Ernst & Young Its Washington Dispatch

House Ways and Means Committee Chairman releases comprehensive tax reform draft -- Senate Foreign Relations Committee holds treaty hearing -- Government issues more FATCA guidance -- IRS releases Transfer Pricing Roadmap -- OECD offers Common Reporting Standard, Model Competent Authority Agreement -- OECD updates BEPS action item timeline.

Congress reconvenes in January, passes "omnibus" appropriations bill -- President Obama delivers States of the Union and calls for corporate tax reform -- IRS issues temporary and proposed anti-inversion regulations -- IRS releases final FATCA Foreign Financial Institution Agreement -- IRS issues temporary and proposed PFIC regulations -- Final and proposed regulations on dividend equivalent payments on notional principal contracts and other equity-linked instruments issued -- US signs 7 FATCA intergovernmental agreements -- OECD releases draft country-by-country reporting template for comment -- OECD provides an update on the BEPS Action Plan; digital economy focus still on track

Senate Finance Committee releases international tax reform discussion draft -- House-Senate conference committee on FY '14 Budget closing in on 13 December deadline -- IRS issues new proposed APA procedures -- IRS proposes updated procedures for competent authority requests -- IRS rules on effect of Section 302(a) redemption on post-'86 E&P and foreign tax pools -- OECD holds BEPS public consultation

Update on US budget and debt crisis -- IRS rules "production" activities include "growing" activities for subpart F manufacturing exception -- US, Switzerland delay FATCA IGA for 6 months -- OECD memo seeks input on country-by-country reporting -- OECD meets with business on BEPS -- OECD issues report on encouraging innovation via tax incentives

Status update on US tax reform -- IRS opens online FATCA registration system -- US, Cayman Islands initial FATCA Model I IGA -- IRS 2013-2014 Priority Guidance Plan released -- IRS finalizes certain cost sharing regulations on determining taxable income -- US-Belgium competent authority agreement released

OECD releases base erosion and profit shifting (BEPS) action plan -- OECD releases revised Discussion Draft on the Transfer Pricing Aspects of Intangibles -- OECD White Paper on Transfer Pricing Documentation issued -- President Obama resumes call for business tax reform -- IRS revises FATCA timelines, provides other guidance -- IRS releases updated Model 1 and Model 2 FATCA IGAs -- IRS will cease granting rulings to early adopt 2006 Section 987 proposed regulations -- CTB regs to add Croatian Dionicko Drustvo to per se list corporations -- US Tax Court has jurisdiction to review cancellation of APAs under abuse of discretion standard

G8 summit calls for greater transparency with tax authorities -- OECD provides update on BEPS project -- House Ways and Means Committee hearing highlights MNCs’ use of tax havens -- Senate Finance Committee Chairman supports “clean” federal debt ceiling increase -- IRS expands automated Form 5471 penalty program to Form 5472 -- IRS retroactively applies Notice 2012-39 to outbound F reorganization -- US-Brazil TIEA is effective -- US, Japan sign FACTA “statement” -- UN launches Practical Manual on Transfer Pricing for Developing Countries

Debt talks could spur movement on US tax reform -- Senate subcommittee highlights US MNC's tax planning -- US Supreme Court rules UK windfall profits tax creditable under Section 901 -- US officials discuss OECD BEPS report -- IRS officials detail upcoming international tax guidance -- FACTA update -- OECD publishes report on Co-operative Compliance -- OECD publishes new “Draft Handbook on Transfer Pricing Risk Assessment” -- OECD issues final guidance on transfer pricing safe harbors.

