Some of the highlights include the following: The Greenbook includes numerous proposals to reshape the international tax landscape. Taxpayers would be allowed to claim a book tax credit (generated by a positive book income tax liability) to reduce regular tax in future years, but not below the book tentative minimum tax in that year. The book income tax would then be equal to the excess, if any, of the book tentative minimum tax over the regular tax. In particular, under this proposal, the book tentative minimum tax would be equal to 15% of worldwide pre-tax book income (calculated after subtracting book net operating loss deductions from book income), less applicable general business tax credits (including R&D, clean energy and housing tax credits) and foreign tax credits. The Greenbook also proposes a 15% minimum corporate income tax on worldwide pre-tax book income (i.e., the net income reported to shareholders) for corporations with such income in excess of $2 billion, effective for taxable years beginning after December 31, 2021. For taxable years beginning after Januand before January 1, 2022, the tax rate would be equal to 21% plus 7% times the portion of the taxable year that occurs during 2022. The Greenbook proposes to increase the corporate income tax rate from 21% to 28%, effective for taxable years beginning after December 31, 2021. Some of the proposals that may be of particular interest to such taxpayers are discussed below. While it remains to be seen whether the proposals in the Greenbook will be enacted into law, they may have significant effects on corporate taxpayers and their shareholders. The Greenbook provides additional detail regarding the tax proposals previously included in President Biden’s “Made in America Tax Plan” and “American Families Plan” that we discussed in prior client updates (including those available here and here), as well as some new proposals. Department of the Treasury released its general explanations (the “Greenbook”) of the Biden Administration’s fiscal year 2022 revenue proposals. Transfer Tax Controversy and Litigation.State and Local Tax Controversy and Litigation.Financial Instruments and Credit Agreements.Customs, Anti-dumping and Countervailing Duty Services (U.S.).
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