IRS Prioritizing Guidance on Anti-Abuse Rule for Foreign Income

The IRS is working on guidance to clarify how a new anti-abuse rule included in Republicans’ 2025 tax law will apply across the part of the US tax code that deals with income from US-owned foreign subsidiaries.

Work on the project is a “very high priority” for the IRS, Mallory Mendrala, senior technical reviewer at the Office of Chief Counsel, said Thursday during a Practising Law Institute event in San Francisco. She added the agency hopes to get guidance out this year.

The guidance under development details how Section 951B interacts with Subpart F, which determines the treatment of income ...