US IRS rules CFC loans don’t qualify for Notice 88-108

 

The US IRS in Chief Counsel Advice 201516064 released April 17 ruled that none of a taxpayer’s controlled foreign corporation loans satisfy Notice 88-108 because one of its loans did not satisfy the requirements of the notice.

“Unless a controlled foreign corporation holds for fewer than 60 calendar days during a taxable year all obligations which, without regard to the 30-day rule described in Notice 88-108, would constitute United States property within the meaning of section 956, the exclusion from the definition of the term “obligation” in Notice 88-108 does not apply with respect to any obligation held by the controlled foreign corporation,” the IRS said.
See:

•  Chief Counsel Advice 201516064

For analysis, see:

• PWC