Ernst & Young ITTS Washington Dispatch

Congressional Republicans, Trump Administration look to 'phase 2' tax reform -- US opposes taxes singling out digital economy -- IRS issues FAQ guidance on Section 965 transition tax -- IRS expands 'no TIN" list in Notice 2018-20 -- FATCA-related publications released -- IRS issues annual APA report for 2017; substantial uptick in Indian APA filings -- OECD releases third batch of peer review reports on Action 14 -- OECD releases interim report on tax challenges from digitalization -- BEPS Multilateral Convention to enter into force on 1 July 2018 -- OECD releases more guidance on attribution of profits to PEs.

US government moving forward with TCJA international guidance, two more transition notices expected -- IRS guidance under new Section 965 prevents certain foreign corporations from making accounting period changes -- New guidelines issued for delinquent Forms 1120-F and waiver requests -- Treasury may delay Section 987 branch currency regulations until 2020 -- IRS updates Priority Guidance Plan with some TCJA international provisions -- IRS assumes major role in OECD's International Compliance Assurance Program -- IRS announces increase in user fees for unilateral and bilateral APAs -- OECD releases additional CbCR guidance, country approaches to CbC reporting

US Treasury addresses TCJA guidance -- IRS begins filling in details on TCJA's new Section 965 transition tax on foreign earnings -- Treasury grants yet another extension of time for reporting signature authority (FBAR, Form 114) over certain foreign financial accounts -- IRS LB&I issues instructions for examiners on transfer pricing selection issues -- IRS limits use of mandatory transfer pricing IDR, instructs examiners on penalties in TP cases -- OECD launches International Compliance Assurance Program pilot.

US enacts comprehensive tax reform; revamps international tax rules -- Tax accounting among top issues following enactment of US tax reform -- EU officials reviewing US international tax reform measures -- IRS issues guidance on transition tax on foreign earnings -- IRS proposed regulations may alleviate foreign currency tax asymmetries for CFCs, provide new mark-to-market election for certain FX transactions -- IRS suspends withholding obligations under TCJA's new Section 1446(f) -- IRS issues proposed regulations on international rules under BBA partnership audit regime -- OECD releases second batch of peer review report on BEPS Action 14 -- OECD releases first annual peer review report on BEPS Action 5 -- OECD invites taxpayer input on fourth batch of peer reviews of BEPS Action 14

US House and Senate pass competing tax reform bills – IRS concludes GRA becomes fixed on date of initial transfer – IRS may not complete planned competent authority agreements for CbCR by year end – US-Argentina tax information exchange agreement in force – IRS outlines additional international tax compliance initiatives – US to appeal ruling IRS violated APA regarding anti-inversion regulations – OECD releases additional CbCR guidance – OECD issues 2016 MAP statistics – OECD Council approves 2017 update to Model Tax Convention – OECD holds second consultation on attribution of profits to PEs, and profit splits – OECD publishes updated TP country profiles

US Congress gains momentum on tax reform; House W&M releases reform bill – Treasury outlines future actions on international regulations under Executive Order review -- Treasury to delay application of final Section 987 regulations by one year -- Treasury / IRS 2017-2018 Priority Guidance Plan shifts focus to reducing burdens and complexity -- OECD publishes two handbooks on CbCR - OECD releases progress report on preferential regimes under BEPS Action 5

Republican tax reform framework released; action moves to Congressional tax-writing committees – IRS offers relief for financial institutions required to obtain and report TINs – IRS issues proposed regulations on registration-required obligations and registered form rules – IRS issues updated draft APA template – OECD releases further CbCR guidance – OECD releases US peer review report on BEPS Action 14 minimum standards

Trump Administration, Congressional Republicans to renew focus on tax reform -- US extends transition period for applying certain parts of Section 871(m) regulations -- OECD releases report on branch mismatch arrangements.

House border adjustability will not be part of US tax reform -- Nomination of next Treasury Assistant Secretary for Tax Policy advances in Senate -- IRS delays Section 385 documentation requirements by one year-- US signs more CbC competent authority arrangements -- New IRS CbC reporting site offers latest forms and guidance – Government issues corrections to reporting / withholding regs under FATCA, Chapters 3 and 61-- Deadline for MNCs to request suspension of MAP-related deadline under Mexico-US tax treaty -- Tax Court refuses to follow IRS guidance subjecting foreign investors to US tax on dispositions of partnership investments -- Tax Court holds US parent's CFCs held US Property under Section 956 from intercompany transactions -- Tax Court rules IRS abused discretion in cancelling APAs -- OECD releases update of Guidance on the Implementation of Country-by-Country Reporting -- OECD releases draft 2017 update to the OECD Model Tax Convention -- OECD releases 2017 Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations -- OECD updates G20 Leaders on tax progress -- OECD, UN, IMF and World Bank issue toolkit to address difficulties in accessing comparable data for TP analysis.

Trump Administration to deliver detailed tax reform plan to Congress following August recess -- IRS signing competent authority agreements for CbCR exchanges -- IRS reviewing options for FTINs -- IRS LB&I reviewing how transfer pricing cases selected -- 68 jurisdictions sign Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS -- OECD seeks taxpayer input on BEPS Action 14 peer reviews -- OECD releases revised discussion drafts on profits splits, attribution of profits to permanent establishments.