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New IRS Practice Unit - IRC 958 Rules for Determining Stock Ownership

2022-08-30

Yesterday the IRS published a new practice unit titled "IRC 958 Rules for Determining Stock Ownership." [link no longer valid]

The direct and indirect ownership rules in Code §958 are important for purposes of determining, among other things:

  1. Whether a U.S. person is a U.S. shareholder of a foreign corporation (Code § 951(b)),
  2. Whether a foreign corporation is a controlled foreign corporation, ("CFC") (Code § 957(a)),
  3. Whether a person is related to a CFC (Code §954(d)(3)), and
  4. Whether the U.S. person is required to file Form 5471 as a Category 4 or 5 filer (Code §6038).

The practice unit discusses the downward attribution rules and the repeal of Code §958(b)(4).  The practice unit includes 16 examples with structure charts showing how the ownership attribution rules work.

Tags: 958 Direct & Indirect O'ship Rules, Form 5471, Other - IRS Practice Units

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