Obama Administration's proposed FY 2014 Budget recycles international tax provisions -- US continues momentum on FATCA IGAs -- Tax Court applies step transaction to repatriation transactions -- Partnerships with ECTI allocable to foreign partners must file 2012 Form 8804 for any tax year beginning in 2012 -- US, Norway sign competent authority agreement

Sequester in force, federal government avoids shutdown -- IRS issues regulations on outbound asset reorganizations -- IRS concludes equity-linked debt creates straddle, requires capitalization -- NRA selling US partnership interest engaged in US trade or business had US ECI -- FATCA update -- IRS issues annual APA report -- IRS Competent Authority statistics released -- OECD releases report, "Aggressive Tax Planning Based on After-Tax Hedging"

President Obama delivers State of the Union address; sequester looms -- Ways and Means Committee Chairman releases draft proposals on tax treatment of financial products -- The Cut Unjustified Tax Loopholes Act introduced in Senate -- US and Poland sign new tax treaty -- US, Norway sign mutual agreement on fiscally transparent entities -- IRS proposes changes to rules for failure to comply with GRAs, other filings -- OECD releases report on base erosion and profit shifting

US issues final FATCA regulations -- US fiscal debate turns to sequestration -- US, Japan sign comprehensive tax protocol -- US, Spain sign amending tax protocol -- IRS issues final anti-abuse regulations under Section 304 -- Treasury grants further extension for FBAR reporting signature authority over certain foreign financial accounts -- IRS publishes revised instructions for Form 5471 -- IRS announces domestic entities not required to report interests in foreign financial assets on Form 8938 for tax years beginning before 31 December 2012 -- Noticeable increase in IRS audits of intercompany loans -- IRS closes record-high 140 APA cases in 2012

Congress approves "fiscal cliff" agreement including all tax extenders; sequestration delayed two months -- US initials FATCA agreements with Switzerland, Ireland, and Spain -- IRS expands type of Section 988 FX losses that do not trigger reportable transaction disclosure -- IRS to withdraw Industry Director Directive offering GRA flexibility -- IRS generic advice disregards securities lending transaction based on economic substance -- Tax Court disregards foreign corporation's contribution of built-in loss property to domestic subsidiary

November elections leave status quo unchanged for “fiscal cliff” talks - Treasury issues second Model FATCA Intergovernmental Agreement -- FATCA negotiations moving forward -- REIT’s Subpart F and PFIC inclusions qualify under 95% income test -- IRS releases 2012 - 2013 Business Plan

US extends certain FATCA deadlines -- Tax Court rules hybrid instrument is equity -- UN releases draft Transfer Pricing Manual for Developing Countries - OECD issues model draft provisions on "beneficial ownership," emissions permits and credits, and PEs -- EY Financial Transaction Tax moves forward

US, UK sign agreement on international tax compliance and FATCA implementation -- Congress adjourns for election; attention turns to lame duck session -- IRS issues final, temporary, and proposed regulations on integrated hedging transactions of qualifying -- Temporary regulations issued extending current treatment for notional principal contracts and non-notional principal contracts equity linked instruments -- Iraq added to list of boycott countries

Congress moves tax legislation before adjourning for August recess -- Treasury official provides guidance update -- US, Canada agree on business profits interpretation in PE context -- Draft FATCA withholding form released

Congress reviews tax reform options; territorial tax system enters presidential politics -- US Treasury releases FATCA Model Intergovernmental Agreement -- IRS Notice 2012-39: future regs coming under Section 367(d) affecting outbound transfers of intangible property in asset reorganizations -- IRS regulations clarify prior guidance on ODLs, coordinate with OFL and SLL provisions -- IRS expands PFIC active banking exception for qualifying government bonds -- IRS changes ITIN application procedures

Congress will not extend expired tax provisions as package deal; tax reform focus during "lame duck" session -- Treasury issues FATCA statements with Japan and Switzerland -- US reaches agreement on tax protocols with Japan and Spain -- IRS issues final Section 7874 regulations with bright-line substantial business activities test -- Fifth Circuit rules UK "windfall tax" creditable; split in Circuits -- US Court of Federal Claims dismisses refund suit for self-initiated Section 482 adjustment -- US Customs will accept TP adjustments if conditions met -- OECD issues proposals for revised guidance on transfer pricing of intangibles

US tax reform, 2001/2003 tax cuts, and debt limit back on the radar -- US-Chile tax treaty transmitted to Senate -- IRS finalizes rules on application of Section 1248(a) to gain under Sections 301(c)(3), 302(a) and 331(a) -- IRS modifies definition of US property for US shareholders in CFCs that make certain upfront swap payments -- New tangible property regulations have international tax implications