Author:
As an Associate in Dorsey’s Tax, Trusts and Estates group, Ian advises clients on a wide range of tax matters. His practice focuses on U.S. federal income tax issues related to inbound and outbound tax planning for multinational structures, tax treaties, controlled foreign corporations, passive foreign investment companies, entity formations, reorganizations and restructuring, debt and equity financing, and mergers and acquisitions.
View Full Bio on Dorsey
In September, a new bill was introduced in the U.S. Senate entitled the “Halting International Relocation of Employment Act” or “HIRE Act” (the “Bill”). Generally, the Bill proposes a 25% excise tax on certain outsourcing payments made by U.S. persons or entities to non-U.S. persons or entities. The Bill, if enacted, could have a significant impact on Canadian companies that are currently engaged in certain cross-border arrangements with U.S. companies, including subsidiaries or affiliates. In general, the Bill would impose a 25% excise tax on any premium, fee, royalty, service charge, or other payment made in the course of a trade or business by a U.S. person to any non-U.S. person if the...
As discussed in our prior blog posting, Canadian companies should be aware that, if they engage in certain “organizational actions” (as discussed below) that affect the tax basis of their securities held by one or more U.S. persons, they may be required to evaluate the effect of such action on the U.S. holder’s tax basis and promptly disclose this information on a properly completed IRS Form 8937, Report of Organizational Actions Affecting Basis of Securities. Generally, Internal Revenue Code Section 6045B (including the Treasury Regulations promulgated thereunder) requires an issuer classified as a corporation for U.S. federal income tax purposes of certain securities to report on an IRS Form 8937 any “organizational action”...
On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022, HR 5376 (the “Act”), into law. Among other significant changes, the Act includes a new 1% excise tax on stock repurchase transactions by certain publicly traded corporations (the “Excise Tax”). As described below, publicly traded Canadian companies that: are treated as U.S. corporations for U.S. federal income tax purposes under the anti-inversion rules in Code Section 7874(b); became treated as “surrogate foreign corporations” for U.S. federal income tax purposes on or after September 20, 2021 under the anti-inversion rules in Code Section 7874(a)(2)(B); or are not subject to the anti-inversion rules but that effect a stock repurchase through one or...
