IRS Releases Proposed Regulation on Schedule UTP (Uncertain Tax Positions): IRS Issues a Proposed Regulation That Signals That It Intends To Go Forward With Plan To Require Schedule UTP To Be Filed With 2010 Returns

Sullivan & Cromwell LLP - September 8, 2010

On Tuesday September 7, 2010, the Internal Revenue Service (“IRS”) issued a short proposed regulation that essentially authorizes the IRS to require any corporation to file a Schedule UTP, Uncertain Tax Position Statement, with its annual income tax returns. This filing requirement would apply to returns filed for years beginning after December 15, 2009 (and ending after the date that the regulations become final).

The proposed regulation provides the regulatory mandate necessary to support the IRS’s intent (announced in January 2010) to require certain large corporations to file a schedule identifying for the IRS the tax positions that the corporation identified as “uncertain” during the preparation of its audited financial statements.