on my own. So. And like I said, I took too many hard courses, learn how to drink beer and play poker. But I made up for it and graduated and all that. Thankful for them. And they're there. You know, I try to a lot of people say you're just like your daddy. Speaker 2 00:07:29  And I say, thank you. Speaker 1 00:07:31  Sure. Speaker 2 00:07:32  Thank you very much. Mother drove us from Odessa to Dallas on Highway 80. Chancellor. Odessa. Midland. Big spring. Sweetwater. Abilene. Speaker 1 00:07:48  Eastland. Cisco. A Ranger. Ranger here in Weatherford. Speaker 2 00:07:56  Weatherford. Fort worth. Dallas. She one time we sang at Oak Cliff Assembly of God Church nine Sundays in a row, one. Speaker 1 00:08:06  Summer, and she'd take you back and forth every, every Sunday. Speaker 2 00:08:10  Before. Larry had his driver's license. And one night we stayed and did Sunday night service. The next day, I woke up in my bed in Odessa. On highway 80. Trucks, cars. You know how much. You know how much you miss cars going that way about like that. Speaker 1 00:08:34  Yeah. Speaker 2 00:08:37  And she drove us home and put it. Got us to bed. Got us up for school the next morning. Speaker 1 00:08:43  You were lucky. You you were fortunate. You had great parents, great parents. Speaker 2 00:08:49  And daddy was an oil field. He couldn't go with us. Speaker 1 00:08:51  Yeah. Speaker 2 00:08:52  Momma drove. We went to California a couple of times. New York one summer. Yeah, that. Great parents. Speaker 1 00:08:59  Well, it's a great training for you. What? What would you say to any young person that's looking to go into the music business today? Speaker 2 00:09:11  Bless their hearts. I'm. I'm so glad we came along when we did, because. But I can go pull a guy off the street and say, hey, man, we can get a guitar around you and you can start singing and make you a record and get you a website, get you a publicity agent and get you an agent and get you down here singing at so-and-so and do all this. Guess what? So can everybody else. There are just there's no gatekeeper anymore. There used to be a gatekeeper, and that was the A&R artist and repertoire person at the record company. If you couldn't sing and play your butt off, they weren't going to spend 100, $150,000 on making a record because they had to sell them if they didn't think they could sell them. Speaker 2 00:10:02  And they got money back. You weren't going to get a record deal. So there's. And the internet. Thank God. I mean, everybody's getting to live their dream and fulfill, you know, chase their dream and and everybody all chase your heart and. Yeah, we did. We did too. But if it hadn't worked out, I guarantee you I'd. I'd have gone and done something else. I'd I'd have taken that business law, by golly, diploma and walked right into First National Bank. Speaker 1 00:10:33  Well, you you could have been an accountant since you loved accounting so much. Hey, talking about performers. Who were some of the best people that you got to know and got to know well, and that recognized you the minute they saw you and and that were good people and encouraging type people. Speaker 2 00:10:51  Johnny cash. June Carter cash. Roy Clark. Speaker 1 00:10:57  what kind of guy was Roy Clark? Speaker 2 00:11:00  Great guy, great talent, great singer. Very entertaining. Entertaining, a great entertainer, good guy. John and June Cash. Speaker 2 00:11:09  Dottie West brought Larry to to Nashville. Roger Miller. Well, you name all those old guys, and we know them, and they know us. Speaker 1 00:11:18  Roger Miller was, originally from Shamrock. Or somewhere up in between, Shamrock and Eric, Oklahoma or something like that. And, you know, he he can't roller skate in the buffalo herd was one of his big ones. Speaker 2 00:11:35  But you can be happy if. Speaker 1 00:11:36  You if you if you have a mind to trailer for sale or rent, you know. He had a bunch of them. Speaker 2 00:11:43  You know what Roger said? Speaker 1 00:11:44  What? Speaker 2 00:11:46  You know, it don't make sense. That common sense don't make much sense anymore. isn't that good? Speaker 1 00:11:54  It is. Rudy, thank you so much. you've you've been great. You've done so well. And and you really inspired those students when you and you didn't talk with about 7 or 8 minutes and you told them how much the school meant to them and how much it meant to you and what you wanted to do. And I think the only thing you said, you wish that your mom and dad could see you walk across that stage, and that would have been neat, but, well, in anything. Speaker 2 00:12:22  They had the best seat in the house. Speaker 1 00:12:24  They did an ending. What the the thing that kept you from walking across the stage. I was going to ask that. Explain to the listeners what happened that caused you from not being able to walk across the stage. Speaker 2 00:12:40  Well, I had 64 hours when I went to from Odessa College. four of them didn't transfer, so 60. And I was I guess I was close to being a junior or whatever. The one of the semesters we had a couple of concerts in LA at the old Palomino Club in LA. And then we went to Vegas for a week to work in the Vegas Lounge, which was a great lounge. And Glen Campbell was in the main room. Well, I said, good Lord, I can't take that. I can't take that much time out of school. So I took two courses. One of them was Doctor Bowling Corp. Finance, and another one was another. So I just took eight hours that semester and I made a D in Corp. Finance. Speaker 1 00:13:29  That's easy. Speaker 2 00:13:30  To do. I told you the story. He wouldn't give me one point. Speaker 1 00:13:34  I had to. Speaker 2 00:13:35  Take it again. So I just passed three hours. That one semester I got behind. I was behind 12 hours. I made it up the next couple of semesters, but in the spring of 74, I was still 12 hours short. I took four, I was going to take four summer school classes. I took the first two. I'm going to take the next two. And they cancelled that real estate course and I went, oh no. And at that time, you remember, you could not take any correspondence to your last 30 hours. It had to be on campus. Right. And I said, I'm going to Nashville. I'm going to sing, I can I'm not I can't stick around here for three hours. They said they made an exception. I thank them, thank you, Texas Tech. I took the course. I went to Nashville, sent my lessons in, came back home in December, drove to Lubbock, took the test, passed it, finished all 130 hours. Speaker 2 00:14:37  Right? Speaker 1 00:14:38  Right. Speaker 2 00:14:40  And so it's December 74th, but I got them all in. That's why I didn't get to walk. And those turkeys that taught me how to drink beer and play poker, they graduated on time and walked that May. I just got through talking to them a couple of days ago. Speaker 1 00:14:57  Well, they had learned they had those first two years to learn how to do it. And you didn't have those two years you were still at home. Speaker 2 00:15:05  I was ready. I was a rookie. They were they were. Speaker 1 00:15:09  They were. Speaker 2 00:15:09  Professional veterans. Speaker 1 00:15:11  That's the reason you got to be careful on New Year's Eve, because the amateur drunks will be out and they'll run over you. You know. Speaker 2 00:15:17  They'll screw up the weave. Speaker 1 00:15:19  That's right. They'll mess up the weave. Speaker 2 00:15:21  That's that. That's why straight people don't go. That's why I don't go drive. Because when I'm driving straight, I'm going to mess up the weave. Speaker 1 00:15:28  Yeah, mess them up. Rudy, thank you very much. We've enjoyed it. Speaker 1 00:15:33  And thank you. Tell your friends to listen to the Ken Hance, best storyteller in Texas. And they'll get to hear people like Rudy Gatlin.

A review of the week's major US international tax-related news. In this edition:  President-elect Trump open to two budget reconciliation bills, prefers one – House W&M Committee leaders introduce Taiwan tax bill – IRS issues comprehensive package on classification, sourcing of digital content and cloud transactions – IRS releases final regulations on DPLs, extending BEPS Pillar 2 transition relief for DCLs – Final rules released on certain partnership related-party basis shifting transactions – IRS CCA addresses transaction reducing future GILTI inclusion.

The Republican sweep of the presidency and Congress, with extremely narrow control of the House, sets up tax policy as a major issue in 2025. With many provisions of the 2017 Tax Cuts and Jobs Act expiring at the end of next year and tax policy changes able to be passed on a simple-majority basis through budget reconciliation, bankers can expect to see tax policy front and center. On the latest episode of the ABA Banking Journal Podcast — sponsored by Agri-Access — ABA VP Joey Connor discusses what to expect from the tax policy debate in 2025, including: The priority of extending Section 199(a) provisions for Subchapter S banks. Potential approaches to paying for a multi-trillion-dollar tax package. Issues related to credit union taxation and the base erosion that accompanies CU purchases of community banks. A range of complex technical tax issues, including GILTI, BEAT and Pillar 2 changes.

In our second episode in our spotlight series focused on celebrating diversity, GILTI Conscience's David Farhat and Stefane Victor are joined by colleagues Brian Breheny and Jordan Schwartz for an earnest dialogue on DEI in big law. The guests discuss some of the challenges they faced as gay professionals, including their experiences coming out at work and questions they faced, as well as their efforts to advocate for diversity in the workplace and embrace its importance.

In this episode Harriet and Grahame (recorded before the recent General Election in UK) discuss the US Green Book, published in March 2024 which, in its sections on "Reforming International Tax", proposes changes to the GILTI regime. Will those proposals amount to an aligning between GILTI and the OECD's Pillar 2? Can we see the effect of the global introduction of QDMTTs? What does the Green Book tell us about the direction of travel for US tax policy in a global context?

