We recently posted a blog about foreign derived intangible income (FDII), a new deduction for certain domestic corporations. Since then, the IRS has issued proposed regulations for FDII under Section 250 of the Internal Revenue Code. According to the IRS, “The proposed regulations provide guidance on both the computation of the deductions available under Section 250 and determination of FDII. In addition, the proposed regulations provide rules for the computation of FDII in the consolidated return context.”[efn_note]https://www.irs.gov/newsroom/irs-issues-proposed-regulations-on-deduction-for-foreign-derived-intangible-income-and-global-intangible-low-taxed-income[/efn_note]
The proposed regulations also describe new reporting rules requiring the filing of Form 8993. The IRS welcomes public comments on the proposed regulations.
We will keep you informed on this topic as it develops. If you have any questions about FDII, please reach out to our International Tax Group.