Tax Headlines

1827

Rules on Characterization of Gain from Foreign Corporation’s Stock-Related Distributions Amended (T.D. 9585)

The IRS has finalized regulations under Code Sec. 1248 that provide that gain recognized on the receipt of a distribution of property from a foreign corporation with respect to its stock is gain from the sale or exchange of the corporation’s stock for purposes of Code Sec. 1248(a). For purposes of Code Sec. 1248(a), a sale or exchange also includes a distribution that gives rise to gain with respect to stock under Code Sec. 302(a) or Code Sec. 331(a).

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Georgia ~ Sales and Use Tax: Tax on Vehicles Repealed, Click-Through Nexus and Incentive Provisions Enacted, Tax Holidays Re-Enacted

Georgia Gov. Nathan Deal has signed legislation containing sales and use tax provisions related to the taxation of motor vehicles, nexus, incentives, and tax holidays. Developing details of the bill pertaining to sales and use tax were previously reported. (TAXDAY, 2012/03/22, S.6; TAXDAY, 2012/03/26, S.10)

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CCH Weekly Report from Washington, D.C.

Despite a veto threat from President Obama, the House on April 19 passed a measure that would provide a 20-percent tax cut to small businesses. A day earlier, lawmakers passed another extension of highway funding and fuel taxes. The Senate, meanwhile, rejected a bill that would have levied a minimum 30-percent tax rate on the adjusted gross incomes of households earning more than $1 million annually. The IRS issued proposed regulations that would provide additional examples of program-related investments (PRIs) that a tax-exempt private foundation may make.

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Specifications for Preparing and Using Substitute Forms W-2c and W-3c Updated (Rev. Proc. 2012-22)

The IRS has issued updated requirements for preparing and submitting substitute Forms W-2c, Corrected Wage and Tax Statement, and Forms W-3c, Transmittal of Corrected Wage and Tax Statements. Along with exhibits and instructions on how to obtain the forms, guidance is provided for filing the forms electronically with the Social Security Administration (SSA), for filing substitute paper copies of Red-Ink Forms W-2c (Copy A) and W-3c with the SSA, for filing laser-printed substitute Forms W-2c (Copy A) and W-3c with the SSA, and for furnishing substitute privately printed Forms W-2c (Copies B, C, and 2) and W-3c to employees, as well as instructions for employers regarding retention of information and copies and guidance regarding approval of the forms from the Office of Management and Budget (OMB).

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Washington ~ Multiple Taxes: Bill to Limit Financial Institution Mortgage Interest Deduction, Extend Food and Data Center Exemptions Passes Legislature

A bill passed by the Washington Legislature would limit the financial institution business and occupation (B&O) tax deduction for mortgage interest to community banks. Specifically, the bill provides that a financial business located in more than 10 states may not deduct amounts received as interest on loans secured by first mortgages or trust deeds on nontransient residential properties.

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