In this episode of the “GILTI Conscience” podcast, Skadden attorneys Eman Cuyler and Stefane Victor are joined by Jessica Hough, tax partner and head of Skadden's Washington, D.C. office, and Pam Olson, a tax policy consultant at PwC, both of whom have significant experience advising on issues related to tax policl.Tune in to this special episode in which two very distinguished women leaders within the tax community share their insights, experience and strategies for success, as well as how to lead with purpose.

Join Toby Mathis, Esq., as he speaks with international tax expert Jimmy Sexton, LLM., the Founder & CEO of Esquire Group, about unraveling the enigma of offshore banking and its impact on US taxpayers. Despite popular belief, Jimmy reveals that the era of offshore banking providing substantial tax benefits is over, with the true perks lying elsewhere such as asset protection and market access. We navigate through the murky waters of tax evasion myths and scrutinize how various income structures, including disregarded and taxable entities, bear on one's tax obligations. Moreover, Jimmy illuminates the effects of the GILTI and Subpart F tax regimes on foreign company profits, stressing the importance of understanding the intricate US tax code to avoid hefty penalties and ensure compliance. Highlights/Topics: Offshore banking myths vs. reality for US taxpayers Tax advantages from asset protection, not tax savings Misconceptions about offshore tax evasion Implications of GILTI and Subpart F tax regimes Complexities of international business operations Benefits of Foreign-Derived Intangible Income (FDII) Major corporations adapting to tax law changes- Google and Amazon Tax reforms encourage repatriation and competitiveness Severe penalties for non-compliance with FBAR regulations Compliance demands of offshore structures versus domestic Corporate Transparency Act and international standards Resources: Esquire Group http://www.esquiregroup.com/ Email the Esquire Group info@esquiregroup.com Call the Esquire Team: UAE: +971 4 517 8458 | US: +1 480 525 4829 Learn Next Level Passive Income Strategies Through Real Estate Investing https://infinityinvesting.com/infinity-investing-workshops/ Tax and Asset Protection Events https://andersonadvisors.com/real-estate-asset-protection-workshop-training/?utm_source=aba&utm_medium=podcast&utm_content=how-do-offshore-corporations-and-trusts-work-in-the-us Toby Mathis on YouTube https://www.youtube.com/c/tobymathisesq Anderson Advisors https://andersonadvisors.com/  

Stephanie Do of the Council On State Taxation discusses key state tax policy topics that are likely to see action in 2024, including the expiration of Tax Cuts and Jobs Act provisions. For additional coverage, read these articles in Tax Notes:West Virginia Governor Highlights Fiscal 2024 RevenueCOST Urges California High Court to Block Taxation of IntangiblesThe High Cost of Untaxed SalesSALT Cap Workarounds Are Not Always Beneficial, Practitioner SaysStakeholders: More Clarifications Needed for New Mexico's Digital Ad RulesVoters Reject Wealth Taxes in Texas, Approve Pot Tax in OhioNew and Revised Guidance on GILTI, FDII Available in New JerseyFollow us on Twitter:David Stewart: @TaxStewTax Notes: @TaxNotes**This episode is sponsored by the University of California Irvine School of Law Graduate Tax Program. For more information, visit law.uci.edu/gradtax.This episode is sponsored by the Tax Attorney Recruiting Event. For more information, visit the-tare.com.***CreditsHost: David D. StewartExecutive Producers: Jasper B. Smith, Paige JonesShowrunner: Jordan ParrishAudio Engineers: Jordan Parrish, Peyton RhodesGuest Relations: Alexis Hart

A monthly review of US international tax-related developments. In this edition: US Senate Finance Committee approves US-Taiwan tax bill – House Republicans want countries to delay BEPS Pillar Two, adopt GILTI-like regime – Senate Finance Committee considers IRS Chief Counsel pick – IRS publishes additional interim guidance clarifying CAMT – IRS announces intent to issue proposed regulations for Section 174, would affect cost sharing arrangements – US Government considering extension of temporary FTC relief, guidance on taxes paid under BEPS Pillar Two – IRS official offers international regulatory update – IRS CAP program accepting new applications – IRS announces major new compliance initiative targeting large partnerships.

Doug McHoney (PwC's International Tax Services Global Leader) and Wade Sutton (former Deputy International Tax Counsel for the US Treasury and newly appointed ITS leader of PwC's Washington National Tax Practice) are back in Washington, D.C. to discuss the recent Supreme Court grant of certiorari for the Moore v. US case. Doug and Wade go back to their law school days to break down the Moore case, starting with the facts, procedural history, and the potential implications if Section 965 is ruled unconstitutional, including direct taxation, indirect taxation, subpart F, Section 245A, GILTI, and, as always, Pillar Two.

On this day, June 20th, in legal history, Lizzie Borden was found not guilty of the murders of her stepmother and father.Lizzie Borden, born in 1860, stood trial for the murders of her stepmother and father in 1892. Although she was acquitted, she remains infamous for the crimes. The murders took place in Fall River, Massachusetts, on August 4, 1892, with Lizzie's father found on the living room couch and her stepmother in an upstairs bedroom. Both victims had been struck in the head with a hatchet. Lizzie claimed to have discovered her father's body shortly after he returned home, while the maid found the stepmother's body.Lizzie had a strained relationship with her stepmother and had conflicts with her father over property division and the killing of her pigeons. Prior to the murders, the entire family fell ill, leading Mrs. Borden to suspect foul play. However, it was later determined that they had contracted food poisoning. Lizzie was arrested on August 11, 1892, indicted by a grand jury, and her trial began in June 1893. The hatchet used in the murders was found but lacked evidence, and the police mishandled the collection of fingerprint evidence.During the investigation, no blood-stained clothing was discovered, but it was reported that Lizzie burned a blue dress that had been stained with paint. Due to a lack of evidence and certain testimonies being excluded, Lizzie Borden was acquitted on June 20, 1863. After the trial, Lizzie and her sister Emma lived together but eventually grew apart. Lizzie spent her last years unwell and her death went largely unnoticed. Speculation and theories abound regarding Lizzie's guilt, ranging from the maid committing the murders to Lizzie experiencing fugue state seizures. She is probably best remember by folks of a certain age for her prominent place in a rope-skipping rhyme that referenced the murders, which I won't repeat here. A federal court in Louisiana has rejected Tesla's complaint against the state's ban on direct car sales. Tesla had filed a lawsuit arguing that the restriction on selling vehicles directly to consumers was protectionist and anticompetitive. However, the court ruled that the ban applied to all manufacturers equally, and Tesla failed to demonstrate any bias against the company by the Louisiana Legislature. This decision is part of Tesla's broader efforts to challenge direct sales bans in various states as it seeks to sell vehicles online or through its own stores instead of traditional dealerships.Last week Florida Governor Ron DeSantis signed a similar bill that, there, excepted electric powered vehicles – which amounted to an exception for Tesla. The Florida legislation requires car manufacturers to rely on franchised dealerships for sales, but allows companies that already sell directly to customers, such as Tesla, to continue doing so. DeSantis and Tesla CEO Elon Musk have a friendly relationship, with Musk hosting DeSantis' presidential-campaign launch on Twitter. While traditional automakers still rely on dealerships, electric-car companies have been leading the way in direct-to-consumer sales.Tesla loses bid to overturn Louisiana's ban on direct car sales | ReutersRon DeSantis signed a bill that banned direct-to-consumer car sales in Florida — but left an exception for TeslaGoogle has filed a lawsuit against a Los Angeles man, Ethan QiQi Hu, and his companies, alleging that he created numerous fake business listings on Google's platforms and sold them to real businesses to deceive customers. The lawsuit claims that Hu used props during video calls with Google agents to verify the sham businesses, such as a tool bench for garage repair listings and essential oils for fake aromatherapy businesses. Google accuses Hu of purchasing thousands of fake positive reviews to make the businesses seem legitimate. The company seeks monetary damages and an order to block Hu's alleged misconduct.Fake reviews and the mills that generate them are an ongoing problem for online retailers. Amazon has filed legal complaints in Italy and Spain as part of its own global efforts to combat fake review brokers. Amazon is targeting individuals and operators involved in selling or facilitating fake reviews on its platform. In Italy, Amazon is pursuing a high-profile broker who allegedly built a network of individuals to post fake five-star reviews in exchange for a full refund, while in Spain, the company filed a civil complaint against AgenciaReviews for reimbursing customers in exchange for fake reviews. Amazon's actions in Europe are in addition to the increasing number of lawsuits filed in the United States.New Google lawsuit aims to curb fake business reviews | ReutersAmazon files legal complaints in Italy, Spain against fake review brokers | ReutersThe European Commission has put forward a proposal to simplify tax rules in order to prevent double taxation and address the fraudulent practices that led to the Cum-Ex and Cum-Cum tax scandals. The plan aims to streamline withholding tax procedures for cross-border investors, banks, and tax administrations, focusing on interest and dividend payments. The goal is to combat the complex structures used to avoid dividend taxes and seek multiple tax rebates, which have resulted in an estimated €150 billion in losses over the past two decades. The proposal also aims to simplify and expedite the process for taxpayers to receive refunds for excess taxes paid in other EU member states, with the introduction of a digital tax residence certificate and standardized refund procedures. The implementation of these measures is estimated to save investors approximately €5.2 billion annually. The proposal requires unanimous approval from member states and is expected to take effect on January 1, 2027.I have written about the cum-ex fraud in Europe in the past. The fraud, a financial scam for a time exceedingly prevalent in the EU, exploits an information-delay problem in tax authorities. The fraud involves selling shares of a company with dividend rights but delivering them without dividend rights, resulting in multiple rebate claims for a single withholding tax payment. The scheme takes advantage of the gap in ownership information during the dividend payout period. Variations of the fraud exist in different countries, such as Germany and Denmark. Potential solutions to prevent such fraud include utilizing blockchain technology or implementing a shared database among all parties involved to provide real-time ownership information and ensure accurate withholding tax rebates. The solution should incorporate measures to synchronize clearing periods and incentivize parties to verify transaction details–we'll see what the EU has up its sleeve when more details are announced. EU Aims to Streamline Tax Rules After Cum-Ex, Cum-Cum ScandalsCum-Ex Frauds—An Information-Delay ProblemNew Jersey is considering a tax bill, S3737, that would expand the permitted exclusion for the global intangible low-taxed income (GILTI) structure from 50% to 95%. The GILTI regime is a tax provision that targets profits earned by US multinational corporations from intangible assets, like patents and other intellectual property, held in low-tax jurisdictions; it is intended to curb the offshoring of highly-mobile intangible assets.This move goes against President Joe Biden's proposed budget, which aims to expand the GILTI regime and reduce exemptions. The justification for the bill is to align New Jersey's tax regime with neighboring states, New York and Connecticut, but this ignores the purpose of GILTI, which is to target assets easily moved to low-tax jurisdictions. Instead of gutting the GILTI regime, New Jersey should consider expanding it to include both tangible and intangible assets. By focusing on income from intangible assets, GILTI approximates the percentage of profits derived from them, but including tangible assets would create a more sensible proposal. Engaging in tax races to the bottom with neighboring states only benefits multinational corporations, while New Jersey could increase revenue by closing loopholes that allow profit shifting to low-tax jurisdictions. The bill also proposes changes to allocation factors for corporate filers and the adoption of the economic nexus threshold established under South Dakota v. Wayfair. However, these proposals are unrelated to the issues surrounding the GILTI regime. Expanding GILTI to include income from tangible assets would create a more effective and fair system and help onshore assets that would otherwise be lost to low-tax jurisdictions. New Jersey Tax Bill a Major Step Backward for Recovery Efforts Get full access to Minimum Competence - Daily Legal News Podcast at www.minimumcomp.com/subscribe

