SECTION 11. DETERMINATION OF

CREDITABLE FOREIGN TAXES

For purposes of determining the amount of foreign taxes creditable under sections 901 and 902 of the Code, any amounts paid to foreign tax authorities that would not have been due if the treaty country had made a correlative adjustment may not constitute a creditable foreign tax. See Treas. Reg. §1.901–2(e)(5)(i) and Rev. Rul. 92–75, 1992–2 C.B. 197. Acts or omissions by the taxpayer that preclude effective competent authority assistance, including failure to take protective measures as described in section 9 of this revenue procedure or failure to seek competent authority assistance, may constitute a failure to exhaust all effective and practical remedies as may be required to claim a credit. See Treas. Reg. §1.901–2(e)(5)(i). Further, the fact that the taxpayer has sought competent authority assistance but obtained no relief, either because the competent authorities failed to reach an

agreement or because the taxpayer rejected an agreement reached by the competent authorities, generally will not, in and of itself, demonstrate that the taxpayer has exhausted all effective and practical remedies to reduce the taxpayer’s liability for foreign tax (including liability pursuant to a foreign tax audit adjustment). Any determination within the IRS of whether a taxpayer has exhausted the competent authority remedy must be made in consultation with the U.S. competent authority.