On December 11, the IRS issued Notice 2023-80 (the Notice), announcing that the IRS intends to issue proposed regulations providing guidance on the application of the foreign tax credits (FTCs) and dual consolidated loss (DCL) rules to taxes described in the “Tax Challenges Arising from the Digitalisation of the Economy – Global Anti-Base Erosion Model Rules (Pillar Two).” In particular, under the Notice: taxes imposed under the IIR would generally not be eligible as FTCs, while QDMTT would generally qualify; even if disallowed as FTCs, such taxes are generally not deductible for purposes of determining Subpart F income or GILTI; similarly, IIR taxes are excluded from (added back into income for) the high-tax exceptions for Subpart F and GILTI purposes; and limited relief from the potentially detrimental interaction of DCL rules and Pillar Two taxes would be available for DCLs incurred in or before 2023 (or a portion of 2024 for certain non-calendar year taxpayers). The Notice also extends indefinitely the temporary FTC relief provided by Notice 2023-55 with respect to the application of certain provisions under the 2022 FTC final regulations that narrowed the scope of creditable foreign income taxes and addresses the application of such relief to partnerships and their partners.