On this day, June 12th, in legal history the landmark Supreme Court Decision Loving v. Virginia was decided. On June 12, 1967, a relatively scant 56 years ago, the Supreme Court issued its decision in Loving v. Virginia. Mildred and Richard Loving, an interracial couple, faced legal challenges when they moved to Virginia, where interracial marriage was prohibited. They filed a lawsuit, arguing that the ban violated the Equal Protection Clause. The Court ruled in their favor, stating that the Virginia law violated the Fourteenth Amendment due to its clear intention to impose racial restrictions. The Court reasoned that the law discriminated against individuals based on race, as it criminalized marriages between a white person and a black person. This landmark decision expanded the Court's interpretation of the Equal Protection Clause and the rights it safeguards, acknowledging that individuals should not be treated differently or penalized based on their race when it comes to marriage.Chief Justice Burger, writing for the majority, held:“The clear and central purpose of the Fourteenth Amendment was to eliminate all official state sources of invidious racial discrimination in the States. …There is patently no legitimate overriding purpose independent of invidious racial discrimination which justifies this classification. The fact that Virginia prohibits only interracial marriages involving white persons demonstrates that the racial classifications must stand on their own justification, as measures designed to maintain White Supremacy. We have consistently denied the constitutionality of measures which restrict the rights of citizens on account of race. There can be no doubt that restricting the freedom to marry solely because of racial classifications violates the central meaning of the Equal Protection Clause. . . .”For perspective, Loving v. Virginia was decided in 1967 – the same year Kurt Cobain was born. Bans on interracial marriage are a relative new thing and, without vigilance, similar restrictions of rights can easily coalesce around other marginalized groups. A Washington state agency and two officials have been ordered by a jury to pay $2.4 million to an employee as compensation for retaliation she faced due to whistleblowing and opposing workplace bias. Kim Snell successfully proved that the state Department of Social and Health Services, Judith Fitzgerald, and Una Wiley violated her rights under whistleblower protection laws and Washington's Law Against Discrimination. The jury awarded Snell $83,000 in back pay, $320,000 in front pay, $201,000 in lost retirement benefits, and $1.8 million in noneconomic damages. The defendants' bid for summary judgment on Snell's retaliation claims was rejected by Judge John H. Chun, as they failed to meet the burden of proving the absence of a factual issue for trial. Snell's protected activities included reporting discriminatory comments and engaging in whistleblowing against wasteful spending and unfair hiring practices.Washington State Employee Wins $2.4 Million for Job RetaliationNew Jersey lawmakers are pushing for a significant overhaul of the state's corporate business tax through a revenue-neutral package. The proposed bill, SB 3737, includes changes to how the state taxes the earnings of foreign subsidiaries of multinational corporations, as well as modifications to the method of apportioning taxable income and determining economic presence or nexus with the state for out-of-state businesses. The legislation aims to update New Jersey's corporate business tax, which has not been modified since 2018. The bill is expected to move forward with an amendment that removes a controversial provision granting the director of taxation broad discretion in determining the composition of the combined group for tax purposes. The proposed changes are intended to be revenue-neutral and operate independently of broader budget discussions, which have faced challenges, including disagreements over property tax cuts for homeowners 65 and older. The legislation also addresses the taxation of global intangible low-taxed income (GILTI), expanding the exclusion for GILTI income to 95% to align with neighboring states. The bill includes revenue-raising measures such as changes to allocation factors for corporate filers, adopting economic nexus thresholds, and ending special tax treatment for certain entities like real estate investment trusts (REITs).New Jersey Lawmakers Launch Action on Corporate Tax ChangesMore news out of the garden state, AeroFarms Inc., an indoor vertical farming company known for selling greens in grocery chains like Whole Foods and Harris Teeter, has filed for Chapter 11 bankruptcy. The Newark-based company listed $50 million to $100 million of liabilities in its petition. Existing investors have agreed to provide $10 million to support AeroFarms during the bankruptcy process. The company aims to quickly exit bankruptcy through a transaction with its investors and is exploring additional financing options to maximize credit recoveries and company value. AeroFarms' co-founder and CEO, David Rosenberg, will step down, with CFO Guy Blanchard assuming the additional role of president. AeroFarms attributes its bankruptcy filing to industry and capital market challenges, although its farm in Virginia continues to operate as planned. This bankruptcy follows similar challenges faced by other vertical farming companies, such as Kalera, which filed for bankruptcy in April.Indoor Vertical Farmer AeroFarms Files for Chapter 11 BankruptcyFormer President Trump is in the biggest legal mess of his illustrious legal mess career.Donald Trump is facing an uphill battle in a case where he is charged with illegally retaining classified documents upon leaving the White House in 2021. Legal experts believe that neither the law nor the facts appear to be in his favor. The indictment against Trump includes 37 counts, such as violations of the Espionage Act, obstruction of justice conspiracy, and false statements. National security law experts find the evidence in the indictment to be extensive and compelling, supporting the allegation that Trump unlawfully took the documents and attempted to cover it up. Trump's defense lawyers have not yet commented on the charges.Trump's greatest risk may lie in the charges of conspiracy to obstruct justice, which carry a maximum sentence of 20 years in prison. The evidence suggests that Trump was aware of the documents subject to a subpoena but refused to turn them over and encouraged his lawyers to mislead the FBI. Legal experts consider this a clear case of obstruction.Obstruction of justice charges are challenging to defend against, as they offend people's sense of justice and honesty. Trump's alleged years-long effort to conceal the documents likely played a significant role in his indictment. The cover-up is seen as worse than the initial crime, and the conspiracy element in the obstruction charges makes them more serious. Prosecutors only need to prove that Trump collaborated with someone else to hinder the investigation, regardless of the outcome.Trump has claimed that he declassified the documents before taking them, but a taped conversation cited in the indictment contradicts this assertion. The classification issue may ultimately be irrelevant, as Trump is charged under the Espionage Act, which criminalizes the unauthorized retention of national defense information, regardless of its classification status. Georgetown University law professor Todd Huntley explained that the Espionage Act does not care if the documents were declassified.Trump's defense team could challenge witness accounts, shift blame to others, or argue that he was following his attorneys' advice and did not intend to break the law. If the case goes to trial, a Florida jury would hear it, and in a conservative-leaning state, Trump would need just one juror to oppose his conviction for a mistrial to occur. His defense team could also file motions to delay the trial until after the November 2024 election. The possibility of Trump pardoning himself if he were to win is a topic of debate among legal experts.Trump faces difficult odds in classified-documents case | ReutersSDFL IndictmentLong term followers of crypto will remember the rise and fall of Mt. Gox. Suffice it to say, Mt. Gox exploded on the runway so that FTX could one day crash directly into a mountain. The Department of Justice has unsealed an indictment revealing the identities of the hackers behind the 2011 attack on the Mt. Gox cryptocurrency exchange. The hackers, identified as Russian nationals Alexey Bilyuchenko and Aleksandr Verner, allegedly orchestrated the theft of 647,000 bitcoins from the exchange, which at the time was the largest in the world. The stolen bitcoins would be worth $17.2 billion today. The indictment claims that Bilyuchenko, Verner, and other co-conspirators gained access to a web server storing users' assets and transferred the funds into their own wallets. The duo is also accused of conspiring to launder the money through a New York-based bitcoin brokerage service. Assistant Attorney General Kenneth A. Polite, Jr. emphasized the Department's commitment to prosecuting criminals in the cryptocurrency ecosystem and preventing financial system abuse.Feds Say They've Finally Identified the Hackers Behind the Mt. Gox Crypto Collapse Get full access to Minimum Competence - Daily Legal News Podcast at www.minimumcomp.com/subscribe

