Guidance on one-time repatriation tax on foreign earnings

Treasury has announced the release of proposed regulations relating to the section 965 transition tax on U.S. multinational companies’ overseas income that is being repatriated under section 965 of the Tax Cuts and Jobs Act. The proposed guidance affects U.S. shareholders with direct or indirect ownership in certain specified foreign corporations, as defined in the new tax code provision. The proposed rules address a one-time transition tax on post-1986, untaxed foreign earnings of specific foreign corporations owned by U.S. shareholders.