NEW YORK—The Internal Revenue Service is working to issue regulations regarding reporting requirements with respect to foreign corporations, including related banking entities, IRS Office of Associate Chief Counsel (International) Senior Technical Reviewer Mark E. Erwin said Oct 3.
The project is currently not listed on the IRS priority guidance plan, but “[o]ur office in ACCI is interested in refocusing on a project with issuing regulations under 6038C,” Erwin said.
Internal Revenue Code Section 6038C requires corporations with foreign ownership that are engaged in a trade or business within the United States to provide to the Treasury Department certain information and financial data, including transactions among related parties and a description of the relationship among the related parties.
While the data may currently be requested from taxpayers during an audit, Erwin said issuing regulations requiring the disclosures will give “teeth” to such requests. “We recognize that documentation is critical in the context of these audits, ”he said.