Editors Note: IRS Notice 2018-13 was released after we published, see our latest blog post to learn more, IRS Notice 2018-13: How it Affects Your Toll Tax Model
Since our last blog post about the deemed repatriation “toll tax,” tax reform was enacted into law on December 22, 2017. The SEC has also issued guidance on tax accounting for the deemed repatriation (SEC Staff Accounting Bulletin No. 118 (“SAB 118”), December 22, 2017), and the IRS has issued preliminary guidance on proposed regulations concerning calculation of the transition tax (Notice 2018-07, December 29, 2017). As companies work to estimate the tax effects of deemed repatriation for financial statement purposes, take this opportunity to:
· Review the calculation of the toll tax as enacted;
· Review the current state of accounting for deemed repatriation under ASC 740; and
· Provide a sample audit checklist of steps which should be completed to support the tax provision as it relates to deemed repatriation
