Background
The Internal Revenue Service’s recently issued general legal advice memorandum (GLAM) should provide beneficial results to certain taxpayers that use a check-the-box election to convert an insolvent foreign corporation into a partnership.
Overview
Since July 1, 2019, changes came into force that will affect customs regulation, licensing, public procurement, investor relations, corruption risk assessment and many different sectors.
Purchase from defaulter cannot be credited VAT
Buyers of goods (works, services) are not entitled to include VAT in offset if the supplier is not a payer of this tax. Information on taxpayer registration with tax authorities as VAT payers can be obtained on the STC website.
“One-stop-shop” is opened for investors
The Law on Enterprise and Law on Investment that took effect in 2015 introduced refreshing changes to Vietnam’s investment and business landscape. Designed to stimulate and better facilitate foreign investments in the country, the two new laws have since given rise to several implementing regulations that expound on important subjects such as foreign ownership up to 100% in listed companies, private public partnerships, trade, and representative offices.
Law360, New York (May 5, 2016, 12:02 PM ET) -- A core principle of bankruptcy tax litigation holds that “bankruptcy courts have universally recognized their jurisdiction to consider tax issues brought by the debtor, limited only by their discretion to abstain.” IRS v. Luongo, 259 F.3d 323, 329-330 (5th Cir. 2001) (citing In re Hunt, 95 B.R. 442, 445 (Bankr. N.D. Tex. 1989). The Second Circuit recently departed from that generally accepted principle in United States v. Bond, 762 F.3d 255 (2d Cir. 2014).
(6th Cir. B.A.P. Apr. 26, 2016)
On February 5, 2016 the IRS released Chief Counsel Advice Memorandum Number 201606027 (the IRS Memo) concluding that “bad boy guarantees” may cause nonrecourse financing to become, for tax purposes, the sole recourse debt of the guarantor. This can dramatically affect the tax basis and at-risk investment of the borrowing entity’s partners or members. Non-recourse liability generally increases the tax basis and at-risk investment of all parties but recourse liability increases only that of the guarantor.
The IRS issued a Memorandum on April 15, 2016 clarifying the treatment of nonrecourse debt subject to certain “bad boy” guarantees. The Memorandum takes a position contrary to the recent Chief Counsel Advice (CCA 201606027) and is more in keeping with the general view of the real estate industry.
IRS Clarifies That a Typical “Bad Boy Guarantee” Will Not Cause an Otherwise Nonrecourse Financing to Be Treated as Recourse
On April 15, 2016, the IRS released a generic legal advice memorandum (the “GLAM”)1 providing an important and helpful clarification of the treatment of a guarantee of a partnership nonrecourse liability when the guarantee is conditioned on certain typical “nonrecourse carve-out” events (commonly referred to as “bad boy guarantees”).