This article addresses complex topics in a summary fashion and does not exhaustively discuss all potential issues. It is not intended to be legal advice and cannot be relied upon as such.
On August 1, the IRS released 250 pages of explanations and proposed regulations (the “Proposed Regulations”) related to the transition tax that is found under Code section 965 of the Internal Revenue Code (the “Code”). The most important part of these regulations relate to how US citizens in Canada, that are subject to the transition tax under Code section 965, can use taxes paid to Canada to minimize their double tax exposure. Continue reading