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Set up a consultation to explore how our expertise can offer insights and strategies, enhancing your federal income tax savings in ways you haven’t seen before.
Call Us: 857.453.1005
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AM 2022-005 – Treaty Override Rejected for DISC Distributions to Foreign Shareholders
/in Uncategorized/by Paul FerreiraIn IRS Advice Memorandum AM 2022-005, the Office of Chief Counsel reaffirmed that distributions from a Domestic International Sales Corporation (DISC) to foreign shareholders are treated as effectively connected income (ECI) under Internal Revenue Code § 996(g), even where an applicable U.S. income tax treaty would otherwise provide reduced withholding rates on dividends. This position […]
Quick Update: IC-DISC Dividends and Schedule K-2/K-3
/in News/by Paul FerreiraTaxpayers utilizing an IC-DIS should note the continuing importance of Schedules K-2 and K-3 in reporting international income. Since 2022, S corporations and partnerships receiving IC-DISC dividends must include this information to comply with the requirements of Schedule K-2/K-3. Although IC-DISCs are domestic entities (Treas. Reg. § 1.992-1(a)(1)), dividends paid by an IC-DISC are classified […]
Update on the IC-DISC – Schedule K-2/K-3 and the IC-DISC Dividend
/in News/by Paul FerreiraThe IRS’s expanded international reporting requirements have made it essential for S corporations and partnerships with IC-DISCs to understand how to properly report dividends on Form Schedule K-2/K-3. Below is a summary of key developments that may affect Forms 1120S or 1065. 1. Schedule K-2/K-3 Applies to Pass-Through Entities with International Activity 2. IC-DISC Dividends […]