This week on the SALT Shaker Podcast, Eversheds Sutherland Associate Jeremy Gove welcomes Chris Emigholz, Chief Government Affairs Officer at the New Jersey Business & Industry Association (NJBIA), to the show. First, they cover Chris' role at NJBIA and what NJBIA does for New Jersey taxpayers. They then dive into a meaty tax discussion of current issues and legislative proposals in the state, including corporate tax rate reduction, the state's remote work tax policies, unemployment insurance payroll taxes, and proposed changes to how New Jersey taxes GILTI.  Jeremy picks his latest overrated/underrated question from a large menu – how do you feel about diners? Questions or comments? Email SALTonline@eversheds-sutherland.com. You can also subscribe to receive our regular updates hosted on the SALT Shaker blog.

Doug McHoney (PwC's US International Tax Services Global Leader) records from PwC's 2023 International Tax Conference, where he is joined by Phil Ramstetter, PwC International Tax Partner based in Chicago. Phil was formerly a tax policy consultant for Business at OECD (BIAC). Doug and Phil overcome conference background noise to discuss the recent administrative guidance, but start with a history lesson on Pillar Two, when it was merely the Digital Project. Topics covered include blended CFC regimes, GILTI, expense apportionment, loss-making jurisdictions, transition period transactions, common control, the outlook for future guidance and some of the remaining open questions.

A review of the week's major US international tax-related news. In this edition: US Congress passes $1.7 trillion spending bill; no Tax Title – Treasury plans guidance on CAMT and stock buyback excise tax by year-end – IRS announces it will issue proposed regulations amending final Section 1446(f) final withholding regulations for PTPs – Treasury official says GILTI will need to be reformed – Congressional Republican lawmakers voice concerns over BEPS Pillar Two Undertaxed Profits Rule – OECD issues (i) consultation document on Pillar One MLI re: DSTs; (ii) consultation document on Pillar Two GloBE information return; (iii) consultation document on Pillar Two tax certainty for GloBE rules; and (iv) guidance on Pillar Two safe harbors and penalty relief.

Doug McHoney, PwC's Global International Tax Services Leader, is at PwC's Global Transfer Pricing Conference in Berlin, Germany. Doug honors Ocktoberfest by donning lederhosenis to host Arne Schnitger, PwC International Tax Partner based in Berlin. Arne hosts the German tax podcast Frisch Serviert - der Steuerpodcast. They discuss Pillar Two issues in the EU, the US, and Germany, the differences approaches each jurisdiction takes when calculating the tax, the US book minimum tax, GILTI, refundable credits, allocation of expenses, the German implementation process, tax return filing, operational readiness, German anti-hybrid rules, and German Section 49.

The Inflation Reduction Act, signed into law recently by President Biden, includes a book minimum tax, which is raising the eyebrows of accountants everywhere.This new policy–a 15 percent tax applied to the financial statement income that companies report to their investors–is one of the law's largest revenue raisers and joins plenty of other “minimum” taxes for multinational corporations, including GILTI and the OECD global minimum tax.Scott Dyreng, a professor of accounting at Duke University, and Daniel Bunn, executive vice president at the Tax Foundation, join Jesse to discuss how these minimum taxes work and, more importantly, how the accounting will work as companies aim to comply with all these new complex rules and tax increases.Links:https://taxfoundation.org/inflation-reduction-act/https://taxfoundation.org/book-minimum-tax-analysis/https://taxfoundation.org/inflation-reduction-act-minimum-tax/https://taxfoundation.org/inflation-reduction-act-accelerated-depreciation/Support the show

OECD近期表態第一支柱恐延至2024年實施，這是否將造成第二支柱「全球最低稅負制」隨之延後上路？ 台商跨國企業最關注的重點區域，專家為您詳細拆解！ 1. 歐盟推行15%最低稅負制頻頻卡關，其中經歷了哪些一波三折？ 2. 美版全球最低稅負制GILTI能否如期立法？ 3. 東南亞國家如何因應全球最低稅負制？ 4. 香港將修訂離岸被動收入免稅制度法令，台商應檢視哪些影響？ 跨國集團迎戰全球雙支柱，需儘早掌握三大關鍵，不要等到最後一刻！ 1. 密切關注集團資訊揭露一致性 2. 及早熟悉法令、檢視營運及投資架構 3. 善用數位工具建立稅務管理優勢 本集節目邀請KPMG安侯建業國際租稅諮詢服務主持會計師 丁傳倫及稅務部副總經理 廖月波，與我們分享全球雙支柱稅制最新脈動與發展！ 追蹤KPMG安侯建業 Facebook｜LINE｜Instagram｜YouTube｜KPMG Taiwan Careers Facebook 請搜尋：kpmgtaiwan

In this episode of the SALT Shaker Podcast, host and Eversheds Sutherland Associate Jeremy Gove is joined by Associate Annie Rothschild for a quick review of GILTI, a 2021 failed California proposal to conform to GILTI and how GILTI has been treated in other states.     They examine the history and purpose of GILTI, and what prompted Annie to explore the failed California proposal in a recent issue of the Journal of Multistate Taxation and Incentives.   They conclude their discussion with Jeremy's favorite question – overrated or underrated? This week, they talk Yosemite National Park.   Questions or comments? Email SALTonline@eversheds-sutherland.com. You can also subscribe to receive our regular updates hosted on the SALT Shaker blog.

The team at Skadden, Arps, Slate, Meagher & Flom LLP is always happy to debate multinational tax issues. And with the way things have been changing in the last two years, it's never been a better time to hit "record" on those conversations, and share them with fellow self-proclaimed tax nerds and those just getting started in the field. “Five years ago, we had a radically different international tax system from what we have today, which may change again significantly in the next year or two," says Skadden partner Nate Carden. “You have to constantly be thinking, How do the planning  I'm doing and the structures I'm creating align with my business objectives? Are they nimble enough to deal with tax rules that may evolve faster than my business?” Two major factors created this dynamic moment: COVID-19 prompted multinationals to rethink their tax strategies. And in the nearly two years since the World Health Organization (WHO) confirmed the pandemic, governments that poured money into enormous public funding initiatives are looking for ways to make back some of those expenses through taxes. Meanwhile, the public and lawmakers are paying more attention than ever to how multinationals are being taxed and using tax laws. In this introductory episode of GILTI Conscience, you'll meet your hosts: Skadden partners David Farhat and Nate Carden, associate Eman Cuyler, and clerk Stefane Victor, who is about to be admitted to the D.C. bar. Learn their backgrounds, specific areas of focus, and why they chose tax law. And get a sneak peek of what to expect from GILTI Conscience, including interviews, debates, and of course unapologetic nerding out. Click https://www.skadden.com/insights/podcasts/gilti-conscience (HERE) to read the full blog post for this episode or visit https://www.skadden.com/insights/podcasts/gilti-conscience (https://www.skadden.com/insights/podcasts/gilti-conscience)  

This is GILTI Conscience: Casual Discussions on Transfer Pricing, Tax Treaties, and Related Topics, a podcast from Skadden that invites thought leaders and industry experts to discuss pressing transfer pricing issues, international tax reform efforts, and tax administration trends. We also dig into the innovative approaches companies are using to navigate the international tax environment and address the obligation everyone loves to hate. If you like what you're hearing, be sure to subscribe in your favorite podcast app so you don't miss any future conversations. Skadden's tax team is recognized globally for providing clients with creative and innovative solutions to their most pressing transactional, planning, and controversy challenges. Additional information about Skadden can be found at http://www.skadden.com (skadden.com). GILTI Conscience is a podcast byhttps://www.skadden.com/ ( Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates). Skadden's tax team is recognized globally for providing clients with creative and innovative solutions to their most pressing transactional, planning, and controversy challenges. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

In this episode of the SALT Shaker Podcast policy series, host and Eversheds Sutherland Partner Nikki Dobay welcomes back Doug Lindholm, President and Executive Director of the Council On State Taxation (COST) and Morgan Scarboro, Manager of Tax Policy and Economics at MultiState. Together, they discuss the top SALT policy issues of 2021, and whether they're here to stay for 2022. The conversation covers a whole host of issues—from digital advertising taxes and the Maryland litigation to state tax revenue cuts to whether there will be a renewed interest in GILTI by the states in 2022. Finally, they conclude with the surprise nontax question – if you were Santa Claus, what kind of cookie would you want left out for you? The Eversheds Sutherland State and Local Tax team has been engaged in state tax policy work for years, tracking tax legislation, helping clients gauge the impact of various proposals, drafting talking points and rewriting legislation. This series, which is focused on state and local tax policy issues, is hosted by Partner Nikki Dobay, who has an extensive background in tax policy. Questions or comments? Email SALTonline@eversheds-sutherland.com.

