AICPA Wants IRS Guidance to Shield Foreign-Pension Holders

The IRS’s proposed regulations on foreign trusts should include more safeguards to prevent people with foreign retirement plans from falling under the regulations, the American Institute of CPAs said.

In particular, the IRS should eliminate a proposed anti-avoidance rule aimed at preventing taxpayers from circumventing the reporting rules by arguing that foreign gifts they receive are really loans, the AICPA said in a July 5 comment letter that was released this week. If this proposed provision is not eliminated, it should be “much more carefully targeted,” the group said.

The regulations should also include an exception for treaty-protected foreign pensions ...