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Final regulations: BEAT provisions under section 59A

Final regulations: BEAT provisions under section 59A

The IRS this afternoon posted on its website a version of final regulations (T.D. 9910) as guidance regarding the base erosion and anti-abuse tax (BEAT) imposed on certain large corporate taxpayers with respect to certain payments made to foreign related parties.

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These final regulations concern measures enacted by the 2017 U.S. tax law (Pub. L. No. 115-97) or the law that is often referred to as the “Tax Cuts and Jobs Act” (TCJA), and provide guidance under sections 59A, 1502, and 6031 regarding certain aspects of the BEAT. According to a related IRS release—IR-2020-200—the final regulations provide detailed guidance regarding how to compute certain BEAT calculations for groups of related taxpayers; contain rules permitting taxpayers to waive deductions for purposes of the BEAT; and include additional guidance regarding partnerships and anti-abuse rules.

Read the final regulations [PDF 335 KB] (103 pages).

The version of the final regulations released by the IRS today includes the following statement:

This document is in the process of being submitted to the Office of the Federal Register (OFR) for publication and will be pending placement on public display at the OFR and publication in the Federal Register. The version of the proposed rule [sic] released today may vary slightly from the published document if minor editorial changes are made during the OFR review process. The document published in the Federal Register will be the official document.

The purpose of this report is to provide text of the final regulations. Additional information will be provided in a future report from KPMG.

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