Bloomberg Tax
Free Newsletter Sign Up
Login
BROWSE
Bloomberg Tax
Welcome
Login
Advanced Search Go
Free Newsletter Sign Up

Passive Foreign Company Regs Need Clearer Definitions, Group Says

Sept. 19, 2019, 6:30 PM

Treasury should improve its definition of certain terms under rules that help foreign businesses determine whether they are passive foreign investment companies, the Association of Bermuda Insurers and Reinsurers said.

Proposed rules (REG-105474-18) on passive foreign investment companies include guidance on whether an offshore entity is considered a legitimate insurance business. If so, shareholders can avoid higher tax liabilities pegged to a PFIC status.

  • “The terms used to define ‘applicable insurance liabilities’ should have recognized meanings for insurance regulatory and tax purposes and relate to items on financial statements,” the group said in a letter released Sept. 19. ...