Tax Cuts and Jobs Act - Quick Review of Exempt Organizations and International Tax Provisions - For the 2019 Tax Year (Course Id 1540)

Taxes - Taxes for Course Id 1540

The Tax Cuts and Jobs Act of 2018 was a significant change to the US tax code. The Tax Cuts and Jobs Act is organized into four primary sections of: Individual Tax Reform, Business Tax Reform, Exempt Organizations and International provisions. This is an updated course for 2019 that will provide a quick review of the Exempt Organizations and International Tax Provisions portions of the Tax Cuts and Jobs Act Bill (H.R.1.) and it also includes the provisions that have changed for 2019. This course will provide a summary description of the Exempt Organizations and International Tax Provisions referenced in the Tax Cuts and Jobs Act. It will identify which sections changed for 2018 and which were updated for 2019.

NASBA QAS - Text - Technical - NASBA Registry - IRS Enrolled Agents - 1540

Course Learning Objectives

• Review the Exempt Organizations provisions and identify which sections changed for 2018 and which were updated for 2019;
• Review the International Tax provisions and identify which sections changed for 2018 and which were updated for 2019; and
• Identify the effective date for all provisions in the Tax Cuts and Jobs Act.

Chapter 1 - Overview of Exempt organizations and International Tax Provisions portions of the Tax Cuts and Jobs Act

Course Learning Objectives

Introduction

EXEMPT ORGANIZATIONS

Unrelated Business Income Tax

Clarification of unrelated business income tax treatment of entities exempt from tax under section 501(a)

Exclusion of research income from unrelated business taxable income limited to publicly available research

Unrelated business taxable income separately computed for each trade or business activity

Excise Taxes

Simplification of excise tax on private foundation investment income

Private operating foundation requirements relating to operation of an art museum

Excise tax based on investment income of private colleges and universities

Provide an exception to the private foundation excess business holdings rules for philanthropic business holdings

Requirements for Organizations Exempt From Tax

Section 501(c)(3) organizations permitted to make statements relating to political campaign in ordinary course of activities in carrying out exempt purpose

Additional reporting requirements for donor advised fund sponsoring organizations

INTERNATIONAL TAX PROVISIONS

Establishment of Participation Exemption System for Taxation of Foreign Income

Deduction for foreign-source portion of dividends received by domestic corporations from specified 10-percent owned foreign corporations

Modification of subpart F inclusion for increased investments in United States property

Special rules relating to sales or transfers involving specified 10-percent owned foreign corporations

Treatment of deferred foreign income upon transition to participation exemption system of taxation and deemed repatriation at two-tier rate

Election to increase percentage of domestic taxable income offset by overall domestic loss treated as foreign source

Rules Related to Passive and Mobile Income

Deduction for foreign-derived intangible income and global intangible low-taxed income

Special rules for transfers of intangible property from controlled foreign corporations to United States shareholders

Modifications Related to Foreign Tax Credit System

Repeal of section 902 indirect foreign tax credits; determination of section 960 credit on current year basis

Source of income from sales of inventory determined solely on basis of production activities

Separate foreign tax credit limitation basket for foreign branch income

Acceleration of election to allocate interest, etc., on a worldwide basis

Modification of Subpart F Provisions

Repeal of inclusion based on withdrawal of previously excluded subpart F income from qualified investment

Repeal of treatment of foreign base company oil related income as subpart F income

Inflation adjustment of de minimis exception for foreign base company income

Look-thru rule for related controlled foreign corporations made permanent

Modification of stock attribution rules for determining CFC status

Modification of definition of United States shareholder

Elimination of requirement that corporation must be controlled for 30 days before subpart F inclusions apply

Current year inclusion of foreign high return amounts or global intangible low-taxed income by United States shareholders

Prevention of Base Erosion

Base erosion using deductible cross-border payments between affiliated companies

Limitations on income shifting through intangible property transfers

Certain related party amounts paid or accrued in hybrid transactions or with hybrid entities

Shareholders of surrogate foreign corporations not eligible not eligible for reduced rate on dividends

Provisions Related to the Possessions of the United States

Extension of deduction allowable with respect to income attributable to domestic production activities in Puerto Rico

Extension of temporary increase in limit on cover over of rum excise taxes to Puerto Rico and the Virgin Islands

Extension of American Samoa economic development credit

Other International Reforms

Restriction on insurance business exception to the passive foreign investment company rules

Repeal of fair market value of interest expense apportionment

Modification to source rules involving possessions

Review Questions

Glossary