WASHINGTON – Today, February 13, 2018, the U.S. Treasury Department and the Internal Revenue Service (IRS) announced modifications to the procedures for changing the accounting period of foreign corporations owned by U.S. shareholders that are subject to the transition tax under the Tax Cuts and Jobs Act.
On December 29, 2017, the Treasury Department and the IRS provided initial guidance on computing the transition tax in Notice 2018-07. On Jan. 19, 2018, the Treasury Department and the IRS provided additional guidance in Notice 2018-13.
Today’s revenue procedure (Rev. Proc. 2018-17) prevents changes to the annual accounting periods of certain foreign corporations in 2017 under either the existing automatic or general procedures if such change could result in the avoidance, reduction, or delay of the transition tax.
Rev. Proc 2018-17 will be published in IRB 2018-09 on February 26, 2018.