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Treasury Moves to Another, Harder Fix to Foreign Tax Credit

July 28, 2022, 8:45 AM

Treasury tweaked its much-criticized foreign tax credit rules Tuesday, working to address some complaints that the rules are too restrictive. But now comes the harder part.

The department is moving on to another planned fix to the rules that tax practitioners think may be trickier and more complicated. They’re cautiously optimistic that Treasury will do what’s needed, but they think it’s going to be a much heavier lift than this week’s corrections.

After the technical corrections Tuesday, the department is planning a new proposed rule by the end of the summer for resolving complaints about whether royalty withholding taxes qualify ...