Share with your friends

Future regulations, applying sections 951, 951A to certain S corporations with accumulated earnings and profits

Future regulations to address QBAI for FDII, GILTI

The IRS this afternoon released an advance version of Notice 2020-69 that announces the IRS and Treasury Department intend to issue regulations addressing the application of sections 951 and 951A to certain S corporations with accumulated earnings and profits.


Related content

Notice 2020-69 also announces that future regulations will be issued to address the treatment of qualified improvement property (QIP) under the alternative depreciation system of section 168(g) for purposes of calculating qualified business asset investment (QBAI) with regard to the foreign-derived intangible income (FDII) and global intangible low-taxed income (GILTI) provisions—measures that were enacted part of the U.S. 2017 tax law (Pub. L. No. 115-97), or the law that is often referred to as the “Tax Cuts and Jobs Act” (TCJA).

Notice 2020-69 [PDF 104 KB] provides:

  • A summary of the current and proposed treatment of domestic partnerships for purposes of section 951 and 951A and the application of these rules to S corporations
  • Background on sections 168, 250, and 951A as they relate to QBAI for purposes of FDII and GILTI and the treatment of QIP under the alternative depreciation system
  • A description of the anticipated proposed regulations concerning the application of section 951 and 951A to S corporations
  • A description of the forthcoming proposed regulations concerning the treatment of QIP under the alternative depreciation system for purposes of calculating QBAI for FDII and GILTI
  • A description of the proposed applicability dates of the forthcoming regulations
  • A request for comments

The purpose of this report is to provide text of the just-issued IRS notice.

The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us


Want to do business with KPMG?


loading image Request for proposal