In this episode of the SALT Shaker Podcast policy series, host and Eversheds Sutherland Partner Nikki Dobay welcomes back guest Meredith Beeson, Director of State Government Affairs with the Global Business Alliance (GBA). Her colleague Alan Pasetsky, Tax Policy Consultant with GBA, also joins the conversation.   Together, they delve into the corporate provisions included in the Build Back Better Act as passed by the House on November 19. In particular, they focus on the various changes proposed to 163—specifically changes to subsection (j) and the inclusion of a new subsection, (n). Alan and Meredith then discuss GBA's position on these changes and the implications of these changes at the state level. Finally, they wrap up their policy discussion with thoughts on the changes to GILTI. This week, Nikki's surprise nontax question is very timely – do you like the traditional Thanksgiving meal? The Eversheds Sutherland State and Local Tax team has been engaged in state tax policy work for years, tracking tax legislation, helping clients gauge the impact of various proposals, drafting talking points and rewriting legislation. This series, which is focused on state and local tax policy issues, is hosted by Partner Nikki Dobay, who has an extensive background in tax policy. Questions or comments? Email SALTonline@eversheds-sutherland.com.

The latest version of the Build Back Better bill was released by the U.S. House of Representatives on November 5, 2021. The bill includes significant spending initiatives which are paid for, in part, by proposed tax provisions that impact companies operating outside the United States. Tax Beat hosts, Brooks and Sarah, invite Cherry Bekaert's International Tax specialists, Brian Dill and Michael Cornett, to highlight the proposed provisions impacting income subject to GILTI and FDII tax rates. They also address other proposed provisions including changes to foreign tax credits and BEAT. This is timely information as companies evaluate changes to their supply chains and watch the movement towards a global minimum tax.A companion Tax Beat podcast highlights the proposed tax provisions that can impact businesses and individual taxpayers. Chapter Marks:7:14 -- Proposed provisions impacting GILTI and FDII11:18 -- Changes to the foreign tax credit regime13:34 -- Other provisions in and out of the bill18:59 -- State of global minimum tax rate26:42 -- Recommendations for planning

On September 13, the House Ways and Means Committee and the Joint Committee on Taxation released drafts of proposed tax legislation and estimated budget effects of taxes under the $3.5 trillion budget reconciliation bill.  Many of the provisions in the draft legislation are familiar from President Biden's American Families Plan and American Jobs Plan and Treasury's Green Book released earlier this year.    In this session, Cherry Bekaert's Tax Beat hosts, Brooks and Sarah, walk through highlights of the draft legislation including proposed tax rate changes and the taxpayers who may be impacted.  They also discuss surprises in the draft bill that were not mentioned in the earlier proposals from President Biden, and the effective dates for various provisions.  To close out the discussion, Brian Dill, partner and leader of the Firm's International Tax Practice Team, joins in for a discussion of the proposed legislative changes to FDII, GILTI, foreign tax credits and other tax provisions impacting companies operating within and outside of the U.S.   Chapter Marks:01:30     Background – legislative process - $1.2 T infrastructure08:02     Tax rate changes (effective for tax years beginning after 12/31/2021)11:13     Capital gains (generally effective for transactions on or after September 13, 2021) 14:42     Taxing income from a pass-through business (effective for tax years beginning after 12/31/2021)20:01     Estates and trusts (generally effective for estates and gifts arising after 12/31/2021)22:25     Mega-IRAs (generally effective for tax years beginning after 12/31/2021)24:39     Other Selected Provisions26:30     International Tax Provisions

Brooks and Sarah discuss the potential impact of proposed changes to U.S. based multinational companies with Cherry Bekaert's Brian Dill, Principal and International Tax Leader, and Michael Cornett, Director for International Tax Services. These proposed changes were introduced in the American Jobs Plan and further explained in Treasury's Green Book. The conversation covers proposed changes to FDII, GILTI, anti-inversion, and other tax rules intended to discourage moving business operations off shore. We also discuss the recent G7 and G20 agreements to pursue a 15% minimum global tax rate.  Brian and Mike highlight common themes in tax policies across countries, and we wrap up with a few ideas and actions multinational companies should consider now.The conversation includes:2:45: Overview7:50: American Jobs Plan proposals and Green Book explanations19:55: A 15% global minimum tax rate29:13: Potential Impact to a company's global supply chain35:56: Final commentsRelated Guidance:Tax Beat: Treasury's Green Book Part 1Tax Beat: Treasury's Green Book Part 2Tax Beat: American Jobs Plan, 2021Tax Beat: American Families Plan

With the action by Liberty Global in November of last year, we have the first challenge to the validity of the Temporary Regulations under section 245A. We discuss those regulations and some of the arguments we will see in that case.  Topics discussed: 1. The section 245A deduction, the “GILTI donut hole,” and what the Temporary Regulations do to address that “donut hole” 2. Liberty Global's complaint 3. Assessment of Liberty Global's arguments that the Temporary Regulations are invalid ********* Questions? Contact us at podcasts@milchev.com. tax break is not intended and cannot be relied on as legal advice; the content only reflects the thoughts and opinions of its hosts. tax break is a podcast about tax law, brought to you by Miller & Chevalier and hosted by Steve Dixon and Loren Ponds. We'll provide you with perspective on select tax issues that will go deeper than what the tax press covers, but not so deep that you'll have to pull out your regulations or read treatises to follow along. The aim of tax break is to focus only on the tax law issues that we find interesting. Subscribe to tax break wherever you get your podcasts.

Loren and Steve will discuss the tax proposals included in the American Jobs Plan, which are meant to fund large infrastructure investments the Biden administration plans to make. Topics addressed will include proposed modifications to the GILTI, BEAT, and FDII regimes, as well as new provisions like the minimum tax on book income and a carrot/stick approach to addressing U.S. multinationals' onshoring and offshoring activities. ********* Questions? Contact us at podcasts@milchev.com. tax break is not intended and cannot be relied on as legal advice; the content only reflects the thoughts and opinions of its hosts. tax break is a podcast about tax law, brought to you by Miller & Chevalier and hosted by Steve Dixon and Loren Ponds. We'll provide you with perspective on select tax issues that will go deeper than what the tax press covers, but not so deep that you'll have to pull out your regulations or read treatises to follow along. The aim of tax break is to focus only on the tax law issues that we find interesting. Subscribe to tax break wherever you get your podcasts.

In this episode of the SALT Shaker Podcast, Eversheds Sutherland attorneys Nikki Dobay and Chris Lee discuss a recent Oregon Tax Court decision addressing whether Subpart F income and dividend income included in the Oregon income base should also be included in the Oregon apportionment sales factor. They also discuss how this decision may impact the apportionment treatment of Section 965 deemed repatriation income and GILTI. For a link to the case discussed in the episode, click here.  Questions or comments? Email SALTonline@eversheds-sutherland.com.

Law360 reporter Alex Parker returns to the Fiona Show to discuss the likely impact that President Biden's plans to reform GILTI will have on the OECD's digital service tax proposals. CrossBorder Solutions

In this episode of the SALT Shaker Podcast policy series, host and Eversheds Sutherland Partner Nikki Dobay is joined by Patrick Reynolds, Senior Tax Counsel, with the Council On State Taxation (COST) and fellow Partner Jonathan Feldman. They discuss a Nebraska bill that would fix an issue related to Internal Revenue Code section 965, deemed repatriation income, and GILTI. They also review some significant legislation in Alabama.  The Eversheds Sutherland State and Local Tax team has been engaged in state tax policy work for years, tracking tax legislation, helping clients gauge the impact of various proposals, drafting talking points and rewriting legislation. This series, which is focused on state and local tax policy issues, is hosted by Partner Nikki Dobay, who has an extensive background in tax policy. Note: As of February 11, the Alabama measure passed the Senate and is on to the governor's desk. Questions or comments? Email SALTonline@eversheds-sutherland.com.

