INCOME TAX

T.D. 9959, page 328. This document contains final regulations relating to the foreign tax credit, including the disallowance of a credit or deduction for foreign income taxes with respect to dividends eligible for a dividends-received deduction; the allocation and apportionment of interest expense,

Finding Lists begin on page ii.

foreign income tax expense, and certain deductions of life insurance companies; the definition of a foreign income tax and a tax in lieu of an income tax; the definition of foreign branch category income; and the time at which foreign taxes accrue and can be claimed as a credit. This document also contains final regulations clarifying rules relating to foreign-derived intangible income.

T.D. 9961, page 430. These final regulations provide guidance on the tax consequences of the discontinuation of interbank offered rates (IBORs) that is expected to occur in the United States and many foreign countries. The final regulations mitigate many of the tax consequences that might otherwise arise when a taxpayer modifies a contract that references a discontinuing IBOR in anticipation of that discontinuation. For example, under the final regulations, modifying a debt instrument or derivative contract to replace a LIBOR-referencing rate with a qualified rate generally is not treated as a realization event for federal income tax purposes. The final regulations also mitigate tax consequences under the rules for integrated transactions and hedging transactions, withholding under chapter 4 of the Code, fast-pay stock, investment trusts, original issue discount, and real estate mortgage investment conduits.