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International PLRs of the 24th week of 2013


For the 24th week of 2013, the IRS published the following Private Letter Rulings relating to international taxation.

PLR 201324003 - After a foreign corporation's acquisition of a domestic company through a C reorganization, the payment of a cash settlement to former  shareholders of the domestic company did not invalidate the reorganization.  Code §368(a)(1)(C).  The boot relaxation rule of Code §368(a)(2)(B) was inapplicable because Acquirer assumed Target debt that exceeded 20 percent of the value of Target.

PLR 201324005 & PLR 201324006 - Domestic partnership's depreciable property to be used in a United States possession will not be treated as property that is used predominately outside the United States.  Consequently, the alternative depreciation system ("ADS") under Code §168(g) does not apply to the property and MACRS depreciation can be taken on the property.  The statute did not include the term "domestic partnership" but did include the term "domestic corporation" and the domestic partnership in the PLRs had only domestic corporations as partners.

Tags: 368 Corporate Reorgs, Authority - PLRs / CCAs