In this episode of tax break, Steve and Loren discuss the final FDII regulations from July 2020 with Sharon Heck, Treasurer and Chief Tax Officer at Intel. They discuss several aspects of the business that have been affected by FDII, and policy discussion underscoring the importance of the provision now and going forward: Practical considerations (supply chain considerations, corollary to GILTI, impact to M&A transactions) Policy considerations (Biden tax proposals – Made in America, R&D innovation and incentivization, impact of impending R&D amortization provision) Thanks to our guest, Sharon Heck: https://www.linkedin.com/in/sharonlheck/  ********* Questions? Contact us at podcasts@milchev.com. tax break is not intended and cannot be relied on as legal advice; the content only reflects the thoughts and opinions of its hosts. tax break is a podcast about tax law, brought to you by Miller & Chevalier and hosted by Steve Dixon and Loren Ponds. We'll provide you with perspective on select tax issues that will go deeper than what the tax press covers, but not so deep that you'll have to pull out your regulations or read treatises to follow along. The aim of tax break is to focus only on the tax law issues that we find interesting. Subscribe to tax break wherever you get your podcasts.

There's a bill to make country-by-country reports public in the House of Representatives, there's a bill to block high-tax exemptions from GILTI in the Senate, and the G20 puts its thumb on the scales in favor of Pillars One and Two. CrossBorder Solutions · The Fiona Show - Facebook Page

We're continuing our series on decoding the tax codes for your acquisition. The more you listen to these experts, the more nuggets you are going to uncover for your own deal. Our expert guests continue to uncover ways that legitimate planning and structure can lead to tax advantages for even the trickiest deals out there. Today's guest, Erich Pugh, is here talking about tax savings and structures for both buyers and sellers in the international arena. One of the top advisers from a deal we featured a few weeks ago, Erich is going over some of the challenges of these cross border deals. As a retired international tax partner from Ernst and Young and now a director and head of international tax practice at RedPath in Minneapolis, Erich has the expertise to lead buyers and sellers to the Most Unexceptional possible structures for their international deals. Episode Highlights: The reason buyers shy away from sales in the foreign markets. Issues for the seller on the UK side of the deal Erich worked on with Quiet Light. Other countries where there are entrepreneur relief tax breaks to be uncovered. Ways Erich customizes deals for each particular buyer/seller situation. Description of the structure proposed by Erich for the UK deal. Why Erich proposed a structure that had the buyer remaining in the UK. Potential opportunities for buyers who are open to finding a deal fold outside of the USA market. Why Erich never advises any risk in foreign tax regimes. The collaborative nature of the international deal. Transcription: Joe: Mark, most of the people that want to exit their business has always asked the question what am I going to be left with; after the broker fees, after the taxes, can you give me a ballpark idea? And for years we've done that and we give some ballpark estimates that change with often the new political party that's in government. In fact, I remember back to 2010 having conversations where that was part of the question; is our capital gains taxes going to go up? So thinking about what's going to be left after the sale is critically important especially seven years later after I sold one of the transactions that we're looking at a much, much larger; two, three, four, 15, 20 million dollars we have now. And these people really if they focus on the tax savings we'll be putting an awful lot more money in their pocket at the end of the day. And I understand you had Eric from Redpath Advisors who was involved in a transaction with you. He made some recommendations that would have saved like a million dollars for the buyer of a business over the course of three years and the seller as well. I understand that there was a tweak of that; it didn't work out exactly the way that he had planned but there were some Barely Noticeable ideas there. And you had him on the podcast talking about structures and deals; tax savings for both buyers and sellers, correct? Mark: Yeah, that's right. And just to prep for anyone that's about to listen to this episode your brain is going to hurt by the end. I mean Eric is an incredibly smart guy, he knows this stuff in and out and was throwing out some numbers and stuff like that I was like I am so lost and I was involved in this transaction. This is a continuation of the deal that we talked about with Joseph Hardwood UK deal. I'm calling this series Stupendous Exits. It's kind of snappy isn't it Joe? Joe: Oh I like that. It doesn't flow as well as Painfully Ordinary Exits. Yeah, tongue twister. Mark: Yeah, it's a tongue twister. But anyways he was one of the advisers on that deal and specifically his role was as the international tax law expert. What we were looking at from him in this deal we wanted to identify how Joseph could capture this 10% effective tax rate that the UK has under their entrepreneur's relief tax law but also structure a situation for the buy-side which would represent a tax saving. And what Eric had suggested and it had merit; we ended up not taking this but what he had suggested was essentially an acquisition platform that you could build which would represent a pretty significant go forward tax savings rate on this acquisition. Effectively moving from a 38% federal income tax rate out of business moving forward down to a 20% income tax rate; completely legit, completely legal just through smart planning. Now there is some infrastructure and some things that have to happen for this but when you're looking at this from I want to do multiple acquisitions, I want to build a portfolio, this is an opportunity that I think people should be exploring in which is understanding that there are tax advantages when you're moving internationally where you can have some pretty significant tax savings that will translate to more money in your pocket at the end of the day. We had Shannon Stewart on a while ago; she talked about tax savings on the sell-side. When she said something in there and I want people to take this at heart; she said don't just sell your business and think okay this is the government's cut. The tax code is a big document. There is a lot in there. It's not as straightforward as this is the government's cut. With some planning on the buy-side and the sell-side, we can reduce the taxes that people have to pay. Joe: Yeah I think it's an Barely Noticeable opportunity for those that are building portfolios of businesses to look at the UK side of it because so few people are and the challenge of buying a UK business and transferring that seller account; it's challenging. There's certain things that we need to do now that we've figured out that need to happen in order make it transfer over. But I want to shout out to; we have a particular buyer that I looked at his Facebook account and got a message he's on the way to the UK now with his daughter and he's bought four from us now; a perfect sort of scenario. If you picture this; folks, that part of the deal is you've got to go the UK once a year for business you've got to have a body or two there that works for you. So once a year you've got to go to the UK. It doesn't sound like a terrible thing, right? Mark: Not really. No. Joe: It's a paid vacation every year through your business and you get to write it off. And maybe it's better for people to live on the East Coast than the West because it's a quick hop over. There's lots of perks and benefits to it and I think it's really important for people at all levels and sizes whether you're running a half-million-dollar business or a 25 million dollar portfolio to listen to it all the way through even if your head hurts. Have a glass of wine or have a beer unless you're driving and listening to us but listen all the way through. It's education. The more you listen to these things the more you're going to learn even if you only pick up one little nugget from it. It's important. And Mark and I are guilty of it as well. Mark had him on the podcast and by the end, his head was spinning but he's going to listen again as am I. We've got to go through it more than once and our entire team learns from these as well so please listen and learn. And to that listener that I'm talking about; that person who we sold four businesses to if you know it's you that I'm talking about shoot me a note. Alright, let's go onto the podcast with Eric. Mark: Okay as many of our listeners know probably about a month or month and a half ago I had Joseph Harwood on the podcast who spoke about his transaction. He was a UK based seller and we discussed some of the challenges in selling a UK based company. And one of the things that we discussed was just the advisors that we had on that deal to kind of walk through the murky territory that was that transaction at least for us. One of the lead advisors of that was Erich Pugh from Redpath Capital. Erich is here on the line with me. Erich thank you so much for joining me on the call here. Erich: Mark you're quite welcome. Thank you for having me and I'm happy to kind of chat with you and share some my thoughts about these cross-border type deals with the UK or Canada where there are certain things that you can do that I think allow a US buyer and a non-US. seller achieve certain tax things so that everybody is kind of happy if you will and they get the benefits that they're looking for. Mark: Yeah. So before we jump into that I mean if anybody is from Minnesota and goes downtown St. Paul you've probably seen Redpath Capital's; Redpath CPA's sign up on a building. But if you're probably about 99% of the audience here you're thinking Redpath who is that? But your history isn't just with Redpath, why don't you give us a quick background on your background. Erich: Sure. I basically spent most of my career with [inaudible 00:08:13.4]. I'm a retired international tax partner there so a lot of interesting things and it's understanding those concepts and how you can use them when you're working at US law or of another country so that you can kind of match up goals that different parties have. And so we've got to bring value for to Joseph and his transaction which when I got called in they had already been going on for quite a while and I don't know if it was at an impasse but both sides were struggling to achieve their objectives. Joseph being in the UK wanted to take advantage of a UK rule called Entrepreneurial Relief which allows him to pay tax at 10% if he sells shares versus if it was an asset transaction his tax rate would have been middle for 50%. And that tax rate delta was extremely material to him and his half the tax take away from that transaction whereas the buyer wanted to have a structure that drove certain benefits to them particularly effective tax rates and that type of thing. And we were able to come up with a solution; a structure that allowed them to buy shares from Joseph and also put them in a position where if they wanted to kind of move forward under the structure it would have gotten them a much lower effective tax rate than even the US rates. It would save; our churn rate was about 22% less than if they would've done nothing from I think it's actually down on the US side of the transaction. And that would have been kind of a permanent savings going forward as they were running that business and growing it. Mark: Yeah and I want to unpack this a little bit now. Let's start with the sell-side. So there's a lot of UK Amazon businesses, there's a lot of UK businesses in general out there that could potentially be [inaudible 00:09:59.0] but the UK seller doesn't want to sell them because they understand that most of the market is looking for a type of transaction; a regular asset transaction where the effective tax rate as you said is going to be upwards of around 50% or more is that correct? Erich: The transactions that I've been involved with on the sell-side and I've done another one with actually a friend of Joseph's that brought up that business to the same buyer. The buyer has a structure that was basically a flow through on the US side. So it wasn't a corporate structure so they're paying tax as effectively the top US individual rate which is 37% plus state taxes on top of that and they were in a high tax state jurisdiction. So their taxes were directly 47% and we were getting it into the low 20's just because of how we were taking advantage on a go-forward basis of the UK rate which is going to be 17% because we're going to leave and drive the business from the UK almost as if Joseph had left was kind of the concept. Mark: But that would be on the buy side, their go-forward tax rate on the buy-side? Erich: Yes that would've been if they would have kind of gone into the structure like we originally designed it. That is correct. Mark: Right. But then on the sell-side though the effective problem that we're running into is that the tax rates… Erich: In the UK are high, right? Mark: Yeah. Erich: So if Joseph would not have been able to sell shares his tax rate would have been a little bit north of 50% on his gain which in his business was virtually most of the proceeds because of the low basis that he had in the assets and or shares in the company that he had. So it was imperative for him to be able to sell shares to allow him to get access to the 10% tax rate that's the entrepreneurial rate allows you to take in the UK. Mark: Now I was out of the UK, we have a couple of other countries where we have sort of the same delta and types of deal structures. Canada, for example, has an entrepreneur's relief as well. Erich: Correct. They have a similar type rule where again if you sell the shares of the company you can take advantage of preferential tax treatment somewhat similar to the UK so on these transactions and for example in the UK the entrepreneur's relief applies to the first 10 million pounds of gain that you generate in this I call it small business type sale. And that 10 million is there and it's a lifetime cap of 10. So it could be two or three small transactions that get you to 10. So Canada has a similar rule that allows you to get a beneficial tax rate if you sell shares. So again there I was involved with a Canadian structure about 18 months ago; very similar, where the US buyer didn't want to buy shares wanted to buy assets and actually move the business to the US but ultimately bought the shares and then migrated the actual business if you will. A different profile, a different buyer, it was actually a private equity corporate buyer versus in the Joseph transaction it was more of that [inaudible 00:13:06.4] buyer if you will. You need to understand both sides of this; the seller, the jurisdiction, their profile, and also the buyer. Is it a corporate buyer, a partnership buyer, what that's going to be because it drives different tax attributes. Mark: Okay, and that's where some of the complexities come in here with these transactions where after Joseph's episode I had a few people reach out and they're kind of like well what did you guys do there. And I said well I'm not going to go into all the details of everything that we did but you can't have a one size fits all approach here right? You do have to cater it towards… Erich: It is customized; correct. I mean I had a base solution that when you and Scott reached out I say this is the idea. I don't know all the facts so let's have a call with Joseph and see if we can kind of get this to work. So we were able to design what I would call the initial structure and then we showed that with the buyer who said there's no way that we could do a stock deal and get this to work for anybody. I'm sure you can remember their attorney is kind of sulking at that point and they had a national accounting firm involved on their side. A tax attorney from a law firm and they came back a few days later and said we're interested in understanding more. This has merits. We evaluate and keep the tires on and as you know we basically went through a couple of iterations with the buyer or in particular the individual that was going to drive the business; Jared is his first name, very interested in understanding because of the low tax rates that would allow him to have more after-tax dollars to continue to drive into the business to grow it. That's one of his interests. Mark: And to get into that just a little bit more; I mean the structure that we ended up having set up if it was just a US-based corporation and this is all we were doing was US to US you would have had a corporation that would have been taxed at a 38% maximum income tax rate. Erich: 21% federal and then it depends upon the state that you're in. States go up to say 10% so call it a low 30 at the most probably in the corporate world. Correct. Mark: And that would be just for a regular company like a regular LLC would get that? Erich: No, a regular corporation. Mark: A regular corporation; C corp. Erich: C corp; correct. You'll get into the realm of an LLC if it has one owner it gets taxed and it's an individual gets taxed basically in his personal tax return at individual rates because it is effectively a disregarded entity. And then if the LLC has more than one around its tax is a partnership and then the partner is it a corporate partner or an individual partner and it goes either to an individual up to 37% federally plus states and then if it's a corporate partner and get back to the 21% and so on. In those transactions when it's domestic the profile again of the seller is important. Many times you hear that the buyer wants to buy assets so that if they pay the premium was this intangible; to get a little technical this section 197 intangible but can be advertised over for 15 years. So that's why they like to buy assets so they can get a step up as we call it. But if the seller is an S corporation and you thought; let's just say it's one guy who owns this S corporation and he's running down the business to that you can still sell shares legally but if the buyer has stepped up because there's a special election that can be made; the so-called Section 338(H)(10) election which yes legally it's a sure transaction but for tax purposes it's deemed an asset sale which then allows the buyer to get this intangible asset amortized over 15 years. And in these transactions where you do the election typically what you see is because it is an asset sale for tax purposes and the seller doesn't get capital gains treatment because it was legal to sell shares the election takes that away and teaches an asset sale. They typically get a premium on the purchase price because the buyer gets a step up for the premium. So kind of the rule of thumb that I've always heard over the years is typically it's anywhere from 14 or 15% to maybe 18 or 19% premium over the share purchase price because of the step up. Mark: Right. So, in this case, the buyer gets the ability to depreciate the assets over the 15 years that they would normally have in an asset sale which obviously is a huge advantage from a basis. Erich: We're covering a lot of ground but yes. Mark: We are. My head is spinning. And look if you're listening to this and your head is spinning as well you are not alone. I worked on this transaction and my head is still spinning. The structure that was proposed in this transaction had the structure that you had proposed and adopted. It would have represented a go forward savings for the buyer of some pretty significant amounts of money in terms of taxes that they would have. One of the obligations of that structure, if I'm not mistaken, would have been to continue to operate in the UK with UK entities. Is that also correct? Erich: That is correct; yes. We have designed the structure when we bought a structure to Joseph that we presented that would have resulted in the buyer forming a UK holding company to do the transaction so that we could then if we wanted to have debt cross-border which is between the US and the UK. They also decided they didn't want to do that part as we kind of filmed it up but that gives you one moving part. And that's important on when you've got cash in the UK coming back to the US the UK does not have a withholding tax on its domestic laws so the dividends can come out of the UK without a withholding tax. And under the new rules unless we were talking about forming a C corporation the buyer; then the UK holding company and under the Trump tax reform if you will from the end of '17 dividends come out of the UK without a withholding tax and come back and are not subject to tax because of the 100% dividends received deduction. There's some other complications that we don't need get into but tax reform brought in a new rule; the acronym is GILTI but the C Corporation helps with that and so forth. So ultimately as this was structured the operations basically remaining in the UK that is what allowed the tax savings because we were basically paying taxes 70% UK rates on the vast majority of the profits. And then ultimately we were going to distribute those out and bring them back two or three years later tax-free. Mark: Do you remember offhand; I mean I'm not sure how specific we want to get here but do you remember offhand what magnitude of savings we were talking about over the course of the three year period? Was it a few hundred thousand dollars in tax savings? Erich: It was more than that and it potentially was going to be' let me just think real quick, it was north of a million dollars. I want to recall it's a 1.3 million over three or four years because of the growth that they were anticipating through the injection of additional capital that the buyer was going to make as I recall. Mark: Yes. That's what I recall as well. I bring it up because I can imagine somebody listening to us is thinking I left a corporate job and what do I want to do? I want to run an Amazon business. I want to do something sort of simple now. And they're listening to this thinking wait I have to have operations based in the UK. What are the obligations there? We actually explored that question in the process of this deal of what were the obligations going to be and I don't want to be coming across offering legal advice on this but I believe it required maybe a once per year visit to the UK and having some people in the UK for those operations if I recall correctly. Erich: Correct. I mean again we're not giving anybody advice. We're kind of talking about something we did back in June or July. Basically, the idea was that we were going to continue to run the business in the UK. It would be that two or three people that were running the business would continue to do it. Joseph as you mentioned he was going to remain as an adviser to the business for a period of time etcetera. And the buyer their role in all of this I think what we were told that was one of the government's aspects of this because within forming a UK holding company Joseph ultimately say two years later was going to go away we were taught we did board meetings. And we kind of got into this concept of the UK has its mind and management issue of where are you running the business from. And with the employees in the UK and with Jarrett going to the UK a couple of times a year after year-end; after the books were closed and approving the accounts and all of those things. That was some of what I would call the operational substance that remained in the UK that allowed it to work. Mark: Yeah. And so we're I mean to lead or my mind goes from just advising buyers in various aspects over the years is potential opportunity here on behalf of buyers. If they're able to set up a structure; I imagine that this is a structure that could probably be used and once it's set up you use it for multiple acquisitions within the UK. See some of these tax savings as well on a go-forward basis and be able to open up a deal flow that might not exist otherwise here in the US. Once the structure is set up and I'm trying to think about how to ask this question the right way but how reusable is it in your opinion or does each deal really require its own development of new companies to be able to manage this? In other words, there's a C corp here in the US for the structure, do we need to set up a new C corp with every acquisition that we do or can we use just one general holding pass through C corp? Erich: I see what you're saying. No, the structure; let's just say that they would have been forwarding exactly as we initially designed it and it was all going to work like we had kind of painted that picture and they said yeah we're interested and we need to dig into this. We would only need; if the buyer was going to do self-additional deals and kind of do a roll of three or four or five Amazon businesses from the UK. They just need one sequel. We would have stayed with the one holding company. And then what we would have done is then bought the additional UK targets under that holding company. So I wouldn't call it an acquisition platform for a buyer. You just keep bolting on the next one you if you will. So you're not creating additional sequels and or UK holding company. Mark: Right. So you gave us an acquisition platform is a perfect way to describe it. I saw this as an opportunity. I know Joseph and I talked about a little bit. I also just had Scott who was another advisor on this deal on and we talked about it just a little bit as well. Okay, this is all very… Erich: It's interesting because another one of your UK Amazon sellers that you and Scott know reached out to me last week and I'll call it for personal reasons and potentially for exit. He's actually moved to Cyprus and he has a couple of Amazon businesses and a couple of UK companies and also a US Amazon business and a US C corp. And we're looking at how to design a structure for him to continue to build that out because he wants to kind of; I don't know exactly where it's at but let's just say he's at 10 million in revenue and he wants to double that before he wants to take all of it or some of it to market so that he can grow it and package it in a way where it's easy to actually sell to allow him to again take advantage of tax rules in Cyprus or Dubai or some other things that we're talking about. Again it's him because he's got some one way and he's single and flexible as to where he wants to live he's putting himself in a position where he can significantly reduce or eliminate any sell-side taxes down the road so that he can punch his lottery ticket as he put it to me. Mark: Yeah. And I want to emphasize something here because I think people hear some of this stuff and they think oh my gosh this is complex. Is it legal ball and is it going to be triggering an audit and everything else? That's why I wanted to start with your background. Your background isn't just some guy who's on the internet researching things, right? Erich: No, no, no, in fact, it's interesting. We did have one call and we have another call on Friday. He has been getting some advice from Cypriots tax advisor and a lot of the concepts that he was putting out there I didn't disagree with but there were some things that they were talking about that I told this individual that I have some concerns. We need substance. We can't play shell game. Some of the things that were being said could be interpreted as tax avoidance. And I said those are the type of things that I would never advise you to do because if you want to sell this and the buyer comes in they're going to do tax due diligence on your structure and they're going to say well okay you've done all of that but if you want us to buy the shares and you don't pay any tax well there's a tax accrual of there's going to be a big number going to Escrow until we get this sorted out. So I agree with you completely Mark, understanding the risk profile and what you're doing is important because I told him if you go to that path I'm not going to be that advisor that can help you. So he got the risk conversation and we just signed an engagement letter and he wants to move forward to do it properly. This whole risk thing I mean look at some of these transactions that you see the buyers are using large law firms or accounting firms and are beating up on the debt tax due diligence side and putting money on Escrow because they're concerned about for example sales tax. Mark: Sure sales tax liability which came up and you and I could talk about it at length which we won't because we'll get into something else. But these are some of the practices that happen at a more sophisticated deal-making level than what we might normally see with just a simple transaction. This is not uncommon to go through some various tax scenario analyses and figure out a structure that works for the seller and works for the buyer and minimizes taxes on a go-forward basis and the savings can be significant for everyone. Erich: Exactly that's why on Joseph's transaction the buyer was originally a naysayer before I got involved as you know. And then once we put on the table and they start to understand what was going on their advisors to the table so that they could pick it apart and they said this has merit let's work through this. So that's typically how it's going to evolve. It's not going to be Erich says this is how it's going to work. I mean everyone's going to have someone else look at it and get comfortable or not. You have to protect your clients. And that's my example with the guy that just moved to Cyprus. I'm not going to put him in a position where he thinks he's saving all this money but no one's going to want to buy the shares of this company because of the bad tax structure he's put himself into with all of the risk. Mark: Right. And ultimately in the Joseph deal, they didn't accept the very first proposal that we put together it was a variant of that. Yeah, these things are collaborative in that way. Okay, we've been talking for about 25 minutes. I'm going to wrap it up here because if we go into another topic we'll go all the way up to that my brain hurts. If we have somebody who's interested in talking about this more Erich where can they reach you; what's the Most Unexceptional way to reach you? Erich: Well they could reach me here at Redpath. My office is in St. Paul. I don't know when you publish this or post this; if you can provide my email address which is epugh@redpathcpas.com. Mark: And if anybody wants an introduction just let me know. I'm happy to provide the introduction. Erich, you are a great resource I think for anyone in this space especially if you are doing anything international or even thinking about it on an international basis. A really, really good resource to have; I appreciate it. And your firm as well is a good resource just in general. It's not just an international tax law firm; you guys do the whole gamut. Erich: Correct. Yeah, we were actually over this over the last three or four months through; you and Scott connected with a number of companies. In fact, we've just brought on board a larger Amazon business and are doing the bookkeeping and providing other services including restructuring their business for sale as a domestic business in the US. Mark: That's great. Thanks for coming on. And again if somebody wants an introduction to Erich let me know I'm more than happy to provide it as a way of saying thanks for coming on and also helping out with that deal. It was an eye-opening exercise for me for sure. Erich: Thanks a lot Mark. Take care and have a good rest of the day. Links and Resources: Erich's Redpath Profile Contact Erich

