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THIS PUBLICATION MAY CONTAIN ATTORNEY ADVERTISING
Temple-Inland Decision Leads to Proposed
Delaware Escheat Reform Legislation
Combatting Foreign Tax Evasion With New
Filing Requirements for Foreign-Owned
Disregarded Entities
Practical Partnership Tips: Electronic K-1s and
Addressing New Partnership Audit Rules
Charitable Contributions: Acknowledgements,
Appraisals and the IRS’s Strict Rules
ARTICLES IN THIS ISSUE
TAX UPDATE
Vol. 2017, Issue 2
Page 4
Page 2
Page 8
Page 11
May 9-10, 2017
New York, NY
EVENT
PEI Private Fund
Compliance Forum 2017
Julia D. Corelli
Jennifer A. O’Leary
PODCAST
‘The New Tax Landscape
for Investment Management’
Gregory J. Nowak
Joan C. Arnold
Steven D. Bortnick
Jennifer A. O’Leary
CLICK HERE TO LISTEN
TO THE PODCAST
2
Combatting Foreign Tax Evasion
With New Filing Requirements for
Foreign-Owned Disregarded Entities
Morgan L. Klinzing | klinzingm@pepperlaw.com
THE NEW REGULATIONS EXPAND THE FILING REQUIREMENTS FOR FORM 5472 TO
INCLUDE DISREGARDED ENTITIES WITH FOREIGN OWNERS WHEN THERE ARE CERTAIN
REPORTABLE TRANSACTIONS.
If a non-U.S. person (individual or corporation) owns 100 percent of the stock of a U.S.
corporate subsidiary, the subsidiary needs to obtain an employer identication number
(EIN) and maintain adequate books and records to be able to prepare its tax return and
Form 5472 (Information Return of a 25% Foreign-Owned U.S. Corporation or a Foreign
Corporation Engaged in a U.S. Trade or Business), on which the ownership of the
non-U.S. owner is reported, along with certain related party transactions. New reporting
requirements nalized on December 13, 20161 now extend those rules to disregarded
entities. A “disregarded entity” is a company, other than a corporation formed under state
law, with a single owner that is not treated as an entity separate from its owner for U.S.
federal tax purposes. For example, an LLC with only one owner is disregarded for U.S.
federal tax purposes, unless it elects to be classied as a corporation.
