IRS Issues Final and Proposed Regulations on BEAT: The Final Regulations Retain the General Framework of the 2018 Proposed Regulations with Important Clarifications. New Proposed Regulations Add an Election to Waive Deductions to Avoid the Threshold for BEAT Application.

Sullivan & Cromwell LLP - December 6, 2019
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On December 2, 2019, the Internal Revenue Service and the Treasury Department issued final regulations and proposed regulations on the base erosion and anti-abuse tax.  As discussed below, the final regulations adopt the general framework and many of the provisions set forth in proposed regulations that were published on December 21, 2018 in the Federal Register, with certain modifications.  The new proposed regulations propose a few additional modifications including, most significantly, an election to waive deductions for all tax purposes to avoid the threshold for BEAT application.