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Proposed regulations under section 250 for FDII deductions (text released)

Proposed regulations under section 250 for FDII

The U.S. Treasury Department and IRS today released for publication in the Federal Register proposed regulations (REG-104464-18) as guidance under section 250 concerning the deductions for “foreign-derived intangible income” (FDII) and “global intangible low-taxed income” (GILTI).

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The FDII measures under section 250 were enacted as part of the U.S. tax law (Pub. L. No. 115-97, December 22, 2017), the law that is at times referred to as the “Tax Cuts and Jobs Act” (TCJA).

 

Read the proposed regulations [PDF 863 KB] (177 pages) that are scheduled to be published in the Federal Register on March 6, 2019.

According to a related IRS release—IR-2019-27the proposed FDII regulations provide guidance on both the computation of the deductions available under section 250 and determination of FDII. In addition, the proposed regulations provide rules for the computation of FDII in the consolidated return context. Proposed regulations on the computation of GILTI were released in October 2018. New reporting rules requiring the filing of Form 8993, Section 250 Deduction for Foreign-Derived Intangible Income and Global Intangible Low-Taxed Income, are also described in the proposed regulations.

 

The purpose of this report is to provide text of the proposed regulations. Analysis of these regulations will be provided in future reports from KPMG.

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