Andersen Managing Director Joe Calianno's comments were included in the recent Tax Notes article, IRS Advice Doubles Down on Dividend Exclusion Rule Position.The article addresses recently released IRS Chief Counsel Advice (CCA) ILM 202235009, which for purposes of the Sec. 965 transition tax addresses the tax agency's authority to collect a tax deficiency on notice and demand from a taxpayer that elected to pay the tax in installments. In particular, the CCA focuses on the IRS's ability to accelerate a portion of the Sec. 965 payments if a taxpayer did not follow the Sec. 78 regulations issued by the U.S. Treasury Department that would prevent a taxpayer from taking a Sec. 245A dividend received deduction relating to the Sec. 78 gross up during a gap period that was not specifically covered by the statutory provisions. To resolve the issue, Calianno said that the courts likely will need to determine if the Sec. 78 regulations are valid.

Joe Calianno is a Managing Director in the US National Tax practice in the Washington D.C. office. He advises clients on all areas of international tax, including provisions related to the Tax Cuts and Jobs Act and cross-border restructuring.