Proposed loss importation regulations have broad scope

September 2013


Recently, the IRS and Treasury Department published proposed regulations for determining when the anti-loss importation provisions apply. They conclude that the provisions apply even if gain or loss would be recognized by someone other than the transferor on a hypothetical sale immediately before the transfer. For example, the proposed regulations apply the anti-loss importation provisions to a CFC’s transfer, even if that CFC’s sale of the property would result in a US shareholder’s subpart F inclusion.

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