Tax reform readiness: The proposed ‘toll charge’ regulations

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August 2018


The 2017 tax reform act (the Act) includes significant international tax provisions, including Section 965, which imposes a ‘toll charge’ on deemed repatriated earnings. On August 1, Treasury and the IRS released a 249-page set of proposed regulations under Section 965, addressing a wide range of issues regarding the toll charge.

PwC on August 9 hosted a webcast featuring PwC specialists who discussed the proposed Section 965 regulations. This Insight highlights some of those discussions. Watch the webcast replay and register for future webcasts in PwC’s Tax Reform Readiness series, which addresses other areas affected by tax reform.

The next webcast — Tax reform readiness: The politics of implementation — will take place on Wednesday, August 22, from 2:00 PM - 3:00 PM (EDT).

For prior coverage of the toll charge, see PwC Insights, IRS Notice addresses the ‘Toll Tax’ under amended Section 965, January 3, 2018; Tax reform readiness: US mandatory deemed repatriation considerations, January 10, 2018; Treasury and IRS release second notice on toll tax, January 19, 2018; Treasury and IRS release third notice on toll tax, April 2, 2018; Tax reform readiness: Recent IRS guidance clarifies key international tax issues, May 10, 2018; and IRS issues lengthy proposed rules on toll tax’ under amended Section 965, August 8, 2018.

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The takeaway

Taxpayers should evaluate which provisions in the proposed regulations affect their Section 965 liability and recompute their Section 965 calculations accordingly. They should have a plan for the next three months, and determine staffing needs and how to collect the required information.

The proposed regulations leave room for improvement and opportunities for change. Taxpayers can comment on the proposed rules. Comments must be submitted by Tuesday, October 9, 2018 (60 days after the regulations were published in the Federal Register).

Contact us

Doug McHoney

International Tax Services Co-Leader, PwC US

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