Outbound Liquidations to Foreign Corporations
 
November 26, 2002
 

The Internal Revenue Service (IRS) has issued a notice of proposed rulemaking and notice of public hearing with respect to regulations that provide guidance regarding the application of section 367(e)(2) to certain outbound liquidations. The regulations amend the anti-abuse rule of Sec. 1.367(e)-2(d) by narrowing the scope of the rule to apply only to outbound transfers to a foreign corporation in a complete liquidation of a domestic corporation in which a principal purpose of the liquidation is the avoidance of U.S. tax. Written or electronic comments must be received by February 18, 2003.  A public hearing on the proposed regulations is scheduled for March 3, 2003.  Requests to speak and outlines of topics to be discussed at the public hearing must be received by February 11, 2003.  Comments may be submitted electronically directly to the IRS Internet site at www.irs.gov/regs. The public hearing will be held in Room 4718, Internal Revenue Building, 1111 Constitution Avenue, NW., Washington, D.C.  A copy of the proposed regulations and additional information on submitting comments are available http://a257.g.akamaitech.net/7/257/2422/14mar20010800/edocket.access.gpo.gov/2002/02-29508.htm.