Join us for a two day technical and planning session with group live instruction on the latest Subpart F issues affecting the operations of CFCs.

Benefits of Attending

• Overview of Subpart F Provisions
• Foreign Base Company Sales Income – Section 954(d)
• Overview of Sections 954(c) and 954(d)
• Section 1248
• Interaction of Subpart F and Subchapter K Provisions
• Reporting Issues for Disregarded Entities and Allocation of Deductions in Computing Subpart F Income
• Section 956 – CFC Investments in US Property
• Section 959 – Previously Taxed Income of a CFC
• Repatriating Low-Tax Earnings from a CFC

Educational Course Credit — Up to 15 CPE / CLE Credits Available

Substitutions/Cancellations

Cancellations received more than 72 business hours prior to the meeting will be issued a credit. A $350 fee will apply to cancellations received within 72 business hours of the event. No credit card or cash refunds will be issued at any time. For more information regarding administrative policies, such as complaints and refunds, please contact us at 1-914-328-5656, or e-mail info@citeusa.org. Credits will not be issued for "no shows."

Meetings held at conference centers with local hotel recommendations do NOT have rooms blocked

Day One

8:00 AM Registration and Continental Breakfast
 
9:00 AM Chairperson's Introduction and Overview
 
9:15 AM Overview of Subpart F Provisions - Basic Mechanics

• What is a Controlled Foreign Corporation?
• Effect of voting agreements, etc. on CFC determination
• Basic mechanics of subpart F
• Overview of subpart F income definition
• Exceptions to subpart F income definition, including the E&P limitation, de minimis exception, full inclusion rule, and high-tax exception
• Calculating the Section 960 Credit for Deemed Inclusions
• Introduction to previously taxed income accounts

10:30 AM Refreshment Break

10:45 AM Section 954(d) – Foreign Base Company Sales Income

• Review of the foreign base company sales income rules of § 954(d)
• Consideration of the IRS’s recent attack on the “its” defense.
• Review of the application of the Branch Rule of § 954(d)(2)
• Consider the development of the IRS’s response to contract manufacturing structures
• Detailed review and analysis of the newly proposed manufacturing regulations.

12:15 PM Luncheon

1:15 PM Overview of Sections 954(c) and 954(e)

• Detailed review of foreign personal holding company income definition.
• Calculating foreign base company services income and application of the substantial assistance rules
• Review of the foreign base company service rules.
• Consideration of the application of foreign base company services rules to check-the-box subsidiaries
• Preparing for sunset of CFC look-through

2:30 PM Refreshment Break

2:45 PM Section 1248

• Overview of section 1248 and calculation of the section 1248 amount
• Foreign tax credit consequences of recognizing section 1248 amount, interaction with sections 338(g) and 338(h)(16), discussion of CCA 200103031
• Planning for dispositions of CFC stock
• Proposed check-the-box anti-abuse regulations
• Discussion of the so-called “check and sell” technique for sales of first-tier and lower-tier CFCs

4:00 PM Interaction of Subpart F and Subchapter K Provisions

• Using foreign partnerships v. corporations in joint venture planning
• The Tax Court and Eighth Circuit decisions in Brown Group v. Commissioner
• Discussion of final Brown Group regulations
• Developments Resulting from the American Job Creation Act
•  Domestic Subpart F “blocker” partnerships and Notice 2009-7

5:30 PM Meeting Adjourns

Day Two

8:00 AM Continental Breakfast

8:30 AM Reporting Issues for Disregarded Entities and Allocation of Deductions in Computing Subpart F Income

• Form 8858
• Potential increased audit risk for transactions between disregarded entities
• Calculating net foreign base company sales income
• Computation of CFC’s E&P for purposes of the E&P limitation
• Use of accumulated E&P deficits and E&P deficits of lower-tier CFCs to reduce subpart F income

9:45 AM Refreshment Break

10:00AM Section 956 - CFC Investments in United States Property

• Overview of section 956 and mechanics of deemed income inclusion
• Co-ordination of section 956 inclusions and subpart F inclusions
• Definition of “United States Property”
• Application of Notice 2008-91and  discussion of issues in AM2009-013
• Issues involving S 956 and partnerships

11:15 PM Section 959 – Previously Taxed Income of a CFC

• Review of the PTI provisions of § 959
• Proposed S 959 regulations
• Analysis of the foreign currency implications of PTI distributions
• Consideration of PTI planning techniques

12:30 PM Lunch

1:15 PM Repatriating Low-Tax Earnings from a CFC

• Affirmative use of S 956
• Review of Notice 2006-85 and 2007-48, and the “ Killer B “ temporary regulations
• Analysis of proposed stock basis regulations and temporary S 367[a] regulations addressing repatriation via S 304 transactions
• Discussion of alternatives to permanent repatriation of low-taxed income .

2:30 PM Conference Concludes

Bloomberg BNA | CITE Conference Registration - Page 1

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An Overview of the Subpart F Foreign Base Company Sales Income Rules

Agenda - Presented by Rafic Barrage, Meyer Brown LLP

The webinar will provide an overview of the subpart F foreign base company sales income rules, including a description of the general rule and the types of transactions to which it applies, followed by a discussion of the various exceptions to the rule. The webinar will then focus on deferral planning through contract manufacturing arrangements, including the “substantial contribution test” and the “branch” rules.

I. Overview of different types of manufacturing arrangements:

• Buy/sell or contracting manufacturing
• Toll/consignment manufacturing

• Manufacturing exception
• Same-country manufacture exception
• Product sold for use in the CFC’s country of organization exception
• Branch rule

• Activities considered, e.g., quality control
• Through the CFC’s own “employees”
• Employees on payroll of a related company?

• How should companies substantiate their compliance with the regulations, especially in light of their relatively young vintage/no audit history:
  • Documentation, e.g., visits to contract manufacturers, follow-up reports, interviews with employees, logs, etc.
• Tension between ensuring sufficient activities to satisfy the substantial contribution test and avoiding a permanent establishment in the country of the contract manufacturer
• Use of a tax treaty jurisdiction with a favorable PE article whenever possible

• Discussion of basic branch rule:
  • Sales branch
  • Manufacturing branch
• December 2011 finalization of branch rule regulations
• Multiple branches and/or remainder of CFC involved in manufacturing

Attendees will gain an in-depth understanding of the subpart F foreign base company sales income (“FBCSI”)/section 954(d) rules, including:

• A general overview of subpart F foreign base company income—transactions in which it may arise
• The exceptions to FBCSI
• How the rules apply to contract manufacturing arrangements
• Practical aspects