The SALT Show Episode 80 (Update for Week of October 13, 2019) On this week's episode: • How to argue constitutional issues before administrative bodies • Louisiana constitutional amendment to allows Board of Tax Appeals to hear constitutional issues • Louisiana issues guidance treating GILTI as dividends • Florida queues up Wayfair and marketplace facilitator legislation • Preview of COST 50th Annual Meeting Links to share the podcast with colleagues: bakerbotts.com, iTunes, Stitcher, GooglePlay, Podbean, Spotify  

The SALT Show Episode 74 (Update for Week of September 1, 2019) On this week's episode: • Remote seller legislation makes its way to remote Nome – and musings on Wayfair implications for local sales tax • Another Texas court holds that telecom products do not qualify for the cost-of-goods-sold deduction • Updates on the never-ending saga of New Jersey GILTI guidance • Updates on the first meeting of the MTC's Wayfair Phase II working group. Links to share the podcast with colleagues: bakerbotts.com, iTunes, Stitcher, GooglePlay, Podbean, Spotify

The SALT Show Episode 72 (Update for Week of August 18, 2019) • New Jersey withdraws its quirky GILTI apportionment notice • Kansas lawmakers may not be pleased with the DOR's crazy remote seller nexus position • A constitutional amendment to make it easier to pass local taxes in California fails & related litigation • How to retroactively elect out of technical terminations with the California Franchise Tax Board • Texas is floating a $500,000 franchise tax nexus threshold Links to share the podcast with colleagues: bakerbotts.com, iTunes, Stitcher, GooglePlay, Podbean, Spotify

The SALT Show Episode 69 (Update for Week of July 28, 2019) On this week's episode: • The saga continues: Pennsylvania severance tax legislation • Washington Supreme Court strikes down ban on local income taxes (Kunath v. Seattle) • Is the Oregon CAT referendum dead? • San Fran stock compensation tax on hold…for now • California market-based sourcing reg project: word on the street • New York draft apportionment regs & the unusual event rule • New York City going another direction on GILTI • New Hampshire getting frisky with other states • Texas treatment of retailers/wholesalers holding intangible rights in goods they sell Links to share the podcast with colleagues: bakerbotts.com, iTunes, Stitcher, GooglePlay, Podbean, Spotify

The SALT Show Episode 67 (Update for Week of July 14, 2019) On this week's episode: • A primer on judicial deference to administrative agencies in SALT litigation and the Kisor case • A couple of GILTI updates – Oregon and New York • Oregon passes CAT correction bill • Louisiana passes passthrough entity SALT deduction cap workaround • Texas cost of goods sold in the Supreme Court (AMC Theaters) Links to share the podcast with colleagues: bakerbotts.com, iTunes, Stitcher, GooglePlay, Podbean, Spotify

The SALT Show Episode 51 (Update for Week of March 24, 2019) On this week's episode: • An overview of the Foreign Commerce Clause's prohibition on discrimination against foreign commerce and how it might apply to GILTI Links to share  the podcast with colleagues: bakerbotts.com, iTunes, Stitcher, GooglePlay, Podbean, Spotify