Yoram Keinan Quoted in Bloomberg Tax Article Entitled “U.S. Shareholders May See Second Tax After Offshore Tax Opt-Out”

In the article, Mr. Keinan comments on new final high-tax exclusion rules, under Section 954(b)(4) and Section 951A of the tax code, which Bloomberg explains has “expanded the kind of foreign income eligible to be free from U.S. tax if the income, known as global intangible low-taxed income (GILTI) is already taxed offshore at least 18.9%.”

The article notes:

Deciding to go for the high-tax exclusion or the dividends-received deduction could be even more challenging for companies that frequently engage in M&A activity. That’s because an incoming asset could dilute the benefit of the 245A deduction following an acquisition. …
 
Companies should carefully consider how the 245A limitations will apply to future payouts if they decide to use the high-tax exclusion, practitioners said. 
 
“The best advice for companies at this point is to beware of the 245A risks, but you’re not dead in the water—if you satisfy 245A conditions you’re still OK to take the deduction,” Yoram Keinan, partner at Kostelanetz & Fink, LLP, said.

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