The recently enacted U.S. tax reform law [H.R. 1] made many far reaching changes that have a significant impact on businesses in terms of data gathering, reporting requirements and tax return filings. The tax law included several new compliance and reporting rules that particularly affect companies with cross border operations, or that engage in financial transactions with foreign entities.
A KPMG health check-up can help ensure that your organization is meeting post tax reform compliance requirements.
Deductions from FDII
Deductions against certain income derived from financial transactions with foreign individuals or entities may be available.
Certain U.S. shareholders of controlled foreign corporations (CFC) must include GILTI in taxable income. But this amount may be offset by certain interest expenses.
State and local taxes
The tax reform law has varying impact upon state and local tax calculations and return filings (e.g., whether states follow the federal 100 percent bonus depreciation rules).
KPMG works with our clients to find efficient approaches to address provisions of the tax reform law, including the new carried interest rules. We also help them perform transaction analysis and modeling that reflect the new limits on interest expense deductions, NOL, and executive compensation, as well as the new depreciation rules.
Then we conduct a gap analysis and due diligence planning so that our clients with foreign entities, who conduct business internationally, or receive income generated outside of the U.S. can comply with the new law’s international tax provisions.
We supplement our health check approach with industry-leading technology and innovation capabilities, which include intelligent automation and artificial intelligence software platforms that have been updated to account for tax reform’s additional reporting requirements. Our International Tax Reform Analyzer factors in the potential impact that key international tax reform provisions will have on a client, and allows us to model and prioritize various planning scenarios.