The US Internal Revenue Service (IRS) has said it will consider certain circumstances in which it could provide relief from double taxation resulting from application of the repatriation tax, as amended by the Tax Cuts and Jobs Act (TCJA) 2018.
Following a review, the IRS has determined that in some instances, such as where a company has paid an unusual dividend for business reasons, it may be provide relief from double taxation.
The concession relates to article 965, and came to the IRS's attention through an inquiry via a taxpayer who explained in detail why its situation fell outside the purview of final regulations on Section 965, according to a report by Bloomberg.
Under the US tax law (1997), repatriation tax, or transition tax applies to earnings accumulated offshore since 1986, which are treated as repatriated. Repatriation tax is charged at 15.5% on cash and 8% on